Experts on Tuesday urged stronger regulation of ride-hailing services after HKTaxi announced that it would cease operations on April 1 and encouraged users to transition to Uber, its parent platform.

The move underlined the growing dominance of Uber in Hong Kong, experts said, adding that it raises concerns over industry monopolization and fairness for licensed taxi drivers.

According to HKTaxi’s statement, user accounts on the platform are being gradually suspended, with full deactivation targeted for March 31. Some taxi drivers have been informed that their accounts will be deactivated as early as Feb 10.

In addition to continuing to receive a discount of up to 15 percent on fares, new users who successfully transition will get a HK$100 ($12.8) fare reduction for each of their first five rides.

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Lawmaker Gary Zhang Xinyu has expressed concerns that Uber, which has various vehicle options, could potentially monopolize the market in the long run, giving it greater pricing power.

Founded in 2013, HKTaxi was one of the pioneers of Hong Kong’s taxi-hailing market. It offered passengers taxi-booking services at metered fares, with the option to pay in cash upon arrival or to make electronic payments via credit card or Octopus.

Uber, which acquired HKTaxi in 2021, announced a collaboration with HKTaxi in 2023 to add the “metered fare” option to its app, alongside the existing flat fare option.

HKTaxi said the metered fare option would remain available on Uber after the shutdown. HKTaxi’s website says that the platform currently has over 70,000 registered drivers.

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Uber said that the integration of users will give taxi drivers greater access to customers through its platform.

Echoing Zhang’s remarks, Hong Kong Taxi Owners’ Association Chairman Wong Po-keung said issues such as unlicensed private cars operating under ride-hailing platforms have created an uneven playing field for licensed taxi drivers.

Currently, private cars need to secure a hire car permit to legally provide ride-hailing services, but some platforms blur the lines by misrepresenting private vehicles as legitimate taxi services, further complicating the regulatory landscape, Wong said.

Additionally, there are significant concerns about data privacy and security in light of the US ride-hailing giant’s global operations. Last year, Uber was fined 290 million euros ($299.7 million) in the Netherlands for transferring the personal data of European taxi drivers to the US.

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“Such information, if shared with foreign entities, could raise national security issues,” Wong said.

To ensure the healthy development of the ride-hailing industry and improve transportation convenience for residents, the government must take “a more proactive approach” to regulating ride-hailing services, Zhang Xinyu said.

“Regulation should not only focus on platform oversight but also address the core issue of demand and supply concerning ride-hailing licenses,” he added.

Last year, the Hong Kong Special Administrative Region government announced plans to study the regulation of ride-hailing platforms. Secretary for Transport and Logistics Mable Chan Mei-bo said in January that the bureau aims to introduce legislative proposals for online ride-hailing platforms and conduct consultations within this year.