REGULATIONS

Win for digital taxi drivers as proposed laws cut commission to 15%

In September, Bolt (formerly Taxify) which was charging the least commission of 15 per cent raised it to 20 per cent

In Summary
  • Currently, most firms operating in the country are charging a commission of at least 20 per cent, with Uber slashing drivers' pay highest at 25 per cent.
  • The government is however eyeing taxes from drivers. Those operating digital taxis must be registered tax payers with their KRA PINs
An illustration picture shows the logo of Uber on a smartphone next to the picture of an official German taxi sign September 15, 2014
An illustration picture shows the logo of Uber on a smartphone next to the picture of an official German taxi sign September 15, 2014
Image: REUTERS

International digital taxi firms will be required to set up a subsidiary in Kenya and pay an application fee of Sh500,000 and annual renewal fee of Sh300,000.

This means, firms like Uber which is domiciled in San Fransisco, US will have to registered with a certificate of compliance by the Registrar of Companies or cooperative societies with a permanent office in Kenya.

Drivers on other hand will have to part with an annual license fee of Sh3500 and further Sh1000 every year for the renewal of digital hauling badge.

 

These are just among a number of measures both digital taxi app owners and drivers will have to meet if the proposed Digital Hauling Operators Regulation, 2019 sees the light of the day.

The proposals by the National Safety and Transport Authority (NTSA) if passed will be incorporated in the National Transport Safety Authority Act.

The proposed law prohibits digital hailing service operators from charging a commission of more than 15 per cent, an aspect that is likely to see drivers take more home.

Digital hailing service operators are prohibited from levying or charging other charges, levies or fees over and above the commission.

This is likely to calm drivers who have on many occasion downed tools to protest exploitation by app owners.

Currently, most firms operating in the country are charging a commission of at least 20 per cent, with Uber slashing drivers' pay highest at 25 per cent.

In September, Bolt (formerly Taxify) which was charging the least commission of 15 per cent raised it to 20 per cent.

 

The government is however eyeing taxes from drivers. Those operating digital taxis must be registered tax payers with their KRA PINs indicating that they are in business.

They are not allowed to use vehicles older than seven years for the taxi hauling activities.

In bid to sieve crime in the sector, the law proposes that an operator must have in place a process to notify and report to the Authority the name, driver’s license number and vehicle registration number of an affiliated digital hailing service driver deactivated from the operator’s platform for conduct that gave rise to a public safety concern.

''A person who contravenes any provision of these Regulations commits an offence and is liable on conviction to a fine not exceeding Sh20,000  or to imprisonment for a term not exceeding six months or both,'' the draft law reads.

The Authority may in addition to any other penalty prescribed under these Regulations may suspend or revoke any license issued under this Regulation.