Drivers, Uber speak on ‘unclear’ new regulations on ride-hailing services in Lagos

The new regulations for ride-hailing operators in Lagos State are getting no love from the people whose activities they aim to regulate.
 
The regulations will come into effect on August 20; regulations the government said were necessary to reduce security risks, improve safety and curb flagrant flouting of existing traffic laws.
 
“The flagrant disobedience to road traffic rules and regulations by the drivers is unacceptable and all necessary steps must be taken to bring safety, sanity, standard and security back to the operation of the Business,” the government said in the guidelines.

“There is need to introduce accreditation scheme/registration that will have all the necessary and significant data of operators, drivers and the number of registered Taxi details of which will include the route and tag numbers. This exercise will go a long way to curb the excesses of the operators and drivers in the State.”
 
An operator and a representative of the drivers, however, told The Guardian on Tuesday that the provisions need fine-tuning.
 
Ayoade Ibrahim, the president of the National Union of Professional App-Based Workers, said in an interview on Tuesday that the regulations do not take cognisance of the operational challenges the drivers face.
 


“The major problem we have with the new regulations is the 10 per cent the government said they will charge on the commission we pay to the e-hailing companies,” Ibrahim said. “That clause is not clear to us.”
 
However, the section of the guidelines that mentions the deduction of 10 per cent on each transaction carried out on e-hailing platforms does not state in clear terms if the deduction will be made on the commissions paid by drivers to operators such as Bolt and Uber.
 
Section 4.1 (v) of the new guidelines says: “All operators of e-Hailing Taxi Services must pay the State Government 10% Service tax on each transaction paid by the passengers to the operators.”
 
Ibrahim feared operators will hike the percentage of the commission charged on each trip if the government taxes the commission paid by the drivers to the ride-hailing companies.
 
Apart from having to pay a ₦25 million licence fee and ₦10 million annually for the renewal of such licence, a provision like the service tax deduction is problematic for operators.

Although Uber, in an emailed statement, did not single out any part of the guidelines for condemnation, the ride-hailing giant said it was still studying how the new regulations will impact its operations and “network of driver-partners” in the state.
 
Emails sent to the West Africa regional manager of Bolt were not replied. 
 
“The current proposed regulations are inconsistent and unclear,” a spokesperson for Uber said on Tuesday.
 
The spokesperson for the Ministry of Transportation, Bolanle Ogunlola, was mum when asked about Uber’s comment on the guidelines.
 


The not-so-new new guidelines
A source told The Guardian in February that the state government was due to effect a set of guidelines for the operations of ride-hailing and taxi services from March 1.
 
Those guidelines did not come into effect on the said date.
 
Ibrahim insisted the guidelines, which he described as “out-dated,” are the same ones that will be operational from August 20 and that they were already drafted long before the Lagos State Government started inviting the drivers for meetings.
 
The information received by The Guardian in February checks out with some parts of the new guidelines, especially the part on the licence and renewal fees.
 

Ibrahim said the inputs the drivers gave during those meetings were discarded. Four drivers who spoke with The Guardian on Monday corroborated the union leader.
 
“These regulations will not help our business,” Segun Adeola, a driver, told The Guardian. “The government does not think about how we fuel our and maintain our cars.”
 
Like Ibrahim, Uber believed the new regulations should not be anachronistic.
 
“We have always been willing to engage with governments on regulations to ensure our operations align with best practices locally and internationally, as we believe regulations need to support innovative technology ideas that fit 21st-century businesses,” a Uber spokesperson said.
 
Key parts of the guidelines
While the drivers are vexed by the service tax, there are other key parts of the guidelines that may prove contentious when the implementation starts.

For instance, Section 3.11 of the guideline states that vehicles to be used as “taxicab” in the state must be “brand new”. Alternatively, such vehicles “must be within the first three (3) years of its manufacture as specified by the manufacturer.”
 
The vehicles are also to be subjected to special taxicab inspection protocol and must be submitted to the Ministry of Transportation once a year for inspection.
 
The taxicabs are also to be fitted with government-approved tags – in line with Section 16 of the Lagos State Transport Sector Reform Law 2018, which prohibits the use of unmarked vehicles for taxis in the states – and taximeters.

Ride-hailing companies are mandated to grant the state government access to their database. Drivers who are on those ride-hailing platforms must also be literate, certified annually by Lagos State Drivers’ Institute and have Lagos State Residents Registration Agency (LASRRA) Card and driver’s badge.

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