ADVICE TO MINISTER CONFIDENTIAL ISSUES NOTE Ministry: Transportation Ride-hailing - Kater Date: December 18, 2018 Minister Responsible: Claire Trevena ADVICE AND RECOMMENDED RESPONSE: I'm pleased to hear the existing taxi industry is taking advantage of the opportunity to modernize their services by using an app as well as increasing their fleet size to better the needs of the consumer. It is well known that the current taxi model is outdated and failing the public -with a shortage of taxis on the street at peak times and numerous complaints from customers not being able to travel from one municipality to another. That’s why, as part of the first phase in the taxi modernization action plan on ride-hailing, the PT Board, an independent tribunal, gave existing taxi companies a one-time opportunity to increase their fleets by 15% - one of Dr. Hara’s key recommendations announced in July. We have always said that our approach to ride-hailing should allow the taxi industry to modernize its services to compete on a level playing field when new services enter the market. jislation now passed, consumers can expect ride-hailing companies to be able to enter the market and provide services in fall 2019. BACKGROUND REGARDING THE ISSUE: ‘The ministry is aware that the Vancouver Taxi Association (VTA) has recently entered an agreement with Kater (a new app-based ride hailing technology service, similar to Uber) to ‘work together to add 200 additional taxis in the Lower Mainland that will be app-based only, called Kater Cabs. ‘The Passenger Transportation Board approved additional licences to operate in Metro Vancouver, as part of the Passenger Transportation Board's taxi modernization process to. allow taxi companies to increase their taxi fleets by 15%, one of three short-term action items recommended by Dr. Dan Hara to modernize the taxi industry. Page 4 of 33 TRA-2019-90231‘The VTA and Kater have said that expect to have 50 of the new app-based taxis on the road by the beginning of January 2019. According to the company, Kater will provide driver training, ensuring the proper permits are in place, as well as paying the drivers. The taxis will be insured under the VTA taxi licence insurance, with the costs of the insurance paid for by Kater and the vehicles, operated by Kater. The Kater Cabs will not have traditional meters and the drivers will not accept cash from their customers. The Kater Cabs will hail customers exclusively using the Kater smart phone app (the Kater App). Kater's drivers will not solicit customers at hotels or taxi stands and the rates charged by Kater Cabs will be the same as the rates charged by VTA non- app based taxis. Under Passenger Transportation Branch regulations, licensees must maintain care and control of every passenger vehicle under the Act. The Passenger Transportation Branch is taking steps to ensure that all current provincial and licensing requirements are met including a regular, government approved safety inspection of the vehicles, insurance that will cover the carrying of paying passengers and compliance with licence boundaries and other requirements. All regulations will remain in place unti fall of 2019 when the ministry ‘expects ride-hailing companies like Uber and Lyft to apply to enter the market. {tis expected that Kater will expand their business model and apply to the Board to operate ride-hailing services when it is legal to do so in the fall of 2019. ‘Communications Contact: Sonia Reviewer: Lowe 250-882-6696 Program Area Contact Chantelle Gergley 604-604 862- 5550 Minister's Office Program Area Deputy Communications: st. Page 5 of 33 TRA-2019-90231