Govt plans to cap commissions for taxi aggregators at 10% of total fare; likely to release draft rules in December

Uber on Monday was stripped of its licence to carry paying passengers in London for the second time in just over two years, pending an appeal, over a “pattern of failures” on safety and security.

FP Staff November 28, 2019 17:15:41 IST
Govt plans to cap commissions for taxi aggregators at 10% of total fare; likely to release draft rules in December
  • Apart from the Centre, the state governments are also able to impose a charge on the aggregatorsÃ���Ã�¯Ã�¿Ã�½Ã���Ã��Ã�¢Ã���Ã��Ã�¯Ã���Ã��Ã�¿Ã���Ã��Ã�½Ã���Ã��Ã�¯Ã���Ã��Ã�¿Ã���Ã��Ã�½ earnings

  • On Monday, Uber was stripped of its licence to carry paying passengers in London for the second time in just over two years over a 'pattern of failures' on safety and security

  • In July this year, the Supreme Court had asked the Centre to consider bringing a law to regulate app-based taxi services for the safety of women passengers

The government is planning to put a cap on the commission taxi aggregators such as Uber and home-grown Ola earn on rides to a maximum 10 percent of the total fare, according to a news report.

This is the first time the government is looking to regulate the commission collected by such firms, which currently stands at about 20 percent and a draft on the rules likely to be released by the end of the year, said a report in The Economic Times.

Even though the Centre plans to cap the commission per ride, the state governments are also able to impose a charge on the aggregators’ earnings, the report said citing the guidelines shared with state officials.

Govt plans to cap commissions for taxi aggregators at 10 of total fare likely to release draft rules in December

Representational image. Reuters

"We are planning to release the draft (aggregator rules) for public feedback sometime next week. It will largely be in line with the guidelines that were shared, with a few small changes," a road transport and highways ministry official was quoted as saying in the report.

ANI Technologies (which runs Ola) saw its total income rising close to 16 per cent to Rs 2,155.21 crore in FY19 from Rs 1,860.61 crore in the previous fiscal, as per regulatory documentrs filed with the Corporate Affairs Ministry.

Its employee benefits expense has been lowered to Rs 413.83 crore in FY19 from Rs 495.69 crore in FY18.

Uber on Monday was stripped of its licence to carry paying passengers in London for the second time in just over two years, pending an appeal, over a “pattern of failures” on safety and security.

Unauthorised drivers were able to upload their photos to others’ accounts so that, on at least 14,000 trips, a driver other than the advertised one picked up passengers, the regulator Transport for London (TfL) said.

The ride-hailing firm immediately said it would appeal. The process is likely to include court action and could drag on for months, allowing Uber’s roughly 45,000 drivers in London, one of its most important markets, to keep taking rides despite its license expiring on Monday.

TfL said it had “identified a pattern of failures by the company including several breaches that placed passengers and their safety at risk”, and that some journeys had been uninsured.

“TfL does not have confidence that similar issues will not reoccur in the future, which has led it to conclude that the company is not fit and proper at this time.”

Uber, whose app-based ordering and demand-sensitive pricing have disrupted operators in many cities worldwide including drivers of London’s “black cabs”, said its systems were robust and that it would also introduce a new facial matching process.

In July this year, the Supreme Court had asked the Central government to consider bringing a law to regulate app-based taxi services like Ola and Uber for the safety and security of the women passengers.

A bench headed by Justice SA Bobde was hearing a petition filed by Nipun Saxena.

With inputs from Reuters

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