Uber, the app-based ride-sharing service, is popular in cities around the world. I use it myself, mostly in Toronto, but in other places as well. The service is innovative and impressive, although my general enthusiasm was lessened recently by a bad experience. I was in a small Nova Scotia fishing village, minding my own business, when I got a surprising text message: “Your driver Achmed will be there in two minutes.”
No, he wasn’t. Turns out my Uber account had been hacked, and someone was riding around the U.K. city of Birmingham, charging so-called “ghost rides” to my Visa card. It wasn’t easy to sort the mess out, and Uber was not helpful.
One of the most interesting things about Uber and its customers is that they couldn’t care less about obeying the law. At the moment, Uber operates in Toronto contrary to municipal bylaws. (The same is true in many other cities.) Almost no one gives a damn about this. Occasionally, a politician or civic activist will grumble. Those in the taxi industry kick up a fuss, but they’re mostly worried about their bread and butter, not the rule of law. Just about everyone else looks the other way. Recently, Toronto put forward a bylaw that proposes minimal regulation of Uber (and weakens the rules for taxis). The suggested bylaw has been criticized by just about everybody.
There are about 16,000 Uber drivers in Toronto. About 20,000 Uber rides are taken in the city every day. Let’s be plain about what’s going on under the current regime: the drivers are breaking the law, and their riders are encouraging them to do so. Why shouldn’t they? There don’t seem to be any consequences of illegal behaviour.
The truth is that there’s a quiet conspiracy among Uber, its drivers and passengers, and the municipal authorities. They all want the ride-sharing service, and they’re going to have it whatever the rules say. It’s a kind of covert civil disobedience – not exactly Mahatma Gandhi’s satyagraha, perhaps, but civil disobedience nonetheless. This behaviour suggests, surprisingly and contrary to stereotype, that if it suits us, we Canadians will regard laws as a sort of smorgasbord. We’ll pick and choose among the rules, and obey only the ones we like.
What happens to a law if there’s a consensus against it; if everyone decides to ignore it (including those who are supposed to ensure its enforcement)? There’s a fancy word for that phenomenon – desuetude. Desuetude is the legal doctrine that says laws lapse if there’s a history of non-enforcement. Will there be a tsunami of desuetude in the new app-driven gig economy? Will Uber, Airbnb, TaskRabbit, Etsy and crowdfunding escape traditional regulatory requirements with our widespread consent and connivance, first temporarily and then permanently?
What happens, for example, to more fundamental rules, such as securities laws and banking regulation, if we all decide we don’t care for them?
But enough of all that. I must go now. I’ve just got a text message. Achmed will be at my front door in two minutes.
© 2016 Investment Executive. All rights reserved.
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