Centre to issue advisory to states on app-based cab services

The Union ministry of road transport and highways is likely to issue an advisory on Friday to all states, asking them to take a call on regulating mobile application-based cab services. It will ask states to put adequate checks in place to monitor these services.

At present, mobile application-based taxi operators are not regulated, as they are not registered as a taxi service. The Centre plans to bring app-based taxi operators under the purview of the proposed road transport and safety legislation and place their fare structure under the scrutiny of the proposed National Transport Authority.

“We have been working on coming up with an advisory for all states regarding issues plaguing this space. We interacted with quite a few states, including Delhi, Maharashtra and West Bengal, and their respective state transport mechanisms over the app-based taxi hiring industry. The advisory is likely to be issued tomorrow (on Friday),” said a senior road transport and highways official.

In line of the recent moves to regulate the cab aggregator space, the draft Bill has re-defined these services as a "digital intermediary or marketplace for a passenger to connect with a driver having the requisite qualifications under the laws in India". Companies like Ola, Uber, TaxiForSure would not be allowed to own, lease any vehicle, employ any drivers or represent themselves as a taxis service unless they register. They also need to be compliant with the Information Technology Act.

The Department of Electronics and Information Technology (DeitY) had sought views from the transport ministry on how to proceed with blocking such apps nationwide. The ministry said the states could individually take a call on it.

The ministry held deliberations with executives from such app-based taxi companies to help formulate a mechanism that avoids a blanket ban.