From Uber to e-payments and drones, can Hong Kong laws keep up with changing technology?

Bernard Chan says Hong Kong’s legal framework is lagging behind its smart city aspirations. The challenge will be crafting laws that protect the public while encouraging innovation

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A photograph of Hong Kong taken by a drone that was entered for an international competition. Drone flying is just one of the new technologies Hong Kong law needs to accommodate. Photo: Songshen Jiang/ 2018 Sony World Photography Awards

Published: 1:38pm, 18 Jan 2018Updated: 7:27pm, 18 Jan 2018

Technology is now changing so rapidly that Hong Kong’s laws are unable to keep up. This threatens to hinder the development of new business models and services and the vision of a smart city. The best known example in Hong Kong is ride-hailing apps like Uber, which connect people who want a ride with car drivers willing to offer one.

Behind the technology, we are basically talking about car owners moonlighting as unlicensed taxi drivers. This has always been illegal, as some operators do not have hire-car permits and proper insurance. Needless to say, the licensed taxi industry opposes competition and wants the authorities to clamp down.

Yet the public wants more choice and better quality hire-car services. The technology makes such services easy to offer – and it is difficult to ban in practice. At some stage, the government needs to accommodate ride hailing within a legal framework.

Hong Kong taxis may be willing to team up with ride-hailing giant Uber for ‘win-win situation’

Hong Kong taxi drivers hold a protest outside the Uber headquarters in November 2017. Photo: Dickson Lee

Another example of disruptive use of technology is Airbnb, which enables people to rent out rooms to travellers. Like ride hailing, it is in theory about sharing but, in practice, it is mainly used by commercial landlords to compete with hotels and guest houses without complying with permits or paying taxes. While popular with tourists, it can harm residential neighbourhoods. In some cities, it is reducing the supply of long-term rental housing. And, in Hong Kong, more residents are complaining about strangers in their buildings and privacy concerns. The government is looking into this. How does it balance different interests while having laws that are enforceable?

Illegal, unlicensed and completely unregulated ... so why is Airbnb booming in Hong Kong?

Drones are perhaps a test case. With our unique urban environment, we could be at the cutting edge of some new technological applications

Many commentators claim Hong Kong is lagging behind in e-payment systems, especially compared with the mainland where cash transactions are becoming old-fashioned. People are also complaining that Hong Kong officials appear to be uncertain about policy on electric vehicles and have been unprepared for bicycle-sharing services. The government is also being very cautious about self-driving vehicles, which are already being tested on the streets in some cities.