HB 429: Rental Car Protectionism

This bill was stranded in the House Rules Committee.

The sharing economy utilizes technology to empower individuals to connect with one another directly in commerce—whether with food, lodging, payments, transportation, and more.

Turo is a new company enabling people to rent their vehicles to others through its app. The company works with insurance companies to ensure that liability is sufficient covered and that individuals can safely transact in this way. In short, the model is working, and generally legal.

But a new bill in Utah could present a problem. Sponsored by Representative Dan McCay, House Bill 429 creates a whole host of unnecessary regulations that restrict the activities of Turo and its competitors, bringing it under a bureaucratic regime that has no justification; no problem exists requiring such a heavy-handed approach.

What is more likely is that existing rental companies—in other words, incumbent providers that see this sharing method as a threat, just as taxis are threatened by Uber—are seeking such legislation in order to increase the difficulty of eating away at their market share.

Individuals should be free to share their homes through Airbnb/VRBO, or their trips through Uber/Lyft, or their food through Slapup, or their vehicles through Turo. Government regulation is only justified when necessary to legitimately protect public health or safety—not to shield businesses from upstart competition.

The more regulations added on now, the more difficult it will be for future companies to enter the marketplace, potentially resulting in less affordable options for consumers.