Airlines & Airports
FTC Chair Proposes 'Targeted' Regulations for Uber/Airbnb-Style Services
PHOTO: Uber protest in Mexico. (photo via Twitter/CirculoRojo_mx)
In the brave new world of “sharing economy” (aka, “peer-to-peer” or “on-demand”) services like Uber and Airbnb, Federal Trade Commission (FTC) chair Edith Ramirez asserted that regulations are necessary, but must be carefully applied, as to not stifle companies using similar business models, Brendan Sasso of the National Journal reported.
Speaking at Fordham University Law School in Manhattan Friday, Ramirez warned against levying “legacy regulations on new business models,” Sasso said, drawing from a copy of her remarks.
According to Sasso, the FTC chief believes a regulatory balance must be found between freedom to forge new ground as a business and protecting the consumer.
Ramirez stated, “We must allow competition and innovation in the form of these new peer-to-peer business models to flourish … at the same time, where necessary, targeted regulatory measures may be needed to ensure that these new business models have appropriate consumer protections; but they should be no greater than necessary to address those concerns.”
Ramirez said that these consumer protections included aspects of health, safety and privacy.
Sasso noted that new regulations might come from agencies other than the FTC. He stated that while it “does have authority over issues like privacy and data security,” the FTC also advises state and local agencies on how to enforce regulations without affecting competition.
The National Journal writer called Ramirez’s remarks “the latest tentative attempt by policymakers to try to grapple with the explosion of ‘sharing economy’ apps.”
That is, apps that connect buyer and seller directly, with no intermediary.
In the travel industry, well known ‘sharing economy’ services include Uber, Lyft, and Sidecar, which are car-hailing companies and Airbnb, a room booking service.
But local regulators around the world have balked at the way they do business, Sasso said. Taxi drivers and hotels say they have an unfair advantage by avoiding costly regulations. Sasso cited Uber as an example, and pointed out that the service has been banned in several cities and executives are facing criminal prosecution in France.
Sasso said Ramirez put forth the argument that existing regulations can reinforce old business models and keep consumers away from new services.
The National Journal writer said she also warned that agencies could be greatly influenced or even controlled by industries already in place that are being regulated.
But she also argued, according to Sasso, that the government “picking winners” by regulating only older companies “should be just as undesirable.”
In the end, Sasso said Ramirez acknowledged that finding a proper middle ground is “complex and challenging” and has “no simple answers.”
Friday’s speech by the FTC head comes less than a week after the House Energy and Commerce Committee’s trade subcommittee “struggled to find the right approach to regulating these new services,” as Sasso put it.
Michael Burgess (R-Tx.), chair of the subcommittee, “acknowledged” the need for “limited government oversight” of sharing economy services, Sasso said. But Burgess added, “I for one am more concerned about existing regulations hurting new jobs than I am about the need for new regulations.”
Sen. Mark Warner (D-Va.), has pushed for disability insurance and other benefits for on-demand employees, according to Sasso, but has also requested a “regulatory time-out” to give the legislative body time to come up with the proper rules.
For more Impacting Travel News
More by Michael Isenbek
Get Travel Deals and Travel News
Recent Travel Opinions
Cruise Line & Cruise Ship
Cruise Line & Cruise Ship