Closed consultation - Operator licensing

Land Transport Rule: Operator Licensing

Rule 81001

Overview

Land Transport Rules are law produced by Land Transport New Zealand for the Minister of Transport. Land Transport NZ drafts Rules in plain language to reach a wide audience. Draft Rules go through an extensive consultation process and are refined in response to consultation.

This overview accompanies and sets in context the yellow (public consultation) draft of Land Transport Rule: Operator Licensing (Rule 81001). This draft legislation proposes requirements for the operation of transport services and also proposes controls on drivers of a transport service vehicle.

If you wish to comment on this draft Rule, please see the page headed ‘Making a submission’. Submissions closed on 23 June 2006.

Contents of the overview

• What are Land Transport Rules?
• Why is this Rule being proposed?
• What new requirements are proposed by the draft Rule?
• Issues for discussion
• Matters to be taken into account
• How the draft Rule fits with other legislation
• Publication and information
• Appendix: Table Land Transport Amendment Act 2005: Order in Council items

 

What are Land Transport Rules?

Land Transport New Zealand (Land Transport NZ) was established on 1 December 2004 as a result of the merger of the Land Transport Safety Authority and Transfund New Zealand. One of its tasks is to produce Land Transport Rules under an agreement for Rule development services made with the Secretary for Transport, for signature by the Minister under the Land Transport Act 1998 (the Act).

Rules must be consistent with the objectives contained in the New Zealand Transport Strategy. These include safeguarding and improving safety and security, improving access and mobility, assisting economic development, protecting and promoting public health and helping to ensure environmental sustainability.

Land Transport Rules aim to:

• clarify
• consolidate and
• create

land transport law.

Rules are developed by means of extensive consultation, and each Rule is drafted in plain language to be understood by a wide audience and to help ensure widespread compliance with its requirements.

Consultation process

Land Transport NZ is committed to ensuring that legislation is sound and robust and that the consultation process takes account of the views of, and the impact on, people affected by changes proposed in Rules.

This publication, for your comment, has two parts:

1. an overview, and
2. the draft of Land Transport Rule: Operator Licensing (the draft Rule), for public comment.

This overview sets in context the proposals in the draft Rule. Please read the overview carefully and consider the effects that the proposed Rule would have on you, your business, or the members of your organisation. In particular, consider the benefits and costs that would result from implementation of the Rule.

Following preliminary discussions with key stakeholders, the former Land Transport Safety Authority initiated a review of the transport services licensing system with the release in December 1998 for public comment of the discussion document entitled Transport Services Operator Licensing Review. The document did not contain specific policy proposals, but outlined the key issues on licensing transport services and sought feedback on these and on a range of possible options.

In May 2001, the Authority released a separate discussion document, Courtesy Vehicle Services. This document was also posted on the Authority’s website, along with a list of its preferred policy proposals. The Authority’s preferred policy took into account the submissions made by industry groups and members of the public on the earlier discussion documents, and made recommendations to government. Cabinet approved these recommendations in October 2003.

Some of the proposals for changing transport services licensing policy required amendment of the Transport Services Licensing Act 1989. Those changes were included in the Land Transport Amendment Bill, which was introduced into Parliament in June 2004, and received the royal assent, as the Land Transport Amendment Act 2005 (the amendment Act), on 21 June 2005. Provisions relating to operator licensing that are not included in the draft Rule but are contained in the Act are summarised in Relationship of proposed Rule to Land Transport Amendment Act 2005.

The parts of the Act relating to commercial transport services are not yet in force. They will come into force by Order in Council when this Rule has been signed. (See the table in the Appendix to this overview, which lists the provisions that are to be brought into force by the Order in Council.

In August 2004, the Office of the Auditor-General (OAG) initiated a review to assess the effectiveness of the former Land Transport Safety Authority in controlling the taxi industry. A report was tabled in Parliament in June 2005 that made 61 recommendations to Land Transport New Zealand¹. Some of the recommendations requiring legislative change that would not involve a significant change (in terms of changes required to the IT system or costs to operators or drivers) have been incorporated into the draft Rule. Other recommendations would have a significant impact and require further analysis and decisions on policy, and are highlighted in the overview for comment.

The issues that are raised in submissions on the yellow draft of the Rule will be analysed and taken into account in redrafting the proposed Rule.

Following completion of the public consultation phase, the draft Rule will be submitted to the Ministry of Transport for government scrutiny. The final draft of the Rule will go to Cabinet for noting and will then be submitted for signature by the Minister.

Proposed timetable for implementation of the Rule

Subject to the Minister for Transport Safety's approval, it is proposed that the Rule will be signed and come into force in 2007.

This date needs to be aligned to changes in the Act, to be brought into effect by Order in Council.

Making a submission

If you wish to make a submission on the proposed Rule, please read the material headed Making a submission at the front of this document. Please quote the relevant proposal number in your submission.

The deadline for submissions has been extended to 23 June 2006. Submissions have now closed.

 

Why is this Rule being proposed?

Purpose of the draft Rule

This draft Rule consolidates and clarifies requirements that control the licensing of transport service operators and have been contained in the Transport Services Licensing Act 1989, the Transport Services Licensing Regulations 1989, compliance manuals and policy statements. Some new measures are also proposed. The Rule is being produced as part of the programme of converting regulations and other transport legislation to plain language Land Transport Rules.

Scope of the draft Rule

The amendment Act sets out the procedures and criteria that the Director of Land Transport (the Director) must follow or apply when licensing a transport service (See How the draft Rule fits with other legislation). It also updates and clarifies the definitions of the different types of transport service for which a licence is required and those services that do not have to be licensed.

Unless exempted from transport service licensing requirements, all transport service operators must be licensed. Obtaining a transport service licence (TSL) is dependent on an applicant meeting criteria and maintaining standards laid down in the amendment Act and in this Rule, and in continuing to maintain the prescribed standards.

The proposed Rule sets out the requirements that apply to holders of, or applicants for:

• a passenger service licence
• a rental service licence
• a vehicle recovery service licence
• a goods service licence.

It also applies to:

• the drivers of small passenger service vehicles, vehicle recovery service vehicles, and ‘dial-a-driver’ service vehicles
• hirers of rental service vehicles
• approved taxi organisations (ATOs).

 

What new requirements are proposed by the draft Rule?

The large majority of requirements in the proposed Rule are ‘rolled over’ provisions from the Transport Services Licensing Act and the Transport Services Licensing Regulations. However, some new requirements are proposed. These are either not in the existing legislation or are changes to the existing requirements. They are discussed below.

Transport service licence (section 2)

Certificate of Knowledge of Law and Practice

Background

The Certificate of Knowledge of Law and Practice (CKLP) requirement was introduced in 1989. It resulted from demands from industry groups who saw the need for establishing an objective industry standard for transport operators, to ensure they had an adequate knowledge of the laws and practices relating to the safe and proper operation of a transport service. Since 1 January 1992, unless specifically exempted, no one has been entitled to obtain a TSL or continue to hold a TSL unless that person, or some person who has or is to have control of the service, holds a CKLP. Holders of a TSL as at 31 December 1991 were exempt from this requirement.

A number of changes to the existing requirements for CKLP are proposed.

This proposal formalises the current practice and aligns CKLP requirements with those relating to Area Knowledge Certificates required of taxi drivers.

Cost impact

This proposed requirement is expected to have minimal compliance costs for industry.

 

Re-sitting of CKLP examination following disqualification

Background

A new provision in the amendment Act allows the Director to disqualify (for up to 10 years) an operator from holding or obtaining a TSL or from having any form of control of a transport service, following a licence revocation.

Road transport industry groups have supported a change to the law so that when a person’s TSL is revoked their CKLP is also revoked. This is because a licence revocation is a serious action that is made on the grounds that the licence holder or the person in control is no longer a fit-and-proper person. Those affected should not, therefore, be allowed to re-enter the industry easily, by re-applying for a TSL and paying a licence application fee.

Given that licence holders could be disqualified from holding or obtaining a TSL for up to 10 years following a licence revocation, this proposed requirement would have safety benefits by ensuring that the person has up-to-date knowledge of transport law and practice which will enhance compliance with the law.

This proposal is consistent with current driver licensing laws. A driver who is disqualified from driving for more than 12 months (eg, for serious drink-driving, or dangerous or reckless driving) must re-apply for a licence when the disqualification expires, and must pass the theory and practical tests in order to re-enter the driver licensing system.

Because the licence holder is not necessarily the CKLP holder for the service, the requirement to re-sit and pass the CKLP examination would apply even if another person is to have control of the transport service and that person already holds a CKLP.

Re-sit of CKLP examination as required by the Director

This proposal is consistent with the existing powers of the Director to require the holder of an Area Knowledge Certificate, which is required of taxi drivers, to re-sit and pass the Area Knowledge Certificate test if the Director believes, on reasonable grounds, that the taxi driver does not have an adequate knowledge of his or her operating area. Similar safety benefits to those resulting from Proposal 2 would be expected from this proposal.

Cost impact

Approximately 35 TSLs are revoked each year. It is not known how many of the former holders would re-apply for a TSL when their period of disqualification expired, but the number is unlikely to be significant. Requiring disqualified licence holders to re-sit the CKLP would currently impose a cost of $113 on each applicant ($98 for the examinations for the core and specialist modules and $15 for the CKLP handbook). This does not include travel costs and the costs of time taken to study the handbook (approximately two weeks) and to sit the three-hour examination.

Applicants for rental service licence to be exempt from CKLP requirement

Background

The rules governing the operation of rental services are highly prescriptive and have been criticised by the industry. To address these concerns, it is proposed that requirements for rental services be reduced and simplified. (See also Section 8: Rental services.) As this would further reduce the already limited range of topics covered by the rental service module and the limited number of questions that can be asked in the CKLP examination, it is proposed to exempt applicants for a rental service licence from holding a CKLP. Key legislative requirements relating to rental services would be communicated to rental service operators by way of education/information material.

Cost impact

Each year an estimated 150 new applications for a rental service licence are processed. This proposal would result in cost savings for the industry of at least $113 per application, amounting to a total cost saving of approximately $17,000.

Requirement to notify change in body corporate name

Background

Currently, there is no requirement for a body corporate that holds a TSL to notify the Director of a change of name or business address.

In a recent check of about 80,000 transport service licensing records, Land Transport NZ found that more than 2000 body corporate names had changed. In addition, about 3500 bodies corporate had been removed from the Companies Register, and 300 licence holders were deceased. It should be noted that the current provision prohibiting the transfer, assignment or lease of a TSL is reflected in section 30N as introduced by the amendment Act.

Inaccuracies in the transport licensing information affect the integrity of the transport licensing records and have resulted in duplicate and multiple licences being issued in the same name. They have also created difficulties in accurately identifying licence holders for investigation purposes.

Cost impact

From information provided by the Companies Office (Ministry of Economic Development) it has been estimated that about 660 licensees that are bodies corporate change their names each year. On notifying a change in its details, a licence holder would be provided with a replacement licence certificate with the updated details.

The current prescribed fee for processing a notification of change in licence details is $6. This fee may change as a result of the current review of transport service licensing fees (see also Review of fees).

This proposal would result in savings for some licence holders. The proposal would clarify for existing licensees that are bodies corporate that they do not have to re-apply for a new licence in the event of a name change (as some do now) and, consequently, licence holders would not incur the cost of applying for a new licence.

Certificate of responsibility

Background

Current practice

At present, when a vehicle is loaned to a transport service operator to be used under their TSL, the vehicle owner is required to obtain from the borrower a Certificate of Responsibility, to be retained for not less than 12 months by the vehicle owner. This certificate formally transfers legal responsibility for the operation of the vehicle from the vehicle owner to the operator who has borrowed the vehicle.

Nature and extent of problem

There are limitations to the usefulness, effectiveness and implementation of the requirements relating to the display of operator identification on vehicles and the Certificate of Responsibility, largely as a result of changes in industry practices. The introduction of more flexible ownership and use arrangements by transport service operators has resulted in the widespread use of leased vehicles, trailer-swaps, sub-contracting, and company consolidations. Vehicles can now be expected to operate under a different TSL at different times of the day, week, month or year, or over a longer period.

Similarly, the fact that the borrower of a vehicle is not required currently to carry the Certificate of Responsibility means that an enforcement officer has no way of validating at the roadside that the vehicle is being operated by someone other than the registered owner or the operator whose name is displayed on the vehicle.

Cost impact

Although the extent to which operators borrow vehicles is not known, the cost impact on industry of this proposal is expected to be minimal.

Display of TSL number

Background

Current practice

With the exception of rental service vehicles, all transport service vehicles are required to clearly display operator identification. The current requirements are as follows:

• Goods service vehicles: licence holder’s name and business location on the outside of both forward doors of the vehicle
• Large passenger service vehicles (buses): licence holder’s name and business location on the outside of the vehicle
• Taxis: the name, business location and telephone number of the ATO to which the licensee belongs, together with a unique fleet number for the vehicle, on the inside and on the outside of the vehicle
• Other small passenger service vehicles (shuttles, charter tours): operator’s name, business location and telephone number, together with the unique fleet number for the vehicle, on the inside and on the outside of the vehicle
• Vehicle recovery service vehicles: operator’s name, business location and contact telephone number of licence holder on the outside and the inside of the vehicle.

Nature and extent of the problem

Despite existing requirements to display operator identity, the Commercial Vehicle Investigation Unit of the New Zealand Police has highlighted operator identification as being a problem. In order to identify, at the roadside, the operator who is responsible for a vehicle, the Police generally rely on the information that has to be displayed on vehicle doors, or that is provided by the driver, or both.

Currently, the information required to be displayed does not include the vital unique identification information, ie, the TSL number, and the transport service driver does not have to produce evidence of the under which the vehicle is being operated.

The lack of active enforcement of vehicle signage requirements (given their relatively low impact on safety) has not provided an incentive to operators to keep their signs up to date, particularly for goods service vehicles. More importantly, current door signage does not prove that the operator is a licensed transport service operator.

The fact that the name under which a vehicle is registered is not necessarily that of the responsible operator limits the usefulness to Police of information on the motor vehicle registration database in identifying the responsible operator.

To be certain that a responsible operator is licensed appropriately, the Police would need to contact Land Transport NZ for verification.

It is currently an offence for the operator of any vehicle to use it in a transport service without displaying the operator's details. The proposed requirement to display a TSL number would be backed up by an equivalent provision in the Land Transport (Penalties and Offences) Regulations 1999.

This proposal would enable the Police to determine at the roadside the transport service licence under which the vehicle is being operated.

It also addresses a problem highlighted in the OAG’s report: namely, that there is no easy way for enforcement officers to determine at the roadside if a taxi service is licensed. The report recommended that taxi drivers be required to have evidence in their taxi of their passenger service licence, which is a TSL, or the one they are operating under². Having the TSL number displayed on the doors of a vehicle would quickly make this information available to enforcement officers, except in the case of a borrowed vehicle being used under a Certificate of Responsibility. In that event, the Certificate of Responsibility would provide an enforcement officer with the TSL under which the vehicle was being operated.

The proposed requirement to display a TSL number, as applicable to each type of transport service vehicle, is set out in the relevant section of the draft Rule.

Cost impact

This proposal would increase costs for existing operators of these vehicles, and for new operators, who would be required to add the TSL number to the signage on their vehicle doors, with the exception of private hire service operators and rental service operators. It is estimated that approximately 66,000 existing transport service vehicles would be affected. The cost of displaying the TSL number on a vehicle varies depending on the type of signage to be used, ie, painting the number on the vehicle door or the use of magnetic strips or self-adhesive stickers with pre-printed numbers. Information on the additional cost that this proposal would impose is welcome.

Issue for comment

An alternative for displaying TSL details, not as yet fully scoped, would be to require all vehicles used in a transport service to display a machine-readable label, affixed to a vehicle window. If this proves to be a practical option, it would be introduced as part of the proposed Operator Safety Rating Rule. Your comment is sought on this future proposal.

Requirement to notify application removed

Background

Currently, applicants for a passenger service licence or a vehicle recovery service licence must publish a notice about their application in a newspaper or newspapers approved for the purpose by the Director. The notice must be published twice, at an interval of not more than seven days. The notice must specify the name of the applicant, the nature of the service and the name of the person who is to have control of the service. The purpose of the notice is to allow members of the public to raise any concern about the applicant with the Director before a licence is granted.

Cost impact

Each year about 1050 people apply for a passenger service licence, and 40 people apply for a vehicle recovery service licence. At an estimated cost of $400 for two public notices, this proposed change would result in savings for applicants of an estimated total of $436,000 a year.

Small passenger service vehicles (section 3)

Removal of need for exemptions for operators of non-taxi vehicles

Background

Since 1989 all small passenger service vehicles have been treated, for operational purposes, as if they are taxis, and operators and drivers have had to comply with operating rules in the Transport Services Licensing Act. (A small passenger service vehicle is defined in the amendment Act and in Part 2, Definitions in the draft Rule.)

Operators of vehicles that are not used as taxis have had to apply to be exempted from the operating rules that do not relate to the service that they intend to provide. An operator wanting to provide, for instance, a shuttle or limousine service has had to apply for an exemption from the rules governing, for example, the signs that a taxi must display, the fare meter and the display of fare schedules.

An operator who chose to provide a particular category of small passenger service would be subject to the requirements in the draft Rule that applied to that category of small passenger service.

Cost impact

Each year, Land Transport NZ considers about 1200 applications for exemptions, involving an estimated 700 processing hours. Currently, applicants do not have to pay an application fee; however, a fee would be considered as part of the transport licensing fee review and would be introduced if the current regime were to continue. This proposal would mean that non-taxi operators would no longer have to apply for an exemption, with resulting savings for those operators.

Driver identification cards

Background

In its review of the monitoring of the taxi industry, the OAG questioned how easily a unique driver identifier comprising a combination of numbers only could be recalled by passengers. The draft Rule proposes a number of changes to the driver identification (ID) card requirements.

It is estimated that there are about 200 driver ID cards that currently display a unique driver identifier number only. These would be invalidated when the card was renewed and replaced with one made up of a combination of letters and, if required, numbers.

Cost impact

This proposal is not expected to impose an additional cost on existing holders of, or new applicants for, a driver ID card.

Display of card

Background

Currently, the relevant legislation is worded to require that certain information be displayed on the ‘inside’ and ‘outside’ of a vehicle. In the OAG’s report³, it was recommended that Land Transport NZ enlarge, or make more prominent, the expiry date on driver ID cards and require drivers to display their card in a prescribed place to ensure that it is visible to passengers.

Cost impact

This proposal is not expected to have any significant cost impact on operators and drivers.

Fare receipt

Background

Currently, when requested by the hirer, a driver of a small passenger service vehicle must issue an itemised receipt to the hirer, indicating the fare, any special charges, the driver’s unique identifier and the registration number of the vehicle.

As well as providing passengers with information about the hire, this proposal would align with the OAG’s view that land transport Rules support compliance with other legislative obligations, in this case, those of the Inland Revenue Department.

Cost impact

This proposal would impose additional costs on licence holders, because the new items would need to be included in their existing fare receipt format, whether hand-written or electronically printed. If a receipt printer is connected to the fare meter, it would need to be re-calibrated to include the new items. Electronic receipt printers already have this information. Information on the additional cost that this proposal would impose would be welcomed.

Smoking in vehicle

The requirement relating to smoking in a small passenger service vehicle has not been carried over into the draft Rule because a similar provision already exists in primary legislation, namely section 9 of the Smoke-free Environments Act 1990.

 

Taxi services (section 4)

Requirement to display information in Braille

Background

The report of the Human Rights Commission on its 2005 inquiry into accessible public transport⁴stated that blind and visually-impaired taxi users feel vulnerable and anxious because they are unable to independently confirm the driver’s name and that of the taxi company.

A joint submission made to the Parliamentary Select Committee considering the Land Transport Amendment Bill, by the Royal New Zealand Foundation of the Blind and the Association of Blind Citizens of New Zealand Inc., recommended that large print and Braille labels be required in all taxis licensed to operate in New Zealand. These labels should display the unique fleet number, company name and telephone number. It was argued that this is required to provide critical information and, hence, improved security for visually-impaired passengers.

Consequently, the new section 30B introduced by the amendment Act requires the holder of a transport service licence under which a taxi is operated, and the driver of that taxi, to ensure that the name of the ATO, its telephone number for complaints and the unique fleet number assigned to that taxi are provided in Braille.

The display in Braille of driver information was not proposed, because it was not considered to be a practical and reasonable requirement. This is because a taxi vehicle may be double- or triple-shifted and used by several drivers in a day. Also, the ATO’s name and vehicle fleet number is considered to be sufficient for identifying the driver.

A transition period may be considered to allow production of the cards.

Cost impact

This proposal would impose significant compliance costs on the taxi industry. At an average cost of $45 for a plate, it would cost a vehicle owner $90 if two plates were required to be displayed in their vehicle. Based on an estimated total of 8200 taxis, there would be a one-off cost of $738,000 to the industry. Assuming that five percent of plates had to be replaced each year because of wear and tear, the annual ongoing cost to operators is estimated at $36,900.

Strengthened area knowledge certificate and English language requirements for metropolitan areas

Background

Currently, taxi drivers are required to hold an appropriate area knowledge certificate (AKC) to be allowed to drive a taxi. The AKC must relate to the operating area of their ATO. As a result of public and industry concerns about taxi driver standards, the Minister of Transport requested the Land Transport Safety Authority to review the area knowledge and English language requirements for taxi drivers in 2001, with a view to improving the system.

A number of changes were identified by the review, as requiring either legislative or non-legislative measures. A key legislative change that has been approved by government provides for an increase in the area knowledge requirements for taxi drivers in major metropolitan centres. Complaints that have been received about taxi drivers not knowing the way to a destination have related largely to taxi services operating in the larger centres. This is not surprising, given that driving a taxi in a metropolitan area is a more demanding task than driving one in a smaller centre or rural area.

In addition to proposals for changes to strengthen area knowledge requirements, the draft Rule carries over the provisions of the Transport Services Licensing Regulations 1989 that set out the Director’s powers to require a taxi driver to be retested, if the Director believes, on reasonable grounds, that the driver does not have an adequate knowledge of his or her operating area.

Recent analysis has found, however, that the size and complexity of Auckland, Wellington and Christchurch justify a strengthening of the area knowledge of drivers operating in these cities. This is not the case for Hamilton and Dunedin. The respective AKCs that currently apply to these two cities already cover the whole metropolitan area and are considered to be adequate for now. This situation would be reviewed as and when it is appropriate.

The proposals would mean that taxi drivers (existing and new) in Auckland would be required to hold AKCs for all five areas, namely, North Shore City (Code 105), Waitakere City (106), Auckland City (107), Manukau City (108) and Papakura District (109). Drivers in Wellington would be required to hold AKCs for Upper Hutt City (320), Lower Hutt City (321), Porirua City (322) and Wellington City (323). For drivers in Christchurch, the metropolitan area would include Waimakariri District (406), Christchurch City (407) and (currently) Banks Peninsula District (408).

Cost impact

The proposal to strengthen the AKC regime for taxi drivers operating in Auckland, Wellington and Christchurch would impose a significant compliance cost on new drivers wanting to operate in these centres and on some existing drivers who do not have all the necessary certificates. Taxi drivers who currently operate out of Auckland Airport are already required by Auckland Airport Ltd to hold all five AKCs; consequently a large majority of taxi drivers in Auckland already hold all the required AKCs. However, this is not the case in Wellington and Christchurch, where the majority of taxi drivers only hold the AKC for the area they predominantly operate in.

An estimated 2150 existing taxi drivers (500 in Auckland, 1000 in Wellington and 650 in Christchurch) and 1600 new drivers (1100 in Auckland, 200 in Wellington and 300 in Christchurch annually) would have to obtain the additional AKCs required. The average cost of sitting an AKC test is $120; each test takes about three to four hours to complete. This does not include the time spent by the candidate studying the material provided to them.

The total estimated cost of this proposed change is $756,000 (one-off) for existing drivers and an additional cost of $672,000 a year for new drivers.

This proposal may impose additional costs on ATOs who will continue to be responsible for ensuring that their members and their drivers hold the required AKCs and maintain an adequate area knowledge. Comments on the costs involved are sought.

Further proposals for comment

Two further possible changes relating to the AKC requirements are detailed for comment in Issues for discussion. These would restrict the requirement for AKCs to larger cities and towns, and allow the Director to approve AKC boundaries by Gazette notice.

Requirement to sit English test

Background

Taxi passengers have an expectation that a driver will know how to get them to their destination without delay and be able to speak and understand English sufficiently to take instructions. Currently, the Director may require a taxi driver to pass an area knowledge test for a specific area, if the Director believes that the driver does not have adequate knowledge of any operating area of the ATO for which they are driving. This requirement could be applied to a driver who has already held an AKC for the area.

Because the AKC tests must be conducted in English, they are also being used to assess the ability of a taxi driver to understand English. Taxi drivers, therefore, are not required to pass a separate English test.

The report of the OAG recommended that Land Transport NZ review the effectiveness of having an applicant’s English language ability assessed as part of the AKC test⁵. However, it should be noted that a comprehensive review of the AKC requirements was carried out by the Land Transport Safety Authority in 2001. Following this review, the English component of the AKC test in metropolitan areas was further strengthened. Changes were made to the questions and the number of questions was increased. Questions were added on the objectives of pick-up and destination points and on taxi operating rules. These changes effectively doubled the oral component of the test.

Cost impact

The proposed change is not expected to have significant cost impacts because the number of people who would be required to be tested for their English competency would be small, given that the English component of AKC tests was further strengthened following the 2001 review.

Shuttle services (section 5)

Background

Section 5 of the proposed Rule sets out the requirements that would apply specifically to shuttle services. These are largely those operating rules that currently apply to a small passenger service vehicle under the Transport Service Licensing Act. These rules have been carried over into the draft Rule. The draft Rule retains the current requirement for shuttles to operate between defined starting and end points. These points must be main transit points, such as (but not limited to) an airport, bus or ferry terminal, or a railway station. For example, a shuttle may pick up passengers from the airport and set them down anywhere, or pick up passengers from anywhere but set them down only at the airport or railway station. The shuttle operator would continue to have to register details of the starting and end points of the service with the Director.

The following are proposed new requirements for shuttle services.

Vehicle size

Schedule of shuttle fares

Cost impact

The operating rules for shuttle services as set out in the draft Rule are not expected to have any significant cost impact on the industry, as they are similar to those that currently apply to those services.

Private hire services (section 6)

Proposed requirements relating to private hire services

Background

Section 6 of the draft Rule sets out the proposed requirements that relate specifically to private hire services. Although these are now spelt out as a separate category of small passenger service, they are largely the rules that currently apply to these services.

Provision of private hire service operator information to enforcement officer

In addition to displaying the existing operator information, the draft Rule proposes that a TSL number be displayed on transport service vehicles (other than rental service vehicles) (see Proposal 7). However, it is considered inappropriate to require vehicles operating a private hire service (such as limousine and private charter services) to display operator information. Hence, the proposed requirement to produce the information on demand.

Cost impact

This proposal is not expected to impose significant costs on private hire service operators.

Approved taxi organisations (section 7)

It has been recognised that because ATOs have influence over the standards of safety and service of their members and drivers, the role of ATOs should be further strengthened by enhancing their accountability for the standards met by their members. In addition to the current requirements, several new requirements are proposed, which are aimed at strengthening the role of ATOs.

Comments are sought on these proposals, including any additional costs that they would impose.

CKLP for responsible officers of ATOs

The amendment Act provides for the Director to grant an application to be an ATO if the Director is satisfied, among other things, that a person who will have, or is likely to have, control of the proposed ATO holds the appropriate certificate (if any) required by the regulations or the rules.

Similarly, the OAG's view is that those who control an ATO must be aware of their legal obligations. Consequently, it is recommended⁶ that those persons be required to hold a qualification similar to the CKLP so as to ensure that directors have adequate knowledge of the regulations and rules that apply to their taxi organisation, to passenger service licence holders and to drivers. This recommendation is reflected in the draft Rule. Because this is a new requirement, the content of the CKLP for ATOs will be developed by Land Transport NZ in conjunction with the taxi industry and the appropriate industry training organisation.

The draft Rule also proposes that the Director may require persons who have control of an ATO to re-sit and pass a CKLP examination if the Director believes that a CKLP holder in an ATO does not have adequate, relevant knowlege of the laws and practices. (See Proposal 3.)

Ensuring that drivers hold current licences, passenger endorsements and driver ID cards

Background

Members of ATOs may or may not drive a taxi themselves. Some of those who drive may also double- or triple-shift their vehicle, either by leasing out the vehicle or employing a driver. Others may own more than one vehicle and lease the vehicles out or employ drivers to drive them. There is currently no requirement for ATOs to ensure that all their drivers hold current driver licences, endorsements and driver ID cards.

Since 1999, driver licences have been issued for up to 10 years, and P endorsements and driver ID card have been issued on a yearly or five-yearly basis. Some ATOs already have a notification system in place to remind their drivers to renew these documents when they are close to the expiry date, including requiring their drivers to notify them of a change in their licence status that has resulted in a suspension, revocation or disqualification.

ATOs have the option of registering with Driver Check, a secure Internet site operated by Land Transport NZ, which allows individuals or companies to check the licence status of their drivers. To be part of this scheme, a company must first register with Land Transport NZ and provide details of its drivers (full name, date of birth and driver licence number).

Land Transport NZ automatically advises a company if the licence status of a registered driver changes (ie, when a licence has expired, or has been suspended or revoked, and when a driver is disqualified from driving). This notification can be made by post, fax or email.

Cost impact

This proposal may impose additional costs on ATOs who choose to register with Driver Check.

The cost to an ATO of signing up with Driver Check would depend on the number of registered drivers for which information was required. The cost for each driver registered with Driver Check is currently $1.52 a year. A separate charge applies (currently $1.52) when a driver is added or removed from Driver Check or for an on-line query about a driver. Detailed information about Driver Check is available at: drivercheck.landtransport.govt.nz/DriverCheck/Information.aspx

Requirement for ATOs to notify changes to business address and telephone number

Background

Currently, TSL holders are required to notify the Director of any change in the business or residential address of the transport service, and any change in the person(s) having control of the service or the business or residential address of the person(s). ATOs, however, are required to notify only a change of responsible officers.

This proposal would align with the requirement for ATOs to ensure the availability of a 24-hour, seven-day service.

Cost impact

This proposal is expected to impose minimal costs on ATOs. Some ATOs already voluntarily notify the Director using either a standard form or letter.

Requirement to record drivers’ log-on and log-off times

Background

Taxi drivers, along with other commercial drivers and drivers of certain heavy motor vehicles, are subject to work-time restrictions. Historically, drivers and operators have been liable for driving hours and logbook offences.

Recent changes made in the amendment Act, introducing the ‘chain of responsibility’ principle, recognise that individuals (other than the driver or operator) in the transport chain, including a taxi organisation, may contribute to a range of breaches of transport law and should also be liable for those breaches. Areas targeted by the ‘chain of responsibility’ principle in the amendment Act include overloading, speeding, use of unlicensed services and work-time breaches. With the exception of the expanded overloading offence, which came into effect when the amendment Act was enacted, the ‘chain of responsibility’ offences will come into force shortly after this Rule and the draft Land Transport Rule: Work Time and Logbooks are finalised.

This proposed requirement would provide an explicit link to the new ‘chain of responsibility’ requirements in primary legislation. It would be expected to yield some safety benefits, because it would deter taxi drivers from exceeding their work time and driving while fatigued.

ATOs would also be able to identify and verify that a particular driver was on duty at the time an alleged incident of serious improper behaviour by a driver had occurred. Taxi drivers would continue to be responsible for complying with work-time requirements and ensuring the accuracy of their logbook entries, which could be quickly checked against the ATO’s records.

Cost impact

Currently, ATOs must ensure, through a telephone communications system on which bookings can be made, that the services of their members who operate taxis are available to the public 24 hours a day, seven days a week. By means of a driver roster, ATOs already have in place a system to record when their drivers’ log-on and log-off each day. Comment is sought on any additional costs to ATOs of this proposal.

Reporting of serious improper behaviour

Background

The ability to take swift action against a driver who is no longer a fit- and-proper person to drive a taxi can be hampered by a lack of timely information. The report of the OAG recommended that Land Transport NZ ensure that ATOs report certain serious complaints, and that ATOs and passenger service licence holders be required to notify offences committed by taxi drivers that they become aware of⁷.

In 2003, 413 complaints were reported directly to the Land Transport Safety Authority; some of these resulted in licence suspension leading to the driver’s licence being revoked. Currently, Land Transport NZ relies on the Police, media reports and its own intelligence for this information.

The following proposal would strengthen the complaints process by ensuring that early information about drivers, who were the subject of complaints or termination of employment as a result of serious improper behaviour, was made available to the Director. This could be done by means of a telephone call or email message to the nearest Land Transport NZ regional office.

Cost impact

The proposed new responsibilities would impose costs on ATOs. The costs of compliance for individual ATOs would depend on the extent to which they are complying with current requirements and the systems that have been put in place to monitor their drivers’ standards, the vehicles used, and the volume of serious complaints they receive.

Multiple taxi signage

Background

Recent changes made in the amendment Act require the Director, when approving an application for an ATO, to be satisfied that its proposed signage is sufficiently distinguishable from the signage of any other ATO operating in the same area.

Although the protection of the branding and image of a company is strictly a commercial law issue, this provision recognises that an ATO’s signage may have implications for the safety and personal security of taxi users. When a complaint or report is made to Land Transport NZ or the Police involving assault of a passenger by a driver, it is important that the complainant is able to clearly identify the company to which the taxi belongs.

Currently, an ATO is not prohibited from introducing additional signage to target different groups of customer, with differential fares. Although not a widespread practice, there are currently a small number of ATOs in Christchurch, Wellington, Blenheim, Hamilton and Gisborne with more than one signage and fare schedule.

Cost impact

These proposals will have cost implications for those operators who currently operate under a brand name that is different from the ATO name. They will need to ensure their vehicles display the signage of the particular brand name they operate under and its associated fare schedule and telephone number.

Enquiries made with Telecom have indicated that new businesses are entitled to one free listing (for one of their premises) in the White Pages directory. For existing businesses, a listing for the metropolitan centres costs between $66 (Wellington) and $84 (Auckland).

Comments are sought on the costs that this proposal would impose on ATOs.

Requirement for taxis to display correct signage

If an ATO has more than one brand name, it would be required to ensure that its members who were operating under a particular brand name displayed the signage for that brand name.

Cost impact

The cost to an ATO of this proposal would depend on the number of brand names operated by the ATO and the extent to which the ATO currently checks vehicles used by their members to establish whether they are meeting existing requirements relating to maintenance of vehicle standards.

Registration of fares

Background

Current legislation requires that fares, charges and multiple hire discounts be registered with the Director before being displayed in or on any small passenger service vehicle. It also provides for an ATO to register a uniform fare in respect of all small passenger service vehicles operated by the ATO or by its members.

Cost impact

Because this proposed requirement clarifies and formalises current practice, it is not expected to impose any additional cost on ATOs.

Requirement for 24-hour/seven-day service

Cost impact

See comments under Proposal 23.

Schedule of fares inclusive of GST

Cost impact

This proposal is not expected to impose significant cost on the majority of taxi operators. This is because, although the format of the fare schedule is not currently prescribed in law, it has been used by Land Transport NZ (and earlier, the Land Transport Safety Authority) since 1989 when advising ATOs on how fares are to be displayed on a fare schedule.

Rental services (section 8)

The requirements currently applying to rental services are highly prescriptive and have been criticised by the industry. To address these concerns, the draft Rule sets out a number of proposals that are aimed at simplifying the requirements relating to rental services.

It is proposed that the existing prescriptive nature of the wording in the Agreement to Hire Rental Vehicle, as set out in the Transport Services Licensing Act, be removed.

Agreement for hire of rental service vehicle

Schedule 3 of the draft Rule sets out the items that must be included in the agreement (without prescribing the wording itself). Operators would have the flexibility of including other items that they considered to be appropriate.

Insuring a hired vehicle

Register of vehicles and hirers

Because the items that have to be recorded in the register are also included in the rental agreement, the register could comprise all rental agreements made during the most recent three-year period, and kept in chronological order. Comments are sought on this.

Cost impact

Proposals 28 to 30 are simplifications of existing requirements and may result in some compliance cost savings for some operators.

Hirer’s liability for infringement fees

Background

It is common practice for rental car firms to advise the Police of the details of a customer who has incurred an infringement fee while using a rental vehicle. Because of the difficulties experienced by the Police (as well as local authorities and airport companies) in enforcing the payment of infringement fees by people who have returned to an overseas address, many offence notices are being waived. These infringements include speed camera offences and red light running detected by a camera, and parking offences.

Several thousand speed camera offence notices are waived each year because the driver was a visitor to New Zealand, and one local authority waives about 30 percent of all parking notices for this reason. It could be argued that the waiving of offence notices on this scale undermines the integrity of the traffic law.

Following the practice in European countries and in Australia, some rental service operators include provisions in their rental contracts that transfer liability for speed camera and parking fines to the hirer, and provide for them to be charged to the hirer’s credit card, when the rental has been paid for by this payment method. The Transport Services Licensing Act does not explicitly provide for infringement fees to be charged to a hirer’s credit card. The amendment Act has rectified this, and has provided for the Rule to specify measures to safeguard the hirer’s rights.

Cost impact

Rental service operators who choose to charge an infringement fee to a hirer’s credit card are likely to incur an administrative cost, which they would want to recover by means of imposing an administration fee on affected hirers.

Comment is sought on whether the administration fee should be prescribed (as are fees relating to vehicle towage for parking infringements and vehicle impoundment offences) and if so, what would be a reasonable fee. In addition, should operators be allowed to charge a hirer even if the infringement fee is not ultimately paid by credit card?

Vehicle recovery services (section 9)

Responsibilities of vehicle recovery service operators and drivers

Background

All the existing licensing provisions for vehicle recovery services have been carried over into this draft Rule. In addition, two new requirements are proposed.

This proposal addresses complaints about tow yard staff using intimidating tactics and behaving in an inappropriate manner towards members of the public.

This proposal is in line with a similar requirement that applies to the driver of a taxi or shuttle.

Cost impact

Proposals 32 and 33 are not expected to impose compliance costs on vehicle recovery service operators and drivers.

Other vehicles and services (section 10)

‘Dial-a-driver’ drivers to wear photographic ID

Background

Since 1989, the driver of a small passenger service vehicle or a vehicle recovery service vehicle has been required to hold and display a photographic driver ID card. This requirement was stipulated in the Transport Services Licensing Act. Because ‘dial-a-driver’ services have not been required to be licensed as a passenger service, their drivers are currently exempt from this requirement. With the recent inclusion of ‘dial-a-driver’ services as a ‘passenger service’ in the amendment Act (to take effect when this Rule comes into force), it is proposed to align the ID requirements for drivers engaged in ‘dial-a-driver’ services with those of other small passenger service vehicle drivers.

Since 1999, ‘dial-a-driver’ drivers, along with all other drivers engaged in a passenger service, have been required to hold a P endorsement. This not only ensures that they have specialist knowledge and skills required for the carriage of passengers, but also subjects them to fit-and-proper person requirements, including five-yearly Police vetting.

Requiring ‘dial-a-driver’ drivers to also hold a photographic driver ID card would mean that they would be subject to an annual fit-and-proper person assessment, including a Police check. Requiring the drivers to wear the ID card would also enable them to be easily identified by their passengers, and would provide vital information for reporting a complaint. This, in turn, should provide passengers using this type of service with a greater sense of safety and personal security.

Cost impact

This proposed change will impose additional costs on ‘dial-a-driver’ drivers, who will be required to pay for the photo ID card as well as four additional annual Police checks. Currently, drivers can apply for a one-year or five-year P endorsement. On the basis that a driver applies for a yearly P endorsement, the additional cost that will be incurred is $155.30 (ie, five ID cards and four Police vettings) over five years, or $31 a year.

It is estimated that each year about 100 drivers in ‘dial-a-driver’ services would need to apply for a photo ID card, incurring a total cost of $3,100 a year. As some drivers would apply for a five-yearly endorsement, the costs for those drivers would potentially be lower.

Exempt passenger services (section 11)

Introduction

The amendment Act consolidated the provisions of the Transport Services Licensing Act and the Transport Services Licensing Regulations relating to the operation of transport services. The amendment Act defines the various types of transport service and the vehicles that operate those services. It also makes provision for services and vehicles to be exempt from transport service licensing requirements by way of requirements set out in the Rule. This is intended to ensure a more flexible and efficient approach when changes are needed in relation to whether vehicles operating a transport service need to operate under a transport service licence.

What does ‘exempt’ mean?

The exempt passenger services set out in section 11 of the draft Rule are effectively exempt from all licensing requirements relating to small passenger services. Operators of these services are exempt from holding a passenger service licence (and, therefore, from the CKLP requirement). Drivers involved in exempt services are not required to hold a P endorsement or a photo ID card, and are, therefore, not subject to annual fit-and-proper person assessment, including Police vetting. Vehicles used in these services do not have to be certified as a passenger service vehicle (PSV) and comply with PSV standards. They are also not subject to six-monthly Certificate of Fitness inspections and signage requirements.

Despite the above exemptions, existing exempt services are subject to certain conditions specified in the Transport Services Licensing Act and the Transport Services Licensing Regulations. These relate to vehicles, drivers and payments. These conditions have largely been carried over into the proposed Rule. However, a number of new or changed requirements are proposed in the draft Rule, and these are set out below.

Clarification of existing requirements

Currently, drivers of exempt passenger services are allowed to receive payments for reimbursement of operating costs. The draft Rule clarifies this to mean the running costs of the vehicle, when it is provided by a driver or a staff member, but excluding payment made to the driver for carrying the passengers.

Land Transport NZ welcomes your comments on the Rule proposals.

Criteria for licensing passenger service vehicles

Passenger services are licensed on the basis of vehicle size and vehicle usage. Currently, a passenger service licence is required if the vehicle used is designed or adapted to carry 12 or fewer persons (including the driver) and operates for ‘hire or reward’, or the vehicle has more than 12 seats regardless of whether it operates for hire or reward.

Hire or reward

The term ‘hire or reward’ has not previously been defined in transport legislation, and interpretation of the term has largely relied on case law. To provide greater certainty for new and existing operators as to whether their service needs to be licensed, the definition of ‘passenger service’ has been clarified in the amendment Act (section 4, Interpretation) and in Part 2, Definitions of the draft Rule to include the carriage of passengers on any road:

• that involves a specific charge on passengers for transport, including part payments to cover fuel and donations (which are expected as a condition of carriage), or
• by a person or an organisation that is funded by another person or organisation specifically for the provision of transport, or
• in which the transporting of passengers is an integral part of, or reasonably necessary to provide, another service or activity (other than a transport service) for which payment is made.

Size of vehicle

For all existing exempt passenger services, with the exception of home or community support services, the vehicles allowed to be used at present are limited to a ‘private motorcar’, which is defined as a motor vehicle with up to nine seats.

The advantages of this proposal are:

• it aligns with the commonly-used distinction between a small passenger service vehicle and a large passenger service vehicle, which is one of two criteria for the purpose of passenger service licensing
• it would provide mobility for up to 12 people at a time, with positive implications for time and petrol cost savings, and environmental impacts
• it allows the use of larger vehicles to cater for multiple wheel-chair needs.

However, it may be preferable to retain the status quo and restrict exempt passenger service providers to the use of smaller vehicles that are designed or adapted for carrying nine or fewer people. The advantages of restricting these vehicles to a maximum of nine persons (including the driver) are set out in Issues for discussion, and your comments are sought on this issue.

Charitable organisations, local authorities and district health boards

Background

Currently, passenger services operated by or under the control of a district health board (formerly area health boards), local authority, or an incorporated charitable organisation are exempt from licensing. The vehicles used must be private motorcars driven by volunteers and the only payments made in respect of provision of the service must be for reimbursement of operating costs.

It is proposed to roll-over these exempt services into the draft Rule, with modifications to widen the conditions that currently apply.

A comparison of the main features of current and proposed regimes is shown in Table 1 below.

Table 1  Current and proposed exemption regimes for passenger service vehicles operated by charitable organisations, local authorities and health boards

Current regime	Proposed regime
Must use private motorcars only (with up to 9 seats)	Must use private motor vehicles with no more than 12 seats (including the driver), provided by the driver or the organisation
Must use volunteer drivers only	Must use volunteer drivers or staff members of the organisation
Only payment made is for reimbursing operating costs	Only payment permitted to be made to a volunteer driver or staff member who provides the vehicle must be: made by the organisation; and for the purpose of reimbursing costs of running the vehicle
Organisation may not receive donation from passengers for the transport provided	An incorporated charitable organisation or organisation registered under the Charities Act 2005 may receive a voluntary donation from passengers for the transport provided
Organisation may not receive external funding for the transport provided	Organisation may receive external funding for the transport provided

Cost impact

This proposal effectively clarifies and relaxes the requirements that currently apply to incorporated charitable organisations, local authorities and district health boards. It is not expected to impose additional costs on these organisations.

Carpooling arrangements

Background

Currently, passenger services that use motorcars in which people are transported to or from their place of employment or business under a cost-sharing arrangement between occupants of the vehicle are exempt from passenger service licensing.

This proposal would align the proposed provision with an existing provision in Land Transport (Driver Licensing) Rule 1999 that exempts those involved in a carpool arrangement who travel to and from a place of education, employment or business from holding a passenger endorsement. It is consistent with several of the objectives of the New Zealand Transport Strategy, in particular, improving access and mobility.

There has been some discussion about extending the Rule even further to enable carpooling to be used for travel needs within the wider community. (See Issues for discussion).

Cost impact

This proposal is expected to reduce costs for those using carpools for the additional specified purposes.

Transporting of school children funded by private transport allowance

Background

The Transport Services Licensing Regulations exempt from licensing the transporting of school children by parents in return for a Ministry of Education private transport allowance, which may be pooled and paid to the parents concerned. The regulations do not specify the size of vehicle that can be used for this purpose.

Cost impact

This proposal is not expected to have any cost impact on parents who transport their children in return for an allowance from the Ministry of Education.

Pre-school centres and school-related activities

Background

Currently, pre-school centres and schools that provide transport for their pupils in conjunction with a pre-school/school-related activity, using teachers or parents as drivers, and meet any of the hire or reward criteria (for example, charge a fee or accept a donation for the transport) must be licensed. Consequently, their drivers must also hold a P endorsement.

Previously, regulation 4(2)(a) of the Transport (Drivers Licensing) Regulations 1987 provided for a car licence holder to drive a private motorcar that was being used for reward to convey children and their escorts to or from any kindergarten, playcentre, other institution providing pre-school education, or school or any related activity.

This provision was inadvertently omitted when the Land Transport (Driver Licensing) Rule 1999 came into force and the regulations were revoked. Schools have since requested that this provision be reinstated, which would effectively exempt their drivers from holding a passenger endorsement and incurring associated costs.

The proposed exemption of the transport service from complying with licensing requirements would also exempt the drivers concerned from holding a P endorsement on their driver licence.

A comparison of the key features of the previous and proposed exemption regime is shown in Table 2.
Table 2  Previous and proposed exemption regimes for passenger service vehicles operated for pre-school and school activities

Previous regime	Proposed regime
May use private motorcars only (with up to 9 seats)	Must use a vehicle with up to 12 seats (including the driver)
May use any licensed driver	Driver must be a staff member of the institution or person approved by the institution, or a parent, guardian or caregiver of one of the children being carried
Transport is to and from any kindergarten, playcentre, other institution providing pre-school education, or school or any related activity	Transport is to and from any activity of a kindergarten, playcentre, or other institution providing pre-school education, or school or any related activity
Drivers may receive reward for carriage	Only payment to be made to the person who provides the vehicle must be: made by the pre-school/school; and for the purpose of reimbursing costs of running the vehicle
Organisation may not receive external funding	Organisation may receive external funding for the transport provided

Cost impact

The proposed exemption of the transport service from complying with licensing requirements would also exempt the drivers concerned from holding a P endorsement on their driver licence.

Statistics from the Ministry of Education indicate that, as at 1 July 2004, there were 4280 early childhood services (including kindergartens, playcentres, Kohanga Reo, and play groups), and 2647 schools in New Zealand.

It is not known how many schools or pre-school centres are currently licensed to operate a passenger service. The number and size of vehicles and the number of drivers involved are also not known. It is, therefore, difficult to estimate the total cost savings that would result from this proposal. However, on the basis of current licensing fees, the potential cost savings are $58.20 (licence application and Police vetting fees) for a school (one-off) and $106.80 (P endorsement application, driver ID card and Police vetting fees) for a driver (annually). In addition, annual inspection cost savings for each vehicle are estimated at approximately $100.

Passenger services for home or community support

Background

The amendment Act provided for the exemption of home or community support from passenger service licensing. This provision has been carried over into the draft Rule, as follows:

This is not a proposed new exemption.

Part 2 Definitions

Background

The draft Rule aligns definitions that have been changed in the amendment Act with the Rule. Existing definitions for terms used in this draft Rule, when appropriate, have been carried over from the amendment Act and other Land Transport Rules. Some changes to definitions are proposed and these are detailed below.

 

Issues for discussion

Issue 1           Enforcement of some taxi service rules by parking wardens

Currently, when plying for hire and when accepting a hire, a taxi driver must ensure that his or her vehicle does not impede or interfere with other traffic or create a traffic hazard. In addition, a taxi driver must not accept a hire, other than by radio or phone, within 20 metres of a designated stand on which a taxi is available for hire and that is on the same side of the road as the prospective hire. The Police and delegated Land Transport NZ staff are currently empowered to enforce these rules.

Local authorities have highlighted that some taxis are causing traffic management problems while plying for hire, particularly in major cities. Comments are sought as to whether it is appropriate for parking wardens also to be empowered to enforce breaches by stationary taxis impeding traffic.

The traffic offences that are enforced by parking wardens are listed in Schedule 2A of the Transport Act 1962 and do not include offences relating to taxis plying for hire. Amendments to Schedule 2A would be made by regulation to include the new offences, if this is considered appropriate.

Issues 2 and 3             Area knowledge certificates

Comment is sought on two further possible changes relating to AKCs. These would restrict the requirement for AKCs to larger towns and cities, and allow the Director to approve the boundaries for AKCs by Gazette notice. These proposals will be considered for including in the draft Rule if they receive enough support.

Issue 2             AKC to be required in larger towns and cities only.

Complaints about taxi drivers not knowing how to get to their passenger’s destination tend to be more prevalent in the larger towns and cities than in small towns. It has been suggested that the requirement for taxi drivers to hold an AKC should, therefore, be limited to larger and more complex towns and cities, including popular tourist destinations, as is the case overseas.

There are currently 76 AKCs, and these are based on local authority boundaries. It is proposed that this number be reduced to 25, to apply to the following towns and cities: Ashburton; Auckland (North Shore, Waitakere, Auckland City and Manukau); Blenheim; Christchurch; Dunedin; Gisborne; Hamilton; Hastings; Invercargill; Levin; Masterton; Napier; Nelson; New Plymouth; Palmerston North; Pukekohe; Queenstown, Rotorua; Taupo; Tauranga; Timaru; Wanganui; Wellington (Kapiti, Lower Hutt, Porirua, Upper Hutt and Wellington City); Whakatane and Whangarei.

This would significantly reduce compliance costs for taxi drivers in smaller towns, and allow Land Transport NZ to better use its limited auditing and monitoring resources for targeting taxi drivers and AKC providers in the larger centres of population. It would also reduce costs for ATOs in the smaller towns who are currently required to ensure their drivers hold an AKC for their registered operating area, and maintain an adequate knowledge of the area.

Issue 3            Director to approve AKC boundaries by Gazette notice

Currently, an ATO is required to notify the Director, in writing, of its operating area by reference to local authority boundaries. There is a requirement for persons who propose to operate a passenger service (including a taxi service) to notify details of the service, including its areas of operation, to every regional council in whose region the service is to operate. AKC areas currently relate specifically to the operating area, as notified to the appropriate regional council.

The expansion of urban development in some cities has made existing boundaries inadequate for AKC purposes. For example, it is considered that the AKC for Christchurch should be extended out to such areas as Rolleston and Rangiora. These areas are currently part of the Selwyn District and Waimakariri District respectively.

It is proposed that the Director be empowered to approve AKC boundaries by Gazette notice. This would allow for some areas to be included as part of a growing town or city, as and when required.

Issue 4            Size of vehicles operating exempt passenger services

As discussed in Proposal 35, existing exempt passenger services, with the exception of home or community support services, can use only vehicles that have a maximum of nine seats (including the driver). The draft Rule proposes that all exempt passenger service providers be allowed to use small passenger service vehicles, as defined in the amendment Act and the draft Rule, namely, vehicles designed or adapted to carry 12 or fewer persons (including the driver).

The advantages of this proposal are set out in Proposal 35. However, there are also reasons that would justify maintaining the status quo.

These are:

• existing exempt services are currently restricted to using motorcars (defined in the Transport Act 1962 to mean a motor vehicle designed principally for the carriage of not more than nine persons, including the driver)
• there may be few circumstances under which an identified exempt service would need to use a vehicle capable of carrying more than nine people
• current providers of services that are exempt from transport licensing requirements have not sought an increase in the size of vehicles used from nine to 12
• increasing the size of a vehicle may increase the risk to safety, given that a larger number of passengers may be carried on any one occasion
• if a vehicle is adapted to carry passengers in wheelchairs, allowing up to 12 seats would result in the use of a fairly large, heavy vehicle
• there would be less incentive for providers to operate an illegal unlicensed service capable of carrying more people under the pretext of being an exempt service.

Your comments, including any arguments that have not been put forward in this overview, for the appropriate size of vehicles used in operating exempt passenger services are welcome.

Issue 5            Exempting organisations offering food and beverages for consumption on premises

For some years now, some pubs and clubs (such as chartered clubs, RSAs and sports clubs) that offer liquor, meals and refreshments on their premises have been providing transport to take their clients and members home. Provided that the passengers are not required to pay a fare, the service does not have to be licensed.

Some clubs want to be allowed to recover their operating costs by ‘requiring’ a gold coin ‘donation’ from passengers. It has been argued that because this service ensures that drinking patrons do not drink and drive, these organisations play an important road safety role.

It is proposed that the draft Rule should allow these organisations to be exempt from passenger service licensing and thereby enable them to recover their operating costs in this way. This would apply only to carriage using small passenger service vehicles (with carrying capacity of not more than 12 persons).

Your comment is sought on this issue.

Issue 6            Carpooling activities promoted under Rideshare initiatives

The Transport Services Licensing Act requires the carriage of passengers for hire or reward by means of a motor vehicle to be licensed. Although the term ‘hire or reward’ is not defined, recent amendments made to the Land Transport Act further clarify what this involves, including when this involves a specific charge on passengers for transport, including part payments to cover fuel and donations (which are expected as a condition of carriage).

The draft Rule (Proposal 37) proposes to exempt carpooling activities for the purposes of work/business, tertiary education and sports. It has been suggested that the proposed exemption be widened to include other carpooling activities to increase transport access and mobility for more people. This proposal would support the Rideshare initiatives promoted by the Energy Efficiency and Conservation Authority, which aim to link together people with similar travel patterns to reduce costs, congestion, air pollution and stress.

Comment is sought as to whether the carriage of passengers involved in these initiatives should be exempt from licensing, when genuine cost-sharing arrangements are adopted.

In considering this issue, it is important to note that there is a trade-off between safety and security and access and mobility.

 

Matters to be taken into account

The Act provides the legal framework for making Land Transport Rules. Section 161 of the Act states the procedures by which the Minister of Transport makes 'ordinary rules'. These include the obligation to consult, which has been developed into a series of formal and informal discussions procedures.

Section 164 of the Act states the matters to be taken into account in making Rules. In making ordinary rules, the Minister is required to give such weight as he or she considers appropriate in each case to the matters discussed below. The Land Transport Amendment Act 2004 amended the matters that the Minister must take into account when making Rules, to reflect the overarching importance for transport of the NZTS. The NZTS envisages that, by 2010, New Zealand will have an affordable, integrated, safe, responsive and sustainable transport system.

Application of Rule-making criteria

Proposed activity or service

Section 164(2)(b) of the Act requires that appropriate weight be given to the nature of the proposed activity or service for which the Rule is being established. The ‘proposed activity or service’ that is covered by the draft Rule is establishing a clear framework for the licensing of transport service providers.

Risk to safety and personal security

Section 164(2)(a), (c) and (d) requires the Minister to take into account, respectively, the level of risk to land transport safety in each proposed activity or service; the level of risk existing to land transport safety in general in New Zealand; and the need to maintain and promote land transport safety and security, including personal security.

The draft Rule addresses the risk to land transport safety arising from the operation of transport services. Transport services use public roads and pose road safety risks to their drivers, other road users and passengers (in the case of passenger services). The highly competitive nature of commercial operations and business pressures means that safety concerns may be compromised if there are no safety requirements in law, with effective enforcement measures. There is a need to prescribe consistent safety standards for all operators to ensure they know what is expected of them.

Several proposed requirements in the draft Rule are expected to assist in improving safety. These relate to the new powers of the Director to require a licence holder to re-sit the examination for a CKLP, when the holder does not have an adequate knowledge of the laws and practices pertaining to the safe and proper operation of the transport service or is re-entering the system after having completed the period of their disqualification (from holding or obtaining a transport service licence). This would ensure operators were knowledgeable of their legal obligations in operating a safe service.

The new requirements for ‘dial-a-driver’ drivers to wear a photo ID card, and taxis to display vital identification information in Braille, are expected to enhance personal security for users of ‘dial-a-driver’ services and visually-impaired passengers travelling in taxis. Strengthening the requirements of ATOs in respect of reporting serious driver complaints and termination of ATO membership resulting from serious misbehaviour would enable swift and appropriate action to be taken against drivers who pose a safety risk. The draft Rule also clarifies some existing requirements, which would improve compliance with safety requirements and enforcement.

Assisting achievement of strategic objectives

Section 164(2)(e) of the Act requires the Minister to take into account whether the proposed Rule: (i) assists economic development; (ii) improves access and mobility (iii) protects and promotes public health; (iv) ensures environmental sustainability.

The proposals in the Rule to continue to exempt some transport services (such as those operated by district health boards and registered charitable organisations, and some carpooling activities) from the requirements to be licensed are expected to have a positive impact on access and mobility. The proposal to widen the exempt carpooling arrangements to include travel to and from a tertiary institution and sports activities is expected to improve access and mobility for those who choose this means of transportation. Similarly, re-instating the previous exemption for transport relating to school-related activities will improve access and mobility.

Costs of proposed changes

Section 164(2)(ea) of the Act requires that appropriate weight be given to the costs of implementing the measures for which the Rule is being proposed.

The majority of the provisions in the draft Rule do not impose additional compliance costs on transport service operators and drivers, because the requirements are rolled-over from existing legislation. A small number of proposals would result in cost savings. These relate to:

• removing the public notification requirement for applicants for a passenger service licence and a vehicle recovery service licence
• exempting applicants for a rental service licence from holding a CKLP
• removing the need for operators of shuttle and private hire services to apply to the Director for exemptions from rules that apply specifically to taxi services
• simplifying the operating rules for rental service operators.

Significant cost impacts are expected from four new requirements in the draft Rule, namely, taxis must display vital information in Braille; taxi drivers in metropolitan centres must hold an AKC for the entire centre; transport service vehicles would be required to display their TSL number and ‘dial-a-driver’ drivers must hold and wear a driver ID card.

Several new requirements, particularly those relating to ATOs, would have cost impacts. Because Land Transport NZ does not have full information about the costs involved, comments are sought on the additional costs that these proposed changes would have on operators and drivers.

International considerations

Sections 164(1) and 164(2)(f) of the Act, respectively, require that Rules may not be inconsistent with New Zealand’s international obligations concerning land transport safety, and that international circumstances in respect of land transport safety be taken into account in making a Rule. Although New Zealand does not have any international obligation in this area, in developing this draft Rule, consideration has been given to safety requirements in safety-conscious jurisdictions overseas.

 

How the draft Rule fits with other legislation

Relationship of proposed Rule to Land Transport Amendment Act 2005

The amendment Act, which was passed into law in June 2005, incorporated operator licensing provisions in the Transport Services Licensing Act and Transport Services Licensing Regulations into the Land Transport Act, and expanded the Rule-making powers of the Minister to cover requirements not incorporated into the amendment Act and proposed new changes.

This was intended, in part, to simplify licensing requirements, improve commercial operator and driver standards, improve accountability of ATOs and strengthen offences and penalties. The amendment Act contains provisions relating to operator licensing that are considered to be ‘high level’ in nature. It sets out:

• the types of transport service that must be licensed
• the need for taxi operations to be licensed and the criteria for granting and revoking approvals
• the fit-and-proper person criteria for determining a licence applicant’s suitability for entry into, or exit from, the system (including those for an approved taxi organisation)
• the powers and procedures involved in granting, revoking and suspending a TSL or in disqualifying a licence holder
• the primary responsibilities of transport service operators in respect of the vehicles that they operate
• related offences and penalties.

Provisions in Part 1 of the Transport Services Licensing Act (and in the Transport Services Licensing Regulations) relating to transport service licensing that are not included in the amendment Act and that are to be retained are ‘rolled-over’ into the draft Rule. When the Rule comes into force, these provisions will be revoked by Order in Council.

The parts of the amendment Act related to commercial transport services are not yet in effect. (See the table in the Appendix to this overview.)

Offences and penalties

The draft Rule does not contain offence provisions. These are to be contained in the Land Transport (Offences and Penalties) Regulations 1999, which will be amended to cover this Rule when it comes into force.

Review of fees

Policy changes to transport licensing have driven the requirement for Land Transport NZ to embark on a review of the costs and fees relating to its activities in this area. The review will take into account all the relevant factors, notably:

• cost increases since the last comprehensive review of transport licensing fees (in 1989)
• the impacts of recent changes to the principal licensing legislation and forthcoming Rules (including this one)
• the safety performance and compliance levels of commercial road transport operators (including the findings of the Controller and Auditor-General (2005) in relation to controls on the taxi industry, and in relation to his progress report (2005) on the implementation of recommendations of the parliamentary inquiry into truck crashes, and
• best practices in the delivery of monitoring and compliance functions to achieve the government’s transport objectives.

Any amendment to the fees regulations as a result of this review would be expected to come into effect at the same time as this Rule.

 

Publication and information

Copies of this document may be obtained by contacting the Land Transport NZ Help Desk on 0800 699 000. It is also available on the Land Transport NZ website at: www.landtransport.govt.nz/consultation/operator-licensing.

If you have not registered your interest to receive drafts of this proposed Rule (or other draft Rules in the Rules programme), you can do so by contacting Land Transport NZ at the address shown on the Making a submission page at the front of this publication, or on the Land Transport NZ website at www.landtransport.govt.nz/rules/reg-interest-rules.html.

Information about the Rules programme and process can be found on our website at www.landtransport.govt.nz/legislation/. An electronic form is also provided for registering an interest in Rules.

Final, published Land Transport Rules can be purchased from bookshops throughout New Zealand that sell legislation. Queries about the availability and price of Rules can be made to the Rule publishers, Wickliffe Ltd, on 0800 226 440.

Final Rules are also available on the Land Transport NZ website, together with related information.

 

Appendix

Land Transport Amendment Act 2005:

Order in Council items

Note: all of the matters relating to commercial transport services fall into this category.
Order in Council will follow signing of Work Time and Operator Licensing Rules

In Act	Description	Explanation
2	Interpretation	The clause results in repealing or changing more than 20 definitions, ie, goods service, goods service licence, transport service operator, etc. Note that: employees of an operator do not have to hold a Transport Service Licence (TSL) (clarification), but contractors do. Definition of goods service results in licensing carriage of goods by means of a motor vehicle whose gross laden weight is 6000 kg or more, while definition of passenger service results in licensing of ‘dial-a-driver’ services. The clause amends section 2 and s2(1) of the Land Transport Act 1998, for the TSL and ‘work time’ links. Other definitions not TSL-related are also included. Traction engines are included.
4	General requirements for participants in land transport system	Removes “the provisions of section 24 of the Transport Services Licensing Act 1989”. This is a legal reference issue, rather than a procedural/process/definitional change.
30A to 30X	New Part 4A: Transport Services Licensing	Commercial transport provisions from the TSLA are now inserted in the LTA. These include minor changes to the ‘Fit and Proper’ person test. (Mental illness removed as criteria). Also note: Can forbid copycat livery for approved taxi organisation (ATO). ATO control of drivers must relate to their operating rules, regulations, etc. S30AB Braille signs for taxis. S30P certificate (like Certificate of Knowledge of Law and Practice) (CKLP)) needed by persons in charge of ATO.
30Y to 30ZE	New Part 4B: Work Time and Log Books	Act states which commercial drivers are subject to hours and logbooks, and states core hours. Links to Work Time Rule for details. Note: core hours in Act, small goods vehicles subject to hours. Allows for alternative recording systems and Fatigue Management Schemes (FMSs). Operators must consult workers for FMS.
79A to 79M	Insert Part 6A: Offences relating to transport services and penalties	A series of clauses relating to offences etc, relating to transport services: links to s208 which specifies who may be an enforcement officer.
79N to 70S	Insert Part 6B: Offences relating to work time and log books	A series of clauses relating to offences relating to transport services: covers work time, records, discharging duties, log books, etc.
79T	New Part 6C: Chain of responsibility	Extends liability to persons who direct a driver to speed, exceed work-time hours, breach maximum vehicle gross weight limits, or fail to complete a logbook, or knowingly use an unlicensed transport service.
81	Provisions relating to mandatory disqualification	The addition of new words ‘or transport service licence’ widens the capture of the provision.
87A ff	Disqualification of commercial drivers	This relates to disqualification of transport driver and other persons; suspension of I (driving instructor) and O (testing officer) endorsements, the effect, procedure, term etc. Director can forbid driving in a specified service.
87B	Disqualification of holder of transport service licence from holding transport service licence	This relates to disqualification of a holder of a TSL or a person in control of a service, for a period not exceeding 10 years, following a licence revocation from holding or obtaining a TSL or having any form of control of a transport service.
96A	Impoundment of vehicle used in a transport service	The new clause relates to transport service vehicles (where used without TSL).
102	Appeal to Police against impoundment of vehicle	Widens and adds to the scope of impoundment capture to include transport service vehicles.
113	Enforcement officers may enforce transport legislation	Insertion of the new section (f) adds to the scope by forbidding a person to operate a transport service without the correct licence.
113A	New section 113A inserted: Power to inspect records	Widens the extent and power of an enforcement officer to require a person to produce for inspection a wide range of documents and records.
118	Owner or hirer to give information as to identity of driver or passenger	The words ‘licence holder’ is added and the provision widened to include the holder of a TSL, where the enforcement officer is attempting to obtain information from a person or persons.
119	Powers of entry	The inclusion of s96A increases the scope of impoundment to include a transport service vehicle
121	Enforcement officer may immobilise vehicle, etc, if driver incapable of proper control of vehicle	Broadens the scope of the section by adding the words ‘or work time’.
128A & B	Enforcement officer’s powers in respect of non-complying small PSVs and non-complying recovery service vehicle	Widens the capture of the enforcement officer’s powers in relation to prescribing small PSVs and recovery vehicles.
135	Offences punishable summarily	The amendment adds Part 6A, 6B, 6C and thereby captures the Transport Services in the ‘summary conviction’ net.
136	Time for instituting proceedings	Extends period in which ‘work time & log books’ charges may be laid.
145A	Evidence and proof	The insert clauses relate to evidence required and related under Part 6A, which is ‘transport services’ - related (s79a in the LTA).
159	Rules concerning land transport documents	Removes the reference to TSLA and replaces it with a new insert reference to determine a ‘fit and proper person’.
168	Regulations relating to fees and charges for land transport	Simply removes the reference to the TSLA.
199A	Register of transport services licences	The insert relates to the information and requirements of the transport services register. It sets out what must be held, what may be released, etc, and to whom.
208(3)	Appointment of enforcement officers	Covers the appointment of an enforcement officer in relation to transport services enforcement. Wider mandate than before (Rules explicitly included).
211A	Payment of fees	A new insert relating to fees payable in relation to transport services to go to the Authority.
TA 62	Interpretation	Section 2(1) of the Transport Act 1962 (Interpretation) is amended with new definitions; 2 – 6, and 8, 9.
	Sections 70B, 70C, and 70D in TA 62 repealed	These sections relate to driving hours and logbooks.
	Repeals, revocations, and consequential amendments	Most of TSLA revoked, including reference to rail services and to demerit points for transport service operators and drivers.
	Rights of existing transport service licence holders	Allows for existing licence holders to be granted an equivalent licence under this Act. Includes CKLP.
	Rights of existing approved taxi organisations	Allows for existing licence holders to be granted an equivalent licence under this Act.
	Transitional provision for holders of exemptions in respect of driving hours or logbooks	Exemptions or variations will cease to have effect 6 months after the date that the Work Time Rule comes into effect.

Last updated: 5 March 2007