Punjab, Sindh move to curb ride-hailing apps

Sindh minister gives companies a month to fulfil legal obligations .

LAHORE/ KARACHI: Punjab and Sindh have made moves towards curtailing the use of unregulated ride-hailing smartphone apps in their metropolises.

A Punjab transport department notification, which declared private cars working under the banner of Careem, Uber and A-One as ‘illegal’, surfaced on Tuesday. Although a senior provincial government official later downplayed the move, Lahore transport officials said they have been given a green signal to start a crackdown from today (Wednesday).

Sindh authorities followed suit, saying they were seeking legal action against Careem and Uber while asking the Pakistan Telecommunication Authority (PTA) to block their smartphone apps. However, PTA told the provincial government it lacks the power to block the ride-hailing apps. Later, due to severe backlash in the transport-starved city, Sindh Transport Minister Nasir Hussain Shah gave the two companies a month time to fulfill legal requirements.

Islamabad authorities are also considering a ban on the ride-hailing services, sources in capital administration said.

Authorities in both provinces justified the moves by saying that the startups providing the ride-hailing services were unregulated and had not obtained necessary clearances or paid the required taxes.

The Punjab transport department notification – which was issued on January 27 and requested immediate action from the Lahore Transport Company (LTC) and traffic police – said the ‘taxi services’ provided by Careem, Uber and A-One were operating with vehicles that were not registered with any regulatory body and had no fitness certificates and route permits. It pointed out that the vehicles in question were being used for commercial purposes despite being registered for private use and added that the drivers operating them had not obtained any security clearance.

Although Punjab Information Technology Board head and chief minister’s adviser Umer Saif downplayed the notification as an “internal document with no repercussions” for the ride-hailing services after it surfaced, he said the provincial government would soon bring a new taxation regime for Careem, Uber and their like.

Sindh Transport Secretary Tauha Ahmed Farooqui, meanwhile, said the management of Careem, Uber and similar services were supposed to obtain three types of no-objection certificates (NOCs).

“When private cars are used as commercial vehicles they have to pay Rs150 annually to the Excise and Taxation Department. Companies operating them must register themselves with the Regional Transport Authority (RTA) and obtain fitness certificates [for the vehicles] from that department as well,” he told The Express Tribune. “Only after these requirements are fulfilled can they operate freely.”

Farooqui said they have written around 12 letters to Careem to comply with the legal requirements. He said Uber’s management, while committing to fulfill the requirements, had so far only registered three of their vehicles. “These are minor legal requirements,” said Sindh Transport Minister Shah. “These companies fulfill them the world over, why not in Pakistan?”

However, Careem’s Managing Director in Pakistan Junaid Iqbal insisted that new laws were being drafted for ride-hailing services across the world. Careem Marketing Executive Tanzeela Aslam said that Careem’s partner company Carsure inspects each and every car they operate.

In Lahore, only minutes after Umer Saif’s media talk, LTC officials said they had received a green signal to proceed in accordance with the notification. They said they would begin a crackdown today (Wednesday) and devise a strategy to apprehend vehicles working for ride-hailing services in consultation with the quarters concerned.

In Karachi, DIG Traffic Asif Ejaz Shaikh confirmed they had received the transport secretary’s letter asking his department to immediately stop operations of Careem. However, he said traffic police will hold off any action for a month at least following the transport minister’s assurance.

Regarding how they would impound Careem and Uber vehicles which operate without any insignia, he said police officials could book rides using their respective smartphone apps and detain them when they show up. (WITH ADDITIONAL REPORTING BY OUR CORRESPONDENTS IN KARACHI AND ISLAMABAD)

Published in The Express Tribune, February 1^st, 2017.