DhakaTribune
Monday December 11, 2017 01:09 PM

The Uber headache for regulators, taxi services

  • Published at 01:52 AM August 11, 2017
  • Last updated at 05:18 PM August 14, 2017
The Uber headache for regulators, taxi services
There is no legal barrier to operating apps like Uber in Bangladesh, but there is the issue of using private vehicles for commercial purposes – it is not yet allowed in the country Rajib Dhar/Dhaka Tribune

Ride-sharing companies and vehicles will be enlisted by BRTA and charged Tk1 lakh for a year

The government is yet to establish a proper regulatory framework for Uber even though the global ride-sharing service operates in 66 countries around the world and launched its operation in Dhaka in November last year.

Secretary of Road Transport and Highways MAN Siddique told the Dhaka Tribune that a draft ‘ride-sharing service guideline’ will be finished this month and then sent over to the Cabinet Division for final approval.

The Bangladesh Road Transport Authority (BRTA) has already completed a public consultation on the draft, which states that ride-sharing companies and vehicles will be enlisted by BRTA and charged Tk1 lakh for a year.

The draft also says the ride-sharing companies should have a provision for being able to connect to law enforcement agencies through the app to improve safety issues for the passengers.

“We want a good mode of public transportation for the people, and not just another revenue stream,” MAN Siddique said.

However, details such as how the government will earn revenue, whether the BRTA will fix fares, and the maximum number of cars which can be operated under a single company are all absent from the draft.

Mainuddin Ahmed Upel, a banker who uses Uber regularly, said: “I am still happy about the Uber fares, even after the company raised it, but the BRTA will eventually fix it.”

The draft guideline also suggests including taxis and auto-rickshaws alongside private vehicles, in response to concerns from existing transport owners that their businesses will be hit.

Dhaka Metropolitan CNG Owners Association President Barkatullah Bulu told the Dhaka Tribune that the CNG operators had already been hurt by Uber’s arrival in the capital.

“We have petitioned the BRTA so that they are not allowed to run their business until the authorities pass a policy to regulate them,” he said.

He also revealed that Uber had approached the association asking them if their services could be integrated with each other.

“We told them that there are 12,715 CNG auto-rickshaws operating in Dhaka and about 20,000 drivers. Most of them are illiterate and cannot operate their app,” Bulu said. “Uber said that they would train the drivers on how to use the app.”

Asked about such initiatives, Uber spokespersons declined to comment.

Taxi drivers cry foul

Similar issues emerged when Uber began its operations in other cities across the world. Last year in Kuala Lumpur in Malaysia, local taxi drivers held demonstrations after claiming to lose passengers who thought the ride-sharing service was more comfortable and cost-effective.

This led the government to intervene and consider a fair policy for both taxis and ride-sharing services.

“A number of countries have added a provision in their existing law to use private cars commercially to work in favour of the public interest,” said Professor Shamsul Haque of the civil engineering department at Bangladesh University of Engineering and Technology.

In Singapore, ride-sharing services such as Uber must have drivers who are required to follow a different and new set of regulations after local taxi operators forced a change in the law. These regulations differ in the sense that they have different criteria such as age, hours of training, and driving experience.

However, Uber has yet to hit the private rental market in Dhaka despite a shortage of supply: the capital boasts only 450 taxis operating under two companies – Toma and Trust.

Khaled Mahmood, owner of Khaled rent-a-car and also joint secretary for the Dhaka Rent-a-car Association, told the Dhaka tribune that the Uber model was yet to affect his business.

“We do not do trips like they do under the Uber model. Generally, people hire cars from us for a day or on a half-day basis, not just for a trip,” he said.

Ataur Rahman Buiyan Manik, managing director of Toma, was unavailable for comment.

Short road to success

Uber, headquartered in San Francisco, US, launched its service in 2009 and soon gained immense popularity. The mobile app-based transportation networking company serves commuters like a middleman to meet their requirements of hiring a car or taxi.

Uber is a global company but does not manufacture any product. As a result, they require no permission from Bangladesh Investment Development Authority (Bida) to operate in the country.

Bida Director (Registration and Incentives Foreign Industry) Sabina Yeasmin told the Dhaka Tribune: “We give approval if a global company is investing and manufacturing a product. But Uber is not like that, they do not invest and manufacture products.”

Shyam Sunder Sikder, the secretary of the ICT Ministry, told the Dhaka Tribune that there is no legal barrier to operating apps like Uber in Bangladesh. “But there is the issue of using private vehicles for commercial purposes – it is not allowed here,” he said.

An Uber spokesperson told the Dhaka Tribune by email that the company was “thankful for all the cooperation and support” that it has received from the government of Bangladesh.

“We admire the government’s intent and vision for redefining the urban mobility landscape in Dhaka and beyond,” it said.

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