Liberalization and Deregulation of Taxi Market in Warsaw, Poland

Abstract

Warsaw, the capital city of Poland with over 1.7 million of officially registered inhabitants and up to further 8 hundred thousand unregistered inhabitants (registered elsewhere in Poland) is the largest taxi cab market in the country with about 9 thousand officially registered cabs in 2013 gathered in almost 40 taxi corporations, and with unknown number of unregistered vehicles owned by person making attempts to circumvent regulation imposed on taxi businesses. Warsaw taxi market plays absolutely predominant role in any discussion on the regulation or liberalization of operation of taxi cab businesses at the level of central government. The regulation of operation of taxi cab businesses in Poland has traditionally been very centralized and decided at the country level by the national legislator (statutes of parliament and secondary legislation of the competent ministries) leaving not much discretion for local laws adopted by local councils of the municipalities. On the other hand, Warsaw’s cab drivers’ organizations and Warsaw’s magistrate are the most prominent lobbies at the central level compared with other country’s cities. For this reason the regulation of and the policy on the taxi market in Warsaw needs to be analysed along with country-wide laws and country-wide discussion on liberalization of this market. A complex country-wide system of cabs’ licensing, licenses quotas, drivers’ examination focused on topography of the city (in which taxi cabs operate) and the preclusion of with criminal record from the taxi business was mandatory for all municipalities in Poland. Local councils were only free to regulate maximum prices for taxi services. Municipalities have never had a right to interfere with things like choice of vehicles’ models or brands, their environmental performance, even their body colour etc. which can often be found elsewhere in largest cities all over the world. The country-wide system has been gradually liberalized since April 2011 when the licence quotas were eliminated. Meanwhile, however, the national legislator put a lot of effort to effectively curb the phenomenon of unlicensed entrepreneurs offering carriage of persons (imitating licensed taxis -- especially popular thing in Warsaw) following the logics that if a number of licenses is not further limited, no circumvention of laws is to be further tolerated. A new wave of general liberalization of dozens of profession Poland initiated in 2012 was about to further liberalise the taxi market in Poland. Exams for prospective cab drivers covering topography of the cities were about to be eliminated all over the country which made perfect sense in the era of GPS and of technological achievements of the present. This would leave cab licensing system all over Poland as a pure formality confined to checking criminal record of entrepreneurs and the drivers and to entry medical examination of the drivers as well as entry technical inspection of vehicles. Nevertheless, the strong resistance by the President of Warsaw left 39 largest in Poland with a right to decide whether to still examine prospective cab drivers or not. As for mid 2013 this was regarded as the greatest defeat of the reform on the deregulation of profession in Poland and the evidence of Warsaw’s cab drivers’ lobby strength. Nevertheless the overall image of reforms made between 2010 and 2013 is very positive. The deregulation with regard to taxi business enters into force on 1st January 2014 and it is unpredictable whether the Warsaw’s local council within its new power to conduct or not cab driver’s examination will elect not to have cab drivers’ examination and therefore make the last step in full liberalization of taxi market in Warsaw.