AFK FOREX Report
New South African Law Will Force Uber Drivers To Be Licensed As Metered Taxis
By Dana Sanchez Published: March 7, 2016, 3:06 pm
In South Africa, drivers for Internet ride-hailing company Uber must now be licensed to operate as metered taxi operators — a regulation the Internet-based Uber has fought since its 2009 inception.
The South African Cabinet has approved a new transport bill that treats Uber operators as metered taxi operators, News24Wire reported.
The call for regulations for Internet ride sharing came into the spotlight in 2015 when Cape Town traffic officials impounded over 200 Uber cars because drivers did not have metered taxi permits.
Gauteng metered taxi drivers protested in 2015 against Uber and cars belonging to Uber claiming that Uber drivers have an unfair competitive advantage because of a lack of regulation.
Uber said it welcomes a new bill, which will make transport safer for everyone.
In every city Uber has entered, existing, highly regulated taxi and limo companies have tried to ban it, Forbes reported.
Based in San Francisco, Uber launched in 2009, allowing users in select cities to call and pay for rides using a smartphone app. Uber doesn’t provide its own vehicles or operators, but works with existing licensed drivers. Riders can track their dispatched drivers using GPS, and also rate the drivers.
Traditional taxi companies have called on state and local regulators to declare Uber illegal, in violation of decades-old laws often based on technical definitions of “meters,” “dispatch,” and “taxi,” according to Forbes.
In arguing against regulations that govern taxi companies, Uber and other ride-sharing competitors like Lyft and Sidecar say they are not taxi companies — they are technology companies, Salon reported. They only act as intermediaries, connecting drivers with passengers. As mere software brokers of a deal between two separate parties, they shouldn’t be regulated like a taxi company.
They don’t own cars, the argument goes, so how can they be a taxi company? In fact, when Uber was founded by Travis Kalanick and Garrett Camp, it changed its original name, UberCab, to Uber Technologies to provide regulatory cover, according to Salon:
Regulators in the U.S. have mostly swallowed this ridesharing whopper, hook, line and sinker. They have treated these companies by a different set of rules than taxi companies.
The South African Cabinet rejected Uber’s request to include a transportation category, “transport network operator,” for operators using technology to solicit customers.
However, Uber is calling the new South African regulations “progress.”
In an emailed statement to News24Wire, Uber Africa spokeswoman Samantha Allenberg said, “Uber respects the key role the national government plays in ensuring that South Africans have access to safe, affordable and efficient transportation options and we welcome this positive outcome.
“For over two years we have been actively working with regulators across South Africa to adopt appropriate regulations to accommodate new technologies that can help solve many of the current problems with urban transportation – safety, accessibility and lost productivity at work.
“We appreciate our ongoing conversations with these regulators and believe that consumers and communities will continue to benefit from the progress we have seen this far.”
Austin, Texas, has a reputation as one of most cutting-edge cities in the U.S., but new local regulations on ride-hailing apps such as Uber have been disconcerting for the tech sector, AP reported, according to Skift.
Mike Maples, a Silicon Valley venture capitalist with longtime ties to Austin, said government intervention in innovation increases risk.
“Startups are impossible to begin with, and if I’m going to invest in one, I have enough uncertainty without worrying about what the government’s going to do,” Maples said. “If I invest in a company that has high consumer appeal and could end up facing regulatory issues, that becomes a problematic investment.”
Sign up for the AFKInsider newsletter — the most compelling business news you need to know from Africa and the African diaspora, delivered straight to your inbox.