The Riigikogu passed the so-called rideshare bill into law last week, regulating the business of platforms like Uber and Taxify. According to Kalle Palling (Reform), instrumental in the bill’s introduction, this kind of legislation is the litmus test of any tech-savvy state.
ERR News: You were one of the law's first proponents. Are you happy with the outcome? Is there anything that it doesn't cover, but should have?
Kalle Palling: I'm okay with the outcome. Almost all the overregulation, both for taxis and ride-sharing, is out. In between the first and second readings there were a lot of proposals that would have killed the idea of a hassle-free service and ease of earning extra income.
If you’re asking what it doesn’t cover, I think there’s nothing. The only issue is the days needed to get the application. I would have expected that we could build up a 100-percent electronic and automatic system, so that if there are no negative answers from state agencies, the license will be issued. But I’m happy with the seven days and manual electronic signing by the municipality official as well.
In how far is the new law a pioneering piece of legislation?
I wouldn’t call it a pioneering piece of legislation, at least not in Estonia. We modernized the public transportation act, which was a must, because the development of technology has brought so many positive changes. The business model of the taxi sector was similar to the platforms’ business model already before. Also, we didn’t have a gap with the number of taxi licenses and their high price, as was the case in many EU countries. In Brussels, a license costs some €50,000. In New York, the medallion’s price is one million dollars. In Helsinki, there are only 1,200 taxi licenses compared to Tallinn’s more than 3,000.
So I hope that the Estonian model, both for taxis and ride-sharing side by side, will be copied in many countries. It will have huge economic and environmental benefits.
What do you expect its effect to be on other areas of the sharing economy?
Not only the sharing economy, but all the sectors where technology has helped change the way people act and consume services. The fintech and insuretech sectors are probably the most influential ones. Indrek Neivelt has said that there is the potential to save 2 percent GDP or more each year if we pay more attention and enable the fintech sector to grow. I believe that if we can save people’s time and money by enabling more efficient services, we have to enable them. If there's regulation needed, we have to regulate.
One thing I learned from the process is that a tech-savvy state has to be flexible to change laws and regulations as many times as needed. "We just changed the law two years ago..." can't be the argument any more. Unless we want to deny the digital revolution, which I guess we don't.
Kalle Palling (*1985) is a member of the Riigikogu for the Reform Party.
Editor: Dario Cavegn