MV Act: Parliament gives govt powers to set ground rules for Uber, Ola cabs

Updated on Aug 01, 2019 12:38 AM IST

The law, which has been pending approval in Parliament since three years will also give the government power to set ground rules for taxi aggregators such as Ola and Uber that had been operating in a grey area for years.

The Bill has been passed with three Government amendments and will need to go back to Lok Sabha.(PTI Photo)
The Bill has been passed with three Government amendments and will need to go back to Lok Sabha.(PTI Photo)
Hindustan Times, New Delhi | By

App-based taxi-hailing services such as Uber and Ola are going to come under the government’s regulatory network. The Rajya Sabha on Wednesday cleared a landmark motor vehicles amendment bill that aims to put road safety at the top of its agenda, raise penalties for violations and land liberate the mobility sector.

The Bill has been passed with three Government amendments and will need to go back to Lok Sabha. The Lok Sabha had already passed the Bill on the July 23, 2019. The amendments in the Bill mainly focus on issues relating to improving road safety, citizens’ facilitation while dealing with the transport department, strengthening rural transport, last mile connectivity and public transport, automation and computerization and enabling online services.

The law, which has been pending approval in Parliament since three years will also give the government power to set ground rules for taxi aggregators such as Ola and Uber that had been operating in a grey area for years.

The Bill defines aggregators as digital intermediaries or market places which can be used by passengers to connect with a driver for transportation purposes (taxi services). These aggregators will be issued licenses by state Further, they must comply with the Information Technology Act, 2000.

The Motor Vehicles Act, framed in 1988 and last amended in 2001, doesn’t cover ride-sharing services, allowing them to run without a licence.

Under the Motor Vehicle (Amendment) Bill, 2016, an “aggregator” has been defined as means a digital intermediary or market place for a passenger to connect with a driver for the purpose of transportation”.

In its final form, the bill cleared by parliament mandates that cab aggregators get a licence from the state government. The states would have to be guided by the policies drawn up by the Centre.

Between the two, officials say the power to regulate taxi aggregators would include the power to fix check arbitrary charging, the biggest customer grouse.

Violation of licensing norms will invite a fine of up to 1 lakh.

In the past, road ministry functionaries have spoken about the government’s intention to allow taxi aggregators to have surge pricing but stipulate that it stays within a reasonable range.

The Aam Aadmi Party government in Delhi had attempted to regulate cab services in 2015 but didn’t get far.

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