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Oral Reply by Senior Minister of State for Transport Dr Janil Puthucheary to Parliamentary Questions on Steps Taken on oBike's exit from Singapore's market

09 Jul 2018 In Parliament

Mr Seah Kian Peng asked the Minister for Transport in respect of OBike's exit from the Singapore market, whether the Ministry will ensure that OBike will refund all unconsumed subscription fees to its subscribers.

Er Dr Lee Bee Wah asked the Minister for Transport

a.     what is the notice period required by any shared bicycle operator to give to the LTA when it wants to cease operations;

b.     what is the redress for users who have paid deposits for their services; and

c.     what assistance can LTA give to these depositors.

Miss Cheryl Chan Wei Ling asked the Minister for Transport what statutory measures are in place to prevent private companies offering shared bikes or PMDs from defaulting on their public and customer commitments such as service provision and deposits before the company goes into liquidation.

Miss Cheng Li Hui asked the Minister for Transport

a.     whether there are safeguards in place for consumers to obtain refunds on their OBike deposits;

b.     what recourse do consumers have should there be no refunds; and

c.     how can the interests of consumers be protected when bike-sharing firms exit the market.

Reply by Senior Minister of State for Transport Dr Janil Puthucheary:

1.     oBike’s sudden exit from Singapore has inconvenienced many Singaporeans. It has raised some concerns and questions. Let me address them comprehensively.

2.     First, oBike has attributed its decision to Government over-regulation. I suppose that is a convenient excuse.

3.     Dockless bicycle-sharing services offers Singaporeans a convenient travel option. We had deliberately adopted a light touch regulatory approach at the start, so as not to kill off this new innovative business model prematurely. Now that we have actual experience of both the benefits, and the significant social disamenities caused by indiscriminate bicycle parking, we have decided to tighten regulations. LTA will license bicycle-sharing operators under the Parking Places Act, so that only operators with responsible and sustainable bicycle management plans can operate in Singapore. The licensing regime will reduce indiscriminate parking by requiring operators to internalise the costs of the social disamenities caused by their businesses, failing which they should not be operating at all.

4.     We are mindful to minimise compliance costs for operators, as they could in turn be passed on to users. LTA finalised its regulations only after extensive consultation with the bicycle-sharing operators, including oBike. We note that several operators have expressed their support for the new regulations.

5.     Our licensing regime will kick in by October 2018. Licence applications closed on 7 July 2018 and LTA has received seven applications. LTA will evaluate each application based on the strength of the proposal, especially the plans to minimise indiscriminate parking.

6.     Second, allow me to speak about the consequences of oBike’s sudden exit from Singapore. LTA and the Consumers Association of Singapore (CASE) have met oBike to emphasise the importance of refunding user deposits and removing their bicycles from public spaces. On 1 July 2018, about one week after oBike announced its exit, oBike’s Chairman Shi Yi had publicly and personally committed to a full refund of user deposits. oBike is now working out a process with CASE to refund user deposits. I would like to emphasise again that it is oBike’s responsibility to have a concrete plan to refund user deposits and remove its bicycles from public spaces. If LTA has to step in to remove its bicycles, we will impose fees on oBike for doing so. LTA and CASE will continue to engage oBike on its responsibilities.

7.     Concurrently, as the company is in liquidation, CASE has advised that affected consumers should file their Proofs of Debt against oBike with the appointed liquidator, FTI Consulting. Those who are unsure about how to file Proof of Debt may contact CASE or the appointed liquidator for assistance.

8.     Following oBike’s exit, MoBike announced on 29 Jun 2018 that it would be waiving deposits for its Singapore users. With this, none of the current bicycle sharing operators require user deposits. With market pressures, new operators are likely to offer their services without deposits, so as to better compete with existing operators. If there are operators which require user deposits when the licensing regime is implemented from October this year, LTA will study the need for bicycle-sharing operators to place a security deposit or performance bond.

9.     Going forward, LTA will monitor and strengthen the licensing regime as necessary, as well as work with relevant organisations such as the Personal Data Protection Commission, CASE, National Parks and the Town Councils on public education and outreach, so as to strike the right balance between the viability of the industry and the interests of users and the general public.