Why Hasn’t Japan Lifted the Ban on Ridesharing?

Why Hasn't Japan Lifted the Ban on Ridesharing? Car

Ridesharing services, epitomized by companies like Uber, have seen widespread adoption in many countries and regions around the world. However, in Japan, these services remain prohibited due to their classification as “white taxi” (unlicensed taxi) operations. Despite this, there seems to be a resurgence in discussions about potentially lifting this ban. Let’s delve into the reasons behind Japan’s prohibition of ridesharing and the prospects for its future legalization.

Background of the Ridesharing Ban in Japan

Ridesharing is a service that connects passengers with drivers via a smartphone app, allowing them to share rides. The concept is a win-win for both parties: passengers get a convenient mode of transportation, and drivers earn money for their services. Uber, a pioneer in this space, gained immense popularity in countries like the US due to its user-friendly app and the opportunity it provided for drivers to earn money as gig workers.

However, as ridesharing grew in scale, it began to be perceived more as a competitor to traditional taxis than a mere sharing service. This led to friction between taxi operators and ridesharing companies worldwide, with some countries even moving to ban ridesharing services. Japan was no exception. The country’s Road Transport Act prohibits unlicensed individuals from transporting others for profit, classifying such activities as “white taxi” operations. To legally offer ridesharing services in Japan, a change in the law would be necessary.

However, the high quality of taxi services in Japan, coupled with the taxi industry’s strong opposition to ridesharing and some missteps by ridesharing companies, meant that the momentum for legalizing ridesharing never really picked up. As a result, ridesharing companies like Uber and DiDi have had to pivot to offering taxi dispatch services in Japan.

The Current Dilemma

Despite the challenges, the question arises: why is the debate on legalizing ridesharing resurfacing now? The answer lies with the taxi industry itself. The COVID-19 pandemic significantly reduced the demand for taxis. However, as the situation improves and travel resumes, there’s a growing demand for transportation services, especially with the increase in foreign tourists. Yet, the taxi industry is grappling with a shortage of drivers, exacerbated by Japan’s aging population. This mismatch between demand and supply has raised concerns about illegal ridesharing operations targeting foreign tourists.

Given the inability of the taxi industry to meet the rising demand, the only viable solution to address the transportation needs without promoting illegal activities seems to be the legalization of ridesharing. This sentiment is further supported by reports suggesting that the Japanese government is showing interest in revisiting the ridesharing ban.


While the path to legalizing ridesharing in Japan is fraught with challenges, including ensuring safety and addressing concerns related to gig workers, the clear inability of the taxi industry to meet growing demand makes the discussion inevitable. As Japan continues to prioritize its tourism policies, it might be time to reconsider the stance on ridesharing.