The Catalan Competition Authority publishes Recommendations for the regulation of shared transport from a competition perspective.

Shared mobility (mope sharing, bike sharing, scooter sharing, etc.) is leading many city councils to regulate their use. The Catalan Competition Authority (ACCO) has published a working document describing the main challenges resulting from public intervention in this sector, where it formulates proposals for an efficient and pro-competitive regulation.

The promotion of shared mobility is an obligation for local administrations, especially since the approval of Law 7/2021, of 20 May, on climate change and energy transition, according to which the largest municipalities[1] must adopt, before 2023, sustainable urban mobility plans, including measures to promote shared electric mobility. It is expected that the future Spanish law on sustainable mobility and transport financing will contain some new regulatory measures applicable to shared mobility.

The ACCO document stresses that most local administrations that have regulated this activity have done so by means of licenses for the use and occupation of public space, either by means of a competitive process or a lottery (in cases where the number of licenses and/or operators is limited), or by awarding them to all operators, leading to very different solutions. The document stresses the need for this regulation to be pro-competitive and makes the following recommendations:

1. Promote public-private collaboration in the use of technology and data for better management of public space.

Technology and the use of data make it possible to design smart regulations that are more efficient in collaboration with platforms, through the creation of a data space where the administration and operators can share data in a standardized way. Data sharing enables better regulation of, for example, user suitability, the application of penalties or the establishment of virtual parking zones, as well as dynamic parking zones that adapt to the needs of public space at any given time and to occupancy data.

Data should also be used to decide on operators’ market entry and exit according to efficiency criteria, allowing municipalities to rule out an approach based on a numerus clausus of licenses and/or operators.

Regulation must consider the network effects on which the platforms’ business model is based and should avoid models with many operators but with significant growth limitations due to the limited public space that is made available to offer their services. In addition to promoting public space for shared mobility services, municipalities can also promote aggregation platforms that allow users to compare options, although they must ensure that competition rules are respected (Law 15/2007, of July 3, 2007, on the defense of competition)[2].

2. Assess alternatives to limiting operators and/or licenses based on a good analysis of necessity and proportionality. Possibility to set up regulatory sandboxes.

The limited public space available and its intensive use is one of the legal grounds most commonly used by municipalities to limit the activity, either by capping the number of licenses and/or the number of operators. ACCO invites to consider the existence of other legal titles on which to base regulatory intervention.

ACCO compares the regulations of several European and Spanish cities that have adopted different approaches regarding the limitation of mope sharing, bikesharing and shared scooter licenses. It highlights that, from a competition perspective, limiting the exercise of an economic activity through a limited number of operators and/or licenses is not always fully justified by criteria of necessity and proportionality and should therefore be the last resort, since it is more restrictive and detrimental to the consumer as it leads to higher prices and lower quality and innovation. The document recommends less restrictive alternatives aimed at correcting the negative externalities derived from the activity, while guaranteeing economic activity and competition as much as possible:

• Increase parking areas for shared vehicles
• Sanctioning users
• Design a fee to provide the service or to use the public space
• Prioritize the efficiency of operators

ACCO recommends that municipalities consider the impact that shared mobility may have on the use of private vehicles, in particular whether there is transfer from one user group to another and whether this results in more public space available.

Regulatory sandboxes are considered as a good tool for municipalities to test shared mobility before adopting final regulations, in order to gain in efficiency and effectiveness. However, ACCO warns of the risks on competition that sandboxes may raise as operators involved have a competitive advantage and provides elements to minimize these risks.

3. Maximize competition in situations where the number of operators or licences are capped by regulation

Where a regulation limiting the number of operators and/or licences is adopted, regulators must ensure that both the selection procedure and the specific conditions established in the licence have the least possible impact on competition.

With regard to the selection procedure, a competitive bidding process is preferable to a lottery, since it allows the benefits of competition for the market to be captured (operators compete with each other to obtain licenses).

In relation to the licence conditions, it is essential from a competition perspective:

• To limit the period of validity of licenses as much as possible
• To prohibit the transfer of licenses to avoid monopoly or regulatory rents
• To establish obligations for exiting operators to facilitate the transition of users to new operators (data portability obligations, etc.)

4. Respect the principle of competitive neutrality when the administration decides to participate in the market through an economic initiative

Some administrations choose to act as public operators in the shared mobility market. In this case, the administration must maintain competitive neutrality and operate with the same investment and profitability criteria as private operators, since it is a service provided in free competition with the private sector (in fact, it is not an essential public service).

Therefore, regulation must ensure a level playing field and fair competition in the market in which the public operator carries out its activity in such a way that it does not obtain competitive advantages that are not available to other operators. The ACCO refers to its previous report on the Barcelona Bicing service (No. 37/2018).

5. Limit the requirements for the exercise of the activity to those related to safety and the use of public space

In relation to safety issues, the document stresses that from a competitive point of view, it is not justified to create additional requirements or conditions to those already established, in general terms, in traffic regulations applicable to the same type of private vehicles.

6. Regulate from an intermodal transport perspective that takes into account all modes of shared transport, integration with public transport and cooperation between administrations

ACCO points out that the different modalities of shared mobility vehicles should be seen as complementary and, therefore, there is no reasonable justification for allowing only the development of some of them. In this sense, it is advisable to regulate from an intermodal transport perspective that contemplates shared vehicles in their entirety and, ideally, their integration with public transport. There are examples of collaborations with public transport (e.g. FGC and eCooltra). Such collaborations should not discriminate between operators.

The integration of these services in large urban areas must also be considered, requiring the collaboration between different local administrations.

Júlia Samsó Lucas

[1] According to Article 14, towns with more than 50 000 inhabitants, islands and towns with more than 20 000 inhabitants that exceed the maximum pollution thresholds.

[2] The document refers to existing aggregation platforms, such as Smou in Barcelona, Madrid Mobility 360 in Madrid, or Freenow, Wanda, RACC Trips, Urbi, etc.

Recomanacions ACCO regulacio_vehicle_compartit_cat