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Protectionism Takes Colorado Transportation Entrepreneurs for a Ride

Abdallah Batayneh came to America from Jordan with the dream of building a better life for himself and his family. An entrepreneur at heart, he runs his own cleaning company while working full time at a picturesque hot spring in the Colorado mountainside. He loves the natural beauty, and he decided to start his own shuttle service to help visitors explore the region and support local businesses. 

Unfortunately for Abdallah, for years, insiders have lobbied states, including Colorado, to enact laws that block transportation entrepreneurs from starting new companies and competing on a level playing field. Here’s how it works: First, an entrepreneur has to ask for permission from the state’s Public Utilities Commission (PUC) before he or she can start a transportation company. Then the PUC tells existing companies that a newcomer is trying to operate in their territory. Of course, the existing companies object. They petition the PUC to rule that new competition isn’t “needed” and to deny the entrepreneur the opportunity to enter the market.

To learn more, watch the case video.

That’s exactly what happened to Abdallah when he tried to start his shuttle service. The local transportation cartel intervened in his application, claiming that his company wasn’t “required” and complaining that some customers might choose Abdallah’s shuttle over their own. The PUC admitted that Abdallah was “operationally, managerially, and financially fit to operate” and that customers weren’t satisfied with the existing shuttles’ service or rates—and then sided with the insiders anyway, denying Abdallah his right to open a business and compete. 

The transportation industry is rife with government-protected monopolies like this, and IJ has been fighting transportation cartels for more than 25 years. In one of our earliest cases, we sued to free taxi entrepreneurs to compete in Denver. It was an uphill battle: No one else was bringing these cases, ride-sharing services didn’t exist, and precedent was stacked against us. But we prevailed. In response to IJ’s lawsuit, the legislature changed the law and let the city’s taxis compete. 

Now we are back in Colorado to finish what we started years ago, with a track record of dozens of victories against this kind of protectionism behind us, including 12 for transportation entrepreneurs. We have proved that competition works in Denver, and new technologies have greatly reduced barriers in the transportation industry. When the government still insists on blocking Abdallah and others like him from working, IJ will be there.

William Aronin is an IJ attorney.

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