The Hong Kong Special Administrative Region government proposed on Friday a regulatory framework for a smooth and efficient ride-hailing service in the city.

Vehicles in service should be less than 12 years old and drivers should be the owners of the registered vehicles; other proposals include licences for platforms, vehicles and drivers.

The proposal is the latest effort by the city, long troubled by its sometimes unreliable taxi services, to reform the sector to better serve disgruntled passengers.

In July, the government also introduced its official franchise taxi fleet, which now has five premier taxi fleets that come with online hailing services and offer Wi-Fi and phone charging on board.

The draft regulation was gazetted on Friday. The government will strive to pass the bill in this Legislative term, aiming to see the first batch of such vehicles take to the road in the fourth quarter of next year.

According to the Road Traffic (Amendment) (Ride-hailing Service) Bill 2025, running a platform without a licence is subject to a maximum fine of HK$1 million ($128,186) and imprisonment of 12 months. The platform and vehicle owner are subject to a fine of HK$10,000 each if the vehicle is let to an unlicensed person.

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A spokesman for Transport and Logistics Bureau in a Thursday statement said the amendment aims to introduce a regulatory regime for ride-hailing services to safeguard the traveling public, and address long-standing controversies.

According to the proposed regulatory regime, platforms, vehicles and drivers providing ride-hailing services must obtain appropriate licences and permits, and meet the licence and permit conditions imposed by the Transport Department. Appropriate third-party risk insurance and identification markings are required.

The government proposed that applicants must meet a series of conditions, including being at least 21 years old, holding a Hong Kong permanent identity card, and having no serious traffic conviction records within the five years before applying. They must also complete a specified test.

Tests for drivers will be merged into the existing quiz for taxi drivers. Those holding taxi driving licences will be exempted from the test and pre-service courses and may directly apply for the ride-hailing licence to the Transport Department. The licence, valid for five years, is may be renewed unlimitedly.

The proposed regulation, however, didn’t specify a cap on the number of vehicles for ride-hailing services. This will be dealt with in a subsidiary legislation by mid-2026, which will give the Commissioner for Transport the power to decide how licenses are allocated.

Once approved, the government plans to phase in applications for platforms, vehicles, and drivers starting in the third quarter of 2026.

The bill will be tabled at the LegCo on Sept 10 for first and second readings.

According to a survey conducted last year, Hong Kong handles approximately 880,000 point-to-point passenger trips daily, of which ride-hailing services account for about 190,000 trips, constituting roughly 22 percent of the total volume. Over 70 percent of surveyed taxi drivers indicated that they receive orders through ride-hailing platforms, with about one-third of their orders coming from online channels.

The ride-hailing service platform Uber said that it is a milestone for the HKSAR’s ride-hailing services, and hoped to keep negotiating available solutions with the government and stakeholders under this framework.

Contact the writer at atlasshao@chinadailyhk.com