On Monday, the cabinet approved the ‘Ride-Sharing Service Policy’, a little over a year after Uber started operating in the country.
San Francisco-based Uber, which operates in 633 cities worldwide, kicked off operations in capital Dhaka on Nov 22, 2016 and quickly became a hit with the riders.
Local motorcycle-based service Share a Motorcycle or SAM was operating in the city before then and after Uber’s launch, another startup Pathao entered the market with motorcycles afterwards, which now also offers cars.
Soon after Uber started operating, the Bangladesh Road Transport Authority or BRTA wrote to it saying that the existing laws does not approve of its operations and asked it to shut them.
On Nov 29, representatives from Uber and SAM met the BRTA chief.
In February 2017, the regulators moved to draft a policy, which was forwarded to the road transport ministry in June the same year and got the final approval on Monday
Cabinet Secretary Mohammad Shafiul Alam told the media that companies will have to obtain a ‘Ride Sharing Enlistment Certificate’ from the regulators.
Car or motorcycle owners will also be required to obtain it from the BRTA before using their vehicles to offer ride-sharing services.
The existing law does not allow vehicles registered against private individuals to be used for commercial purposes, but the new policy lifts that prohibition.
However, a newly registered vehicle has to wait for a year before it can be used for ride-hailing services.
Ride-sharing service providers have to operate as a public or private limited company and will have to pay taxes.
The BRTA will fix the coverage area of ride-sharing services according to passenger demand, road network capacity, number of vehicles under a company and its technological efficiency.
Cabinet Secretary Shafiul said the companies will not have to share their revenue with the government, but the one-year term enlistment certificate will cost Tk 100,000 with an annual renewal fee of Tk 10,000.
Ride-sharing service fare will be fixed in line with the existing Taxicab Service Guidelines, he added.
Uber faces stricter EU regulations after the European Court of Justice ruled it as a transport company recently.
Its officials, however, maintain that services in Bangladesh were legal despite the absence of a regulatory framework.
In a media briefing last month marking its one year in Dhaka, the company said more than 10,000 active car drivers operate under its network every month to cover the city with nearly 20 million inhabitants.
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