The Allocation Of Compensation Liability When Passengers Injured In Online Special Car Service

Congestion is probably one of the most representative features of city life. Along with the rapidly increasing urbanization, the proportion for citizens turning to public transport system, instead of foot or bicycle, have started getting majority. Comparing to crowded buses and expensive private cars with high maintenance, taxi service, as a crucial component of public transportation, enjoys popularity among citizens. Notifications and regulations have been carried out by Ministry of Transport in recent years to implement reforms in taxi industry and try to guide it into the trend of knowledge economy, including encouraging call service, improving mobile app platforms, etc. Traditional taxi industry has been challenged by companies like Didi Dache and Uber. These companies, created based on “the Internet of things”, develop market and operate mobile apps, which allow consumers with smartphones to submit a trip request which is then routed to private drivers who use their own cars. The business model had soon spread due to the strong market needs and been supported by private finance with an intent to get a portion of cake from traditional taxi companies.The legality of these non-traditional online special car products has been challenged by governments and taxi companies(for which taxi franchise is required), who allege that its use of drivers who are not licensed to drive taxicabs is unsafe and 2illegal. According to news reports, drivers who work for online private car platforms had been more or less under local government’s examination in Shanghai and Nanjing, some even determined as “illegal cab operations”. Although prohibitive provisions had been designed to regulate the increasingly complex taxi industry, motivated by enormous economic profits, these newly emerged companies payed effort digging out paths to avoid investigation. Cooperative agreements with car rental companies and labor dispatching agencies had been reached, which provides margin to maneuver. Many private drivers start working for online special car platforms, though they know it is the juristic risk on illegal business operation they are facing. Meanwhile increasing number of consumers are willing to pay for these Internet private taxis. Either governmental ban or permission is an unnatural intervention into personal decisions, suggested Hayek in his theory of spontaneous order. He viewed the free market system not as a conscious invention that which is intentionally designed by, for example, government, but as spontaneous order or what he referred to as “that which is the result of human action but not of human design”. It’s the same with the new-born online special car service, for which the biggest obstacle is not governmental regulation but the increasing risk of passengers’ safety. Legislation and judicial practices failed to guarantee passengers’ security due to its lack of safeguard measures. Internet is a special background and gives online car service soil and water to make it thrive. Now that this service has gained popularity and disguised with legality, the focus of this paper would be feasible precautionary approaches against risks on passengers’ safety, instead of administrative analyses of the legality of online special car operation. On the bases of Tort Liability Law and Contract Law, legal relationships among all participants will be analyzed in this thesis, and compensational responsibility allocation in cases, as the passenger injured in an online special car service by him/herself, the driver/server or a third party, discussed.The study for the thesis includes: 1. introduction of the two services-traditional taxi and online special car service; 2. the differences between two operation models; 3. comparison and analyses of legal relationships and entities in the models. Firstly, comparisons between two operation models is discussed, after a general introduction of online special car service model and the market and legal environment facing it. Secondly, jurisprudence knowledge is used to analyze the effects on each entities in cases where the passenger got injured in online special car services. Responsibility allocation on compensations is, then, decided according to relevant laws and regulations. Next, detailed situations where responsible entities are supposed to compensate is analyzed. A study of the insurance system in online special car service is, meanwhile, incorporated in search for measures to decrease risks concerning future development of the online special car service. In the end of the thesis, a conclusion is given together with the shortcomings of the study. Only with a clear responsibility allocation in cases where compensation towards an injured passenger is needed, can the online special car service be completely legalized and the consumers’ welfare protected.