Government Could Soon Regulate Ola, Uber Thanks To Amended Motor Vehicles Bill

Government Could Soon Regulate Ola, Uber Thanks To Amended Motor Vehicles Bill

SUMMARY

Govt has approved amendments to the Motor Vehicles Bill to regulate Ola, Uber

The bill defines aggregators as digital intermediaries or marketplaces for transportation

The government will have the power to frame rules around pricing and safety

After throwing a curveball to ridehailing players with its electric vehicle mandate, the Indian government has now approved amendments to the Motor Vehicles Bill, which will allow the centre to regulate the likes of Ola and Uber. The government’s focus would reportedly be on passenger safety, comfort and would also tackle issues such as arbitrary or surge pricing.

The bill defines aggregators as digital intermediaries or marketplaces for transportation and does not recognise cab aggregators as a separate entity from other transport solutions. The bill now requires the President’s nod to become law as both houses of the parliament have now approved it.

“Once the new law (motor vehicles act) is in place, the government will have the power to frame rules to regulate cab aggregators. We can keep an eye on surge or arbitrary pricing, make them offer better services for passengers, such as well trained drivers. We will also keep in mind the crucial aspect of women’s safety,” a senior government official was quoted as saying by Mint.

An Uber spokesperson was quoted as saying that the bill acknowledges the role of technology in transforming mobility. “We will continue to support the government’s vision to harness technology for shared mobility and safety,” the spokesperson added.

While under the new law taxi permits would still be issued by the state transport department, but it would seek to introduce regulations for safety, pricing, reducing road accident fatalities, penalties for violations, anti-corruption initiatives. Under the current rules, isolated bans such as the ones seen in Karnataka, Tamil Nadu and other states are very common since state governments lay down these rules. States such as Delhi and Gujarat have called for stricter guidelines thanks to incidents that threatened safety of passengers, and also to tackle arbitrary pricing.

Taxi aggregators would still need to obtain licence from state government, under the new rules. The new rules also involve penalty between INR 25K and INR 1 Lakh for violating licensing conditions.

The new law could also give the government more control over its plans to transition ridehailing platforms to electric mobility. In May this year, a government meeting involving NITI Aayog officials and the ministries of road transport, power, renewable energy and steel, as well as the departments of heavy industries and trade, cab aggregator platforms such as Ola and Uber were directed to convert 40% of their fleet to electric vehicles by April 2026.

Ola and Uber would need to start converting their fleet to EVs from next year and achieve 2.5% electrification by 2021, 5% by 2022, 10% by 2023, before hiking it to 40% electrification by April 2026.

You have reached your limit of free stories
Become An Inc42 Plus Member

Become a Startup Insider in 2024 with Inc42 Plus. Join our exclusive community of 10,000+ founders, investors & operators and stay ahead in India’s startup & business economy.

2 YEAR PLAN
₹19999
₹7999
₹333/Month
Unlock 60% OFF
Cancel Anytime
1 YEAR PLAN
₹9999
₹4999
₹416/Month
Unlock 50% OFF
Cancel Anytime
Already A Member?
Discover Startups & Business Models

Unleash your potential by exploring unlimited articles, trackers, and playbooks. Identify the hottest startup deals, supercharge your innovation projects, and stay updated with expert curation.

Government Could Soon Regulate Ola, Uber Thanks To Amended Motor Vehicles Bill-Inc42 Media
How-To’s on Starting & Scaling Up

Empower yourself with comprehensive playbooks, expert analysis, and invaluable insights. Learn to validate ideas, acquire customers, secure funding, and navigate the journey to startup success.

Government Could Soon Regulate Ola, Uber Thanks To Amended Motor Vehicles Bill-Inc42 Media
Identify Trends & New Markets

Access 75+ in-depth reports on frontier industries. Gain exclusive market intelligence, understand market landscapes, and decode emerging trends to make informed decisions.

Government Could Soon Regulate Ola, Uber Thanks To Amended Motor Vehicles Bill-Inc42 Media
Track & Decode the Investment Landscape

Stay ahead with startup and funding trackers. Analyse investment strategies, profile successful investors, and keep track of upcoming funds, accelerators, and more.

Government Could Soon Regulate Ola, Uber Thanks To Amended Motor Vehicles Bill-Inc42 Media
Government Could Soon Regulate Ola, Uber Thanks To Amended Motor Vehicles Bill-Inc42 Media
You’re in Good company