There are two types of taxi: hackney carriages and private hire vehicles. Generally, hackney carriages can be hailed in the street or operate from taxi ranks whilst private hire vehicles can only operate on a pre-booked basis. The council sets fares charged by hackney carriages, whilst private hire vehicles operate on the basis that the fare is agreed between the driver and the customer. Vehicles to be used for public or private hire purposes must be licensed by the local authority and can only be driven by licensed hackney carriage or private hire drivers. A private hire business must have an operator licence.