New businesses need fine-tuned policy to flourish

Getting the regulation for car pooling ventures right will make sure entrepreneurship is not choked off

Businesses such as Carpool Arabia currently exist in something of a legal limbo, with questions over their recognition by authorities. Silvia Razgova / The National

Musicians used to complain about the rise of the internet and how it was killing legal music sales. Many still do. And yet many more, especially those acts that are not yet established, discover that the internet allows them many more avenues to reach fans, collaborate with other musicians, play innovative gigs and, in the end, make money.

The internet is a highly “disruptive” technology. In the last twenty years, it has revolutionised so many traditional fields - music, film, shopping, connecting with friends and family - and continues to disrupt many more. It is into this category that carpooling websites - such as Carpool Arabia, a private website that allows users to ride-share - fall. They, as well as other car-booking apps like Uber or Careem, which let ordinary people pick up passengers, are disrupting traditional ways of doing business.

It is here that the Government and the municipalities of the emirates need to tread a careful line. Legislation is vital when it comes to public safety - but these new companies are offering homegrown solutions to legitimate problems. Getting the balance right between not over-regulating simple interactions made possible by new technology - such as arranging to carpool, which used to be done by word of mouth and is done by social networking - and making sure people are not opening themselves to risk - by getting into cars that don’t have the correct insurance or with risky drivers - will require delicate and careful policy.

In the end, policy must be proportionate. It should not penalise the majority of people to regulate a law-breaking minority. Take car-sharing. There is a world of difference between, say, three colleagues carpooling with a fourth stranger who works in the same building and someone seeking to make money on the side by driving three people to work. Any regulation has to draw that distinction.

The same applies to businesses that seek to make a profit, like Careem or Carpool Arabia. They currently exist in something of a legal limbo, with questions over their recognition by authorities. But both are homegrown businesses, started in Dubai, and both aim to solve a problem that the authorities themselves are grappling with. Far better for the authorities to work with these companies to close the regulatory gaps, so that new businesses can flourish. In time, they may, like online music, create services that benefit everyone.