ALL THINGS LICENSING
section 62 which allows action against a licence in the event of non-com- pliance with the require- ments of the 1976 Act (such as conditions relating to honouring bookings) for ‘any other reasonable cause’.
What does the judgment mean for Licensing?
Certainly many licensing authorities have been keeping an eye on the judgment as had there been a requirement to have a contact in place between operator and passenger / operator and driver then it is likely that there would have been significant arbitration required by the local authority between all parties in the event of a dispute, such as a vehicle not arriving for a booking or a driver not being paid for a job.
There has been some concern that the lack of a contract required will mean less protections for passengers and how might this be resolved.
We need to remember that the 1976 Act was introduced to regulate the private hire service for reasons of public protection, and these principles still apply. Section 55(1)(a) obliges the council to ensure that the operator is a ‘fit and proper person’ and s.55(3) allows necessary conditions to be attached to a licence.
We also need to remember that section 56, as set out in the judgement above, means that whatever the contracting model used, the hirer’s contract will be deemed to be with the operator who accepted the booking providing a degree of implied protection.
Many authorities already condition operator licences to the effect that when a booking is made that a vehicle should arrive at the appointed time and place as obliged and therefore these requirements have been providing passengers with protections for some time.
Operators who do not fulfil bookings are firstly, likely to get an adverse reputation which may impact future business, but also may be subject to licensing sanctions. It’s arguable that an operator who continually lets passengers down cannot be considered to be ‘fit and proper’ and will likely have a licence suspended or revoked under the provisions of
62 What happens now about VAT?
The position now outside London is that whatever model operators use will not need to change and I am sure the VAT implications will be explored in this edition of PHTM by others who are far more knowledgeable on taxation than I. (See pages 6-7)
What happens going forward is likely to be of interest as HMRC last year consulted on the VAT treatment of private hire vehicles, and now that this judgement has been settled definitively, it is entirely conceivable that we will see the results of this consultation with some further direction.
To conclude
It will be really interesting to see how this judgement plays out with a distinct difference in contractual requirements and VAT between London based operators and those governed by the 1976 Act.
However, for those licensing authorities and operators involved with the regime, we can carry on as we are, knowing that there are existing legislative provisions which allow some protections for passengers.
An important reminder!
Finally, if you have not already done so, it is VITAL that you respond to the current inquiry into the Licensing of Taxi and Private Hire Vehicles. Details were discussed in August’s edition with the consultation online accepting submissions until the 8 September:
https://shorturl.at/FD4a4
The Institute of Licensing also has an upcoming Taxi Conference taking place online on 21 October, where these topical issues will be discussed in detail and members of the trade will be provided with a unique insight, so keep in the know and come along.
For full details please visit:
www.instituteoflicensing.org.
SEPTEMBER 2025 PHTM
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