In the last PHTM issue (March 2017) I wrote about a recent case involving Delta Taxis and Uber challenging an intended use policy adopted by Knowsley Metropolitan Borough Council which was the council’s attempt to address cross-border hiring in its locality.
The issue of cross-border hiring continues to be a high profile and important issue nationally for both the trade and regulators. It has divided opinion like very few taxi and private hire issues have in the past even amongst the trade itself.
In this article I would like to consider the wider issue of cross-border hiring, look at what is happening on the national level and finally what the Government’s likely response will be.
Cross-border hiring
“Cross-border hiring” as a term and a concept is not one found in law.  The term is generally used in the trade to describe a practice where taxis or private hire vehicles that are licensed by one licensing authority work wholly or predominantly in another licensing authority area.
The issue of cross-border hiring first arose most prominently in the case of Newcastle City Council, Regina (on the Application of) v Berwick-Upon-Tweed Borough Council and others.  This was the first case of its kind where the lawfulness of cross-border hiring was tested in a court of law.
In the Newcastle case the High Court found that the purpose of the licensing system was to ensure safety but where taxi drivers predominantly operated outside their licensing authority’s area, the supervision necessary to ensure safety was weakened.
Berwick-Upon-Tweed Borough Council had argued that the legislation did not give them the discretion to refuse licences in the way Newcastle wanted it to do (i.e. based on where drivers predominantly operate).
Whilst the High Court held Berwick-Upon-Tweed were not acting unlawfully, it did labour the point that the nature of the licensing system was local in character, with public safety in mind, and it could be open to a local authority, in determining whether to grant a licence under the said section 37, to require an applicant to submit information pursuant to section 57 Local Government (Miscellaneous Provisions) Act 1976 in order to ascertain the intended usage of the vehicle.
Legal arguments both in support and against cross-border hiring have continued consistently since the Newcastle case in 2008 culminating in the most recent case which found, on merit, an intended use policy to be unlawful (see “Where do you draw the line” PHTM March 2018).
The National Picture
As I mentioned, the debate about cross-border hiring has been raging on since it came to ahead in 2008 and the profile of the issue has reached national proportions.  Consequently there has recently been a great amount of activity and developments in relation to cross-border hiring which is certainly worth the trade taking note of.
Licensing of Taxis and Private Hire Vehicles (Safeguarding and Road Safety) Bill
One of the main arguments against cross-border hiring advanced, particularly by licensing authorities, is that of the safeguarding implications of the practice. In response to this, a Private Members Bill, the Licensing of Taxis and Private Hire Vehicles (Safeguarding and Road Safety) Bill, has been laid before Parliament by Daniel Zeichner MP.
Section 5 of the Bill (“Duty to report concerns about out-of-area drivers”) will place a statutory duty on licensing authorities to report conduct and safety issues, relating to out of town drivers working in their area, to the licensing authority where they are licenced.  In turn the receiving licensing authority will be under the same statutory duty to act upon receipt of relevant information.  The test will be whether “the first authority is satisfied that, had it granted the licence, it would have considered suspending or revoking it in reliance on the information.”
The Bill is due to have its second reading in the House of Commons early Autumn this year.
Cross Border Hiring – Proposals for Legislative Change (TfL)
In response to Parliamentary debates in July last year, the Department for Transport setup a Taxi and Private Hire Task and Finish Working Group (more on this later).  In giving evidence, Transport for London recently (March 2018) submitted a comprehensive report the task and finish group setting out its proposals for legislative change to address particularly issues around cross-border hiring.  Whilst the report was published by TfL, it included engagement and input from other licensing authorities around the country.
In the report, TfL made a number of legislative change recommendations to the Government including:

  1. Introduction of a start or finish requirement, meaning that all taxi and private hire journeys either start or end in the area in which the driver and vehicle (and operator in respect of private hire) are licensed.
  2. National minimum standards set at a high level, to provide a consistent approach to customer safety and accessibility.
  3. National enforcement powers, to allow enforcement officers to enforce the national minimum standards in their areas regardless of where the operator, driver and vehicle are licensed, supported by a provision for data sharing.
  4. We would also recommend that the impact of these issues in Scotland and Wales are considered by the respective Governments, as not to undermine any future requirements to address cross border hiring in England.

There has recently been a number of high profile safeguarding scandals around the country.  A number of subsequent enquiries and investigations have pointed a finger at cross-border hiring practices as having played a contributory factor.
In February this year a report investigating the sexual exploitation of vulnerable people in the North called on the Government to act on weak licensing rules that has led to cross-border hiring.  The report stated that: “Experience identified a weakness in licensing arrangements for individuals who have a licence to operate a taxi removed but may continue as a private operator of larger vehicles. It was also suggested that because of the large number of licensing authorities for different areas a national data base of individuals who have been refused a licence or had one removed should be kept.”
In March Val Shawcross, London’s Deputy Mayor for Transport, called on the Government to “ensure the safety of taxi and private hire passengers nationwide by ending the potentially dangerous practice of cross-border hiring.”
She said technological advances that has increased that scale of cross-border hiring is causing serious public safety concerns.  She cited a case where a driver with convictions for violence and sexual offences was granted a licence and working elsewhere despite being refused in Doncaster.
The growth of ride hailing technology has played a substantial role in the increased prevalence of cross-border hiring.  Whilst other ride hailing services exist, Uber is by far the biggest operator in the country.  In March, in response to concerns raised by regulators relating to cross-border hiring, Uber announced a change to how it will allocate work to its drivers.
In a change to its policy on allocating work, Uber introduced geofencing that created virtual geographic operating boundaries for its drivers.  The change meant that Uber drivers will still be free to choose where they want to drive, however, drivers will only be able to receive requests from the Uber app in the region in which their licensing authority is. The location of your driver’s licence will allow you to drive in one of 9 regions in England and Wales.
So for example, if a driver has a TfL private hire licence, but does the majority of their driving with Uber in Birmingham, they will have to get a private hire licence from a council in the Midlands to continue driving with Uber in and around this area.
The Government
Cross-border hiring has firmly been on the Government’s agenda of late.  In July last year Frank Field MP opened a debate in Parliament on the “working conditions in the private hire industry” saying “Uber and similar companies are registering in London, Leeds, Liverpool and Glasgow, getting the necessary licences from those areas’ transport executives. Is it because the legislation is uncertain or difficult to interpret that these transport executives are not saying, “These are the minimum conditions that you, the company, must meet if you wish us to grant you a licence to operate in our area”? I would like to hear the Minister’s view, but I think the position is quite clear.​”
A second debate was by Wes Streeting MP also in July.  In that Parliamentary debate Mr Streeting said “The taxi and private hire industry is, in many respects, at the cutting edge of an industrial revolution that is sweeping the world at unprecedented scale and pace. Breakthroughs in technology offer unlimited potential to improve our quality of life and revolutionise the way we travel, but we have seen on the streets of London and other major cities around the world how technological advances can be exploited by multinational companies that seek to drive competitors off the road with a business model based on poor pay and conditions for drivers, exploitation of regulatory loopholes and predatory pricing that is made possible by huge venture capital and aggressive tax avoidance.”
In response, the Government set up a Taxi and Private Hire Task and Finish Working Group in September last year to consider the adequacy and efficiency of legislation and guidance concerning the licensing of taxis and private hire vehicles in England.
The task and finish group’s stated objectives are:

  • Identifying the current priority concerns regarding the regulation of the sector, based on evidence of impact and scale across England;
  • Considering, in particular, the adequacy of measures in the licensing system to address those issues;
  • Considering whether it would advise the Government to accept the recommendations made in the Law Commission’s May 2014 report on taxi and PHV legislative reform relevant to the issues, and;
  • Making specific and prioritised recommendations, legislative and nonlegislative, for action to address identified and evidenced issues.

The Government of course does not have a good track record of responding to issues in the taxi & private hire industries.  For example, it did not act on the Transport Select Committee’s recommendation in 2011 that, amongst other things, local authorities should impose conditions to the effect that taxis, private hire vehicles and their drivers must work principally in district by which they are licensed.  Equally it did not substantially act on the Law Commission’s report in 2014 recommending wholesale reform of the taxi and private hire regulator system.
There is a feeling however that the Government cannot continue to be complacent about this and particularly cross-border hiring.
The task and finish group is due to report back to Government shortly.
The Government is unlikely to enact a lot of the Law Commission’s recommendations as these are now seen as largely out of date and irrelevant given that the report is coming up to 4 years old.  It is also unlikely to go as far as TfL hopes it will particularly in respect of its “start or finish requirement” recommendation.
What the Government is likely to do however is introduce national standards for driving licences, extend enforcement powers that will allow licensing authorities to act against any vehicle and drivers operating in its area irrespective of where they are licensed and support the Licensing of Taxis and Private Hire Vehicles (Safeguarding and Road Safety) Bill.
The Government will need to enact primary legislation to introduce these measures which will take some time particularly given that Brexit is currently taking up most the Parliamentary time.  Whilst we are therefore unlikely to see immediate legislative changes it is almost certain that changes are coming, and the trade need to be aware of this because there will certainly be implications for licence holders around the country.


Taken from the April 2018 PHTM edition.  This article was written by Stephen Mccaffrey, Head of Kings View Chambers & Taxi Defence Barristers.