TOKYO -- The Japanese government's vision for a sharing economy apparently has little room for one important trend -- the growing global popularity of ride-hailing services. The government is set to publish a report detailing cross-industry rules designed to protect consumers in the peer-to-peer economy, which could be released as early as November. The Cabinet Secretariat's council on the sharing economy, which includes experts in a number of fields, has been discussing necessary rules for peer-to-peer services, such as online marketplaces for private accommodation, housekeeping and parking space sharing. But the panel has so far paid little attention to ride-hailing. "There's a lot of suspicion that we are plotting to create loopholes for ride-sharing services," said a bureaucrat at the Cabinet Secretariat. The discussion sessions, which started in July, are open to the public. Anyone can attend simply by applying for a seat. So far sessions have attracted dozens of observers, but few are ordinary members of the public. The audience is mostly composed of executives in the taxi industry and officials from the transport ministry. Originally, the sharing-economy council started as a vehicle for discussing measures to promote and regulate information technology-driven services. The panel, which began working in October 2015, focused mainly on basic principles for the rules for home-sharing services. In November, an Airbnb official in charge of Asia presented evidence to the panel. During the session, it became clear that ensuring all owners let rooms in accordance with the law would be all but impossible. Many providers in Japan are believed to operate outside the law. At meetings of the sharing-economy council, the successor to the panel, the operators of sharing services for child care and conference rooms have also had their say. The world's largest ride-hailing service Uber Technologies, however, has never been given an opportunity to express its views. Virtually the only person championing ride-hailing services among council members is Satoshi Seki, a senior executive at the Japan Association of New Economy, an organization of IT companies and digital economy players headed by Rakuten CEO Hiroshi Mikitani. Seki argues that the government should set up a task force to legalize ride-hailing services. Since the council focuses on promoting voluntary rules of peer-to-peer economy industries, it spends little time on legal issues concerning private car- or room-sharing. "If we summon Uber to testify, the council's discussions will get nowhere fast," warned one council member. "The political risk is too large." Another said there is a tacit rule against touching on issues related to ride-sharing. The council appears reluctant to even discuss the issue out of fear of a backlash from the taxi industry. The council did summon Japanese car-sharing company notteco to put forward its case, however, this is a service aimed at sharing the costs of long-distance road travel that does not work in direct competition with the taxi industry. The transport ministry is also skeptical about Uber-style ride-hailing services, which put the responsibility for passenger transportation entirely on the driver, with nobody overseeing issues such as service operations or vehicle maintenance. The driver evaluation features of the apps do not help prevent accidents which could result in huge losses, said a ministry official. At an early October press conference, Transport Minister Keiichi Ishii said an "extremely cautious" policy approach is needed, stressing that the priority should be placed on passenger safety. A revision to the law governing special zones for the national economic strategy came into force in September, allowing ride-hailing services for tourists in these special zones. But nobody has taken advantage of the revision. Despite concerns among Tokyo bureaucrats, however, demand is growing steadily. Uber Japan has launched in some limited areas including Kyotango in Kyoto Prefecture and Nakatonbetsu in Hokkaido. But the company is required to meet strict conditions. It must declare who is responsible for its services and operations are limited to depopulated areas with little taxi provision. It also has to gain local government consent. Uber is also partnering with a growing number of small taxi service operators wishing to use the company's system. Some of the lawmakers who have been weary of ride-hailing are now beginning to seek government advice on how it could be used to revitalize local economies in their electoral districts. Uber now operates in over 400 cities in 70 countries. Some 50 million people use its service every month. "If the current situation remains unchanged, Japan will become famous as one of the few countries where Uber's service is not available, even during the 2020 Tokyo Olympics," one private-sector member of the council mocked after a recent session. "There are assumptions for rules," said Masami Takahashi, president of Uber Japan. "It is important to develop new rules in response to changes in the assumptions due to technological progress." But Takahashi's argument seems to cut little ice with most lawmakers. "If a serious accident occurs, the government will be criticized for promoting deregulation," said a Diet member of the ruling Liberal Democratic Party. Policymakers are showing little enthusiasm for promoting candid and broad-based discussion. If the government is serious about using the Tokyo Olympics as a springboard for the growth of the sharing economy in Japan, it really needs to get a move on.
Japan’s government is due to publish a report on cross-industry rules to protect consumer rights in the sharing economy but appears to have omitted ride-hailing services such as Uber Japan. The sharing-economy council from the Cabinet Secretariat discusses measures to promote and regulate IT-driven sharing-economy services such as home-sharing through Airbnb. Uber Japan has drawn criticism from Japan for its perceived lack of oversight to ensure customer safety and its direct competition with the native taxi industry. Aside from partnering small taxi operators looking to use its system, Uber is currently restricted to serving depopulated areas, subject to strict guidelines and local government consent.