Indigenous electronic-hailing operators may hijack an already made e-taxi market services from an international operator, Uber, should the company fail to comply with Lagos Government’s new regulations designed for operations of the modern taxi system within the state.
With the new regulations, there is an indication that Uber days of operation in Lagos are numbered, in case the company is not able to find a common ground with the state government on its new order in another few days.
Findings by The Guild revealed that pressures have been mounted on the international taxi company to align with Lagos state government on few of its demands ranging from introduction of certain levies on operation of e-taxi, to compliance of Uber to some modalities been considered by the state as measures to ensure Lagos remain safer for residents.
But as learnt, the taxi company was not ready to bend to some of the state government’s wishes on grounds that it was more of a job creator than an ordinary e-hailing company compared to indigenous operators who had joined the market introduced by Uber.
And should Uber withdraw its services from Lagos market, a source from the state ministry of transportation disclosed to The Guild, there have been commitments from identified indigenous operators who have shown readiness to replace the international e-hailing company and provide a better service to Lagosians.
The source said that with the new regulations Uber might find it unfriendly and jet out of Lagos market and pave ways for indigenous operators that have shown genuine interest to thrive.
She disclosed that from Uber’s body language, the international e-hailing company was not likely to comply with Lagos state government new directives and introduction of levies on e-taxi operations just as it had demonstrated in order countries where similar regulations were been put in place.
The source said that the company claimed that since its arrival into Lagos market, it had created more jobs and remove thousands of unemployed people from a pull of job seekers in the state.
“Uber believes was that rather than the government to recognise its contribution and reward the effort, the state government was about to frustrate e-hailing company operations and chase it out of market through regulations”.
Another source, meanwhile, told The Guild that the state government was prepared for eventuality should Uber refused to comply with the newly introduced regulations.
He said that to ease the e-hailing operation in Lagos, the government has given operators a rebate on both renewals of licenses and registration of new operators so as to ensure smooth operation in the state.
“Lagos state government has given both Uber and operators avenue to operate by allowing some concession in area of licenses renewal fee and that of registration for new operators. Besides, the government action has also given e-hailing operators opportunities to up their games and the government is prepared should Uber derail.
“Uber non-compliance to new regulations is expected because the company is facing same problem globally, so Lagos will not be an exemption to the international e-taxi company”, the source added.
With Lagos newly introduced regulations, the e-taxi hailing company could end their six years relationship with commuters that have since relied on the services provided by Uber to travel within the state.
The international firm arrived Nigeria, particularly Lagos state in 2014, and two years after, it extended the services to commuters in Federal Capital Territory (FCT) Abuja, before taking its services to other states in the country.
In Lagos, the e-taxi hailing company provided employment for passionate youths and recorded its first one-millionth trip which took place on 16th July 2016 from Yaba, Lagos Mainland Local government to Lekki in Eti-Osa Council.
And for Uber to remain in Lagos beyond August 27th, the date set by the government for enforcement of the new regulations, it would have to accept conditions set for e-taxi company which includes paying government whenever its fleets increased even though the government announced downward review of renewal licenses.
In the communique agreed upon after a three hours meeting, the e-hailing operator would be paying N20 as Road Improvement Fund and would be levied on each trip made by drivers as well as ensure provision of comprehensive insurance that covers their drivers and passengers.
Other regulations announced by the government were that the operators must ensure 90-day compliance with documentation for the drivers, particularly to obtain Lagos State Residents Registration Agency (LASRRA) card- and that they must ensure due diligence and background checks on all drivers.
Uber and other e-taxi companies, according to the regulations, must work with various bodies in the business sector for a good relationship and that they must make necessary data available for the government.
Announcing the regulations after a three-hour meeting at State House in Marina, Commissioner for Transportation, Dr. Frederic Oladehinde, stated that the governor, Babajide Sanwo-Olu, offered a duty incentive to the operators, reducing their statutory operational licensing fee and renewal fee by 20 percent.
He noted that this implied that each e-hailing firm would pay N8 million per 1,000 cars fresh licensing and renewal, instead of N10 million initially announced.
Also, the commissioner, while reading the communique yesterday, explained that e-hailing operators would be paying N20 as Road Improvement Fund and it is to be levied on each trip drivers make daily as well as ensure provision of comprehensive insurance that cover their drivers and passengers.
Oladeinde said the new regulations were not initiated by the Government to extort the operators and drivers in the business, stressing that the government was moved by the necessity to regularise the ride-hailing operations in line with security measures.
Speaking on the controversial issue of data, he said: “We are not asking the e-hailing companies to release detailed data. All we are asking from them data for trip movement so that we can calculate the right charge and levy due to the Government. This data is to be supplied every week.
According to him, the regulations for the e-hailing companies will take effect from August 27, 2020. We have given an additional one-week extension for all operators to comply. Given that most of the drivers on the e-hailing platforms have third party insurance, the companies will have comprehensive insurance for each driver while the driver is working with them.
The commissioner added that the insurance policy would also cover passengers, in case of any eventuality, saying, this amounts to double insurance for the driver.
Also, Commissioner for Information and Strategy, Gbenga Omotoso, said there had been no strained relationship between the e-hailing operators and the State Government, pointing out that the new regulations were not to bring up a tax burden on the business.
“There is no iota of truth in the speculation that Lagos Government is introducing a new tax regime. The introduction of the new regulations is about security and smooth running of the business. It’s all about ease of doing business in the State,” he added.