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Update: China's Ministry of Transport Issues New Draft of Online Car Rental Regulations

Ministry of Transport, 8/08/17

China's Ministry of Transport and Ministry of Housing and Urban-Rural Development have jointly issued updates to a draft regulation regarding the development of the online and mobile car rental industry.

The update adds to the scope of the regulation, adding statements on the "protection of public safety with increased requirements on collection and reporting of information" and "encouragement of alternative energy vehicles in timeshare leasing" to the original guidance on small passenger car rentals.

The guidance document proposes that "small passenger car rental" refers to any situation in which a car is rented for an agreed upon time from an operator by a lessee who pays a rental fee which is collected by the operator. This definition does not include the provision of driving services, such as chauffeur services, as a part of small passenger car rental.

The document also proposes regulations for small passenger car rental operators that address vehicle registration, the implementation of vehicle safety inspections and scrap management, and the encouragement of insurance companies to develop additional insurance products. The document also requires the implementation of a background check system and strengthening of daily operations management; encourages the adoption of GPS devices, geographic information systems, connected cars, and "electronic fence" technologies; strengthens control of rental car safety standards; and encourages the use of online platforms and apps by leasing operators to develop services such as vehicle booking, car pick-up, and electronic payment.

The document further encourages the development of time-sharing rental services, and points out that time-sharing rental, commonly referred to as car sharing, is defined as a service that uses minutes or hours as a pricing unit, and utilizes the Internet, global positioning, and other information technology to build a network service platform that provides users with self-service car booking, car pick-up and return, and cost calculation and settlement.

Finally, the document encourages the development of public parking lots in crowded areas such as city commercial centers, government centers, large residential areas, and transportation hubs, in order to better facilitate parking for shared cars.

The updated document does not specify when the regulations will be implemented.

Editor's Note: For more information on this topic, please see "China Issues Offline and Online Car Rental Regulations," MD 6/01/17 issue.

Keywords: vehicle rental app wireless Internet Ministry of Transport regulation MOHURD automobile

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