New road safety law to cover taxi aggregators

Economic Times, December 18, 2014

The government has inserted online taxi aggregators into a proposed new road safety law it plans to bring in Parliament, potentially ending the regulatory ambiguity surrounding firms such as Uber, Olacabs and TaxiForSure whose operations have come under sharp focus following the rape incident in Delhi earlier this month.

The ministry for road transport and highways has amended the draft of its proposed Road Safety and Transport Bill to include aggregators, a move that will finally acknowledge the existence of these firms while also empowering authorities to act against any wrongdoing or lapses by them. The December 6 rape in Delhi of a woman passenger by a cab driver on Uber’s network brought into sharp focus the regulatory grey zone in which these mobile-appbased taxi aggregators have been functioning. Unlike regular radio taxis whose existence is recognised under the law and overseen by regulation, aggregators aren’t, even though their operations have grown rapidly in the past year.

Aggregator firms, before the rape crisis hit them hard by triggering bans by several states, had more than 50,000 cars on their networks across cities, and had helped drive fares down in several places. Most of these firms enrolled cars registered as tourist taxis into their networks, which were then organised and deployed using mobile apps to offer point-to-point taxi services.

Officials said until now these taxi-hailing apps were not under any regulation on the technicality that they were not the “operators” of taxis but simply “aggregators”. The road transport ministry headed by Nitin Gadkari, who last week publicly opposed a ban ordered by the home ministry, has now clearly and unequivocally put the word “aggregator” into its proposed new Road Transport and Safety Bill, 2014, which it plans to introduce in Parliament during the ongoing winter session.

“The appropriate authority… require a passenger transport service operator or aggregator or any concerned person to furnish any information relating to the matters specified in sub-section (2) which is in their possession or control,” the proposed law says.

Acknowledging aggregators in a central law and framing the dos and don’ts for their operations will make the job easier for states to register and eventually regulate them. The new bill also provides for an appropriate authority to ask any company providing any kind of taxi booking services to furnish information regarding the total number of journeys undertaken, structure of fares and the total distance covered by the vehicles. “It is reasonable to expect him (the operator) to provide it…digitally or in any form,” it says.

Taxi industry executives said bringing aggregators under the purview of the law was required. “It is very important that these services be brought under the ambit of accountability. We have been asking for a comprehensive policy for urban taxis which will define these services clearly for a long time,” said Kunal Lalani, president of the Association of Radio Taxis.

A senior government official told ET that the concerned body, which will exercise these powers, will be notified by the national, state or unified metropolitan transport and the implementation of most of these policies would be done at the state level.

Besides the new regulation, the government has also floated a Cabinet note for the use of its Rs 1,000-crore Nirbhaya fund to create a GPS-based vehicle tracking system to be launched in 32 cities. The proposed road safety bill also lays stress on the security of women and school children.

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