New draft rules to regulate bike-sharing industry

Beijing authorities on April 21 issued a drafted citywide rule to regulate the unfettered bike-sharing industry, making the city the fifth Chinese metropolis to lay out concrete requirements in the area, following Shenzhen, Chengdu, Shanghai and Nanjing.

Below is a list of major areas addressed by the regulation.

Focus 1: Deposit Management

Most bike-sharing companies in China may charge a deposit to initiate service, and the supervision of the fund remains a hot topic. Numerous cities plan to introduce third-party supervision.

In the newly issued trial document, Beijing requires bike-sharing startups to open special accounts in the city for the deposits they've charged.

The operations office of the People's Bank of China shall take the supervision and management responsibilities for these special accounts so as to prevent and control capital risks.

The companies are obliged to keep the public informed of their time limit for refund and return deposits to users in time.

All refunds should be returned before a firm exits from the bike-sharing market. A public notification is also demanded.

Mobike and ofo, two leading Chinese bike-sharing companies, have responded to the official regulation, expressing a supportive attitude to the rules, in addition to promising to ensure the security of their customers' capital.

Shenzhen, capital of southeast China's Guangdong province, and Shanghai, the largest bike-sharing city in the world – a title claimed by local government last December, have previously announced third-party supervision policies. The latter also requires usage reports of the money and at the same time stipulates that deposits shall be returned within seven days upon request.

Focus 2: Client Security

Along with the spectacularly multiplied fleet of shared bikes have come not only more convenience for commuters but also increasing related traffic accidents, especially those involving children under 12.

Under security considerations, Beijing authorities are placing an emphasis on strengthening insurance claims mechanism for customers and quality inspection for shared bicycles in service.

The draft document is also recommending and encouraging companies to purchase personal accident insurance and third party liability insurance for their clients.

Active assistance should also be provided by enterprises when their users require insurance claims.

Bicycles should be put into use according to relevant legal and technical requirements, equipped with GPS systems.

Bikes in service need to be tested regularly, and those unqualified must be removed in time to ensure safety.

When accidents occur, the division of responsibility should be in compliance with the assertion identified by transport authorities. Users who break relevant regulations will face both credit loss and administrative penalties.

In Chengdu, capital of southwest China's Sichuan province, city officials are also urging insurance purchases and have set up a certain sum of compensation.

Shenzhen and Nanjing, capital of east China's Jiangsu province, clearly demand insurance purchases. The latter has also required the submission of quality examination reports of the shared bikes to local authorities.

According to rules published by Shanghai authorities, shared bikes in service must keep a serviceability rate of 95%, and broken bicycles must be removed within 48 hours. A maintenance crew must be provided, capable of servicing no less than 5% of the total number of bikes in service.

Focus 3: Parking Management

The "stationless" shared-bikes in Chinese metropolitan cities have caused troubles like traffic jams, confusion in parking and vandalism, which constitute the most critical part of the program.

Beijing recommends that bike-sharing companies make use of electronic maps to mark parking and no-parking areas. Users guilty of illegal parking have risk of being blacklisted.

Shenzhen and Nanjing have also promulgated measures to ask users to park properly, thus preventing large numbers of bikes from disturbing others.