Hong Kong’s cap of 10,000 vehicle permits for ride-hailing services is a “prudent and safe starting point” and the government will dynamically adjust the quota based on operational data, the city’s transport minister has said. The quota, revealed on Tuesday, prompted lawmakers to call for frequent reviews in the initial months after the scheme’s launch and swift government intervention if services proved insufficient. Speaking to the media on Wednesday, Secretary for Transport and Logistics Mable Chan stopped short of setting a specific time frame for reviewing the quota despite criticism from Uber that the number of permits was too low. She reiterated that authorities would monitor the situation closely and make adjustments based on data from licensed platforms, such as the number of orders dispatched and cancelled, the number of hours drivers were active online and the number of completed rides. “As a start, we would like to take a prudent, careful approach to ensure that our proposed regulatory regime will be achieved and implemented in a safe, smooth and progressive manner,” Chan said. “I believe that our mechanism and our review should be based on data and should take into account the various operating indicators.” She expected the first batch of ride-hailing drivers with permits to start operations by the end of November or early December. In a paper submitted to the Legislative Council on Tuesday, the Transport and Logistics Bureau said that based on an average of six hours of operation and 12 trips per vehicle per day, a 10,000-vehicle fleet would provide an estimated 120,000 daily trips, broadly in line with a previously surveyed demand of 114,000 trips. Most legal provisions regulating ride-hailing services are set to take effect on August 3, while the remaining regulations covering vehicles and drivers are slated to come into force on August 22 next year, according to authorities. Chan also dismissed concerns that the 10,000 limit favoured the taxi industry, which had appealed for a cap of between 1,500 and 3,000 permits – a fraction of Uber’s proposed quota of 30,000. She stressed that passenger demand and the provision of safe, efficient services were the government’s primary considerations. The minister pledged to continuously improve and diversify ride-hailing services and adjust the regime in accordance with the city’s needs. Lawmaker Mark Chong Ho-fung, a member of Legco’s transport panel, urged the government to review the quota within the first month of launch and raise it if services failed to meet demand. “The government should prepare an additional 5,000 to 8,000 quota, and issue them immediately if needed,” he said, saying passengers might find it difficult to book a ride under the current quota. He proposed a review every six months or annually once the scheme was running smoothly. Chong also called for a minimum requirement of 40 work hours per month to prevent licences from becoming dormant and for underused permits to be revoked. He said the 10,000 quota was a conservative starting point but that he understood the government’s aim was to avoid having to reduce the number later. “If it is later discovered that the market does not need so many licences and the quota is reduced … it could create a significant backlash,” Chong said. “Those who entered the industry would have already bought insurance, obtained licences, bought cars and rented parking spaces.” Lawmaker Ben Chan Han-pan, chairman of the transport panel, also called for more frequent reviews in the early months of the scheme. “We need to monitor drivers’ online hours and patterns, the price gap between ride-hailing services and taxis, how long passengers have to wait and how many end up unable to get a ride,” he said. “If the quota turns out to be far too low, the government should step in immediately.” Chan added that it was understandable for the government to adopt a more cautious approach when rolling out a new regime. “There are many unknowns when the new regime is introduced,” he noted. “It is normal for the government to adopt a safe approach … but it has also left room for flexibility through dynamic monitoring and adjustment.” Responding to questions from the South China Morning Post, Singapore-based Tada described the 10,000 cap on permits as a positive step towards a well-regulated and sustainable industry. “We believe it will be important for licence allocation to continue evolving alongside market demand to ensure riders have access to reliable and convenient transport options when they need them,” a company spokesman said. He added that Tada would continue to work with the government and industry stakeholders to build a supportive and sustainable transport ecosystem in Hong Kong. Uber said on Tuesday that the initial quota was “significantly lower” than required to meet demand from residents and tourists. The company, based in the United States, has operated in a regulatory vacuum in Hong Kong for more than a decade, during which time competitors such as Tada and mainland Chinese operators Didi Chuxing and Amap entered the market. Amap is operated by Alibaba Group Holding, the owner of the South China Morning Post. The SCMP has reached out to Didi Chuxing and Amap for comment.