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Friday, May 09, 2025

Spain to Regulate Pricing Algorithms for Ride-Hailing Apps

Spain to Regulate Pricing Algorithms for Ride-Hailing Apps

New legislation aims to increase transparency in pricing models used by companies like Uber and Cabify.
The Spanish Ministry of Social Rights, Consumption, and the 2030 Agenda has announced forthcoming regulations on the algorithms employed by companies such as Uber and Cabify to set prices and personalize advertisements.

Under the guidance of Minister Pablo Bustinduy, the initiative is designed to ensure transparency and accessibility in the parameters that inform these algorithms for consumers.

The newly proposed regulations will prohibit discriminatory pricing and prevent companies from exploiting situations of urgency or necessity when determining fares.

In November, following severe weather events in Valencia, the Ministry had already amended consumer laws to prevent apps from increasing prices during periods of high demand due to emergencies.

This latest initiative will also enforce a ban on automatic price modifications during the purchasing process itself, thereby aiming to alleviate consumer pressure to make hasty decisions in response to fluctuating prices.

According to the Ministry, the goal of this proposal—still pending execution details—is to enhance consumer awareness regarding data usage and bolster privacy controls.

At a recent event discussing consumer rights in the digital realm, Minister Bustinduy highlighted the importance of providing consumers with clear information on how prices are established.

For Uber and Cabify users, this means that these companies will need to clearly disclose the factors that contribute to pricing, such as the distance to the destination, the time of travel, the frequency of similar trips, or any significant events impacting the city’s transportation dynamics.

Additionally, the regulations will explicitly prohibit setting prices based on discriminatory factors, such as race or disability.

Minister Bustinduy stated, "No business model can be sustained through the violation of rights," and emphasized the necessity for democratizing economic relationships to foster fair, transparent exchanges under equal conditions.
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