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February 15, 2019

Summary sent to CM to regulate ride-hailing services


February 15, 2019

The Sindh Transport Department has forwarded a summary to the chief minister seeking his approval for passing a piece of legislation from the provincial assembly to amend the motor vehicle laws so that legal cover can be provided to the two major ride-hailing services operating in Karachi and other cities.

Moved by the transport & mass transit secretary, the summary seeks amendments to the Motor Vehicles Ordinance 1965 and the Motor Vehicles Rules 1969 to make provisions for the operations of the two major ride-hailing services using private vehicles as taxis.

After the piece of legislation is passed, formal route permits will be issued to the private motor vehicles being used as taxis, as well as other formalities will be completed to bring them within the ambit of law.

The summary stated that both the companies are plying their vehicles on roads as online public passenger services similar to taxis, initially starting in Karachi and then extending their services to other cities of the province as well as to other parts of the country.

“These online public passenger services are ride-hailing hire-dispatch companies, operating their businesses through private vehicles. There is no provision for online public passenger services in the Motor Vehicles Ordinance 1965 or the Motor Vehicles Rules 1969,” read the summary.

“Resultantly, the transport authorities and enforcement agencies are facing great difficulties to bring their operation at par with transport vehicles in the public transport sector.

“In the year 2002, the then labour, transport, industries & commerce department on consideration of a request for the introduction of a Radio Cab Service within Karachi had processed the request in exercise of powers conferred under Rule-4 of the Motor Vehicles Rules 1969 and allowed exemption from display of commercial number plates to the Radio Cab vehicles until such a time the vehicles are in operation.

“The service was accordingly allowed to display private number plates on the Radio Cabs on the payment of additional 10 per cent motor vehicle tax per vehicle to the excise & taxation department, motor registration wing.

“The Capital Territory, Islamabad Administration has exempted operation of the Motor Vehicles Rules 1969 on private motor vehicles of internet, online, platform or marketplace companies that enable riders or users to book trips directly from drivers through the internet platform, marketplace or application upon standardised terms and conditions.”

A statement issued on Thursday quoted Transport Minister Syed Awais Qadir Shah as saying that the online taxi service in the province had to pay the due taxes to the provincial government, for which purpose the Motor Vehicles Ordinance will be amended.

He said cars being used under the ride-hailing service had to be registered with the provincial transport department because the online taxi service had to abide by the rules of relevant department for their operations.

Shah said that non-commercial vehicles in the province could no more be used as taxis, as the vehicles used under the ride-hailing service had to obtain the route permits for their operations.

The minister said that companies engaged in the provision of ride-hailing services had to take out insurance for the passengers and luggage being transported through the online taxi service.

He said that the proposed amendments in the motor vehicle laws would improve the standard of the service of online taxis in the province in order to protect their customers from undue hardships.

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