Kenyan digital taxi drivers have threatened to deactivate their applications due to the government’s delay to publish the Digital Hailing Service laws (TNC Rules 2022), which were ratified by the Senate labor committee chaired by Senator Johnson Sakaja.

The Digital Taxi Forum (DTF) issued a seven-day ultimatum on Friday, saying they will boycott and turn off Uber, Bolt, Little Cab, and any other apps operating in Nairobi, Nakuru, Mombasa, Kisumu, Nyeri, and any other town or city if they did not comply.

Here Is What You Need To Know

• The National Transport and Safety Authority (NTSA) proposed legislation that would, among other things, bar digital hailing service operators from charging a commission of more over 15%.

• Most ride-hailing companies in Kenya currently charge a commission of at least 20%, with Uber taking the biggest cut at 25%.

• The failure of the Transport Cabinet Secretary, James Macharia, to gazette the Digital Taxi Regulations, according to Secretary-General (SG) of DTF Wycliffe Alutalala, has resulted in serious suffering for drivers and car owners who have long decried unfair regimes by international ride-hailing firms.

“It is unfortunate that one year down the line, CS Macharia has either refused, neglected, declined, or ignored to gazette the Regulations for reasons best known to himself,” lamented SG Alutalala.

• If implemented, the law will also compel overseas digital taxi companies to establish a subsidiary in Kenya and pay a Sh500,000 application cost as well as a Sh300,000 yearly renewal fee.

• Under the proposed law, Operators of digital hailing services are banned from levying or charging any additional costs, levies, or fees in addition to the commission.

• If passed, the law will allow ride-hailing companies to report the name, driver’s license number, and vehicle registration number of a rogue driver who has been deactivated from the platform due to misconduct that poses a threat to public safety to the National Transportation Safety Administration (NTSA).

“Any person who contravenes any provision of these regulations commits an offense 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 proposals read in part.

• Uber and Bolt had opposed to the capping of commissions at 16 percent in a letter to the Ministry of Transport dated November 29, 2021, claiming that it was “discriminatory and disincentivizing to investment in the business.”

“While the proposed regulations are largely progressive, certain components are discriminatory, specifically the proposed 15 percent cap on commissions, Setting a precedent of such prohibitive regulations could lead to a broader impact on the industry. The proposed regulatory pricing control will only serve to limit innovation and competitiveness in the ride-hailing industry,” the firms said.

Read also Chad Abolishes Import Taxes On Smartphones, Computers, Tablets For Five Years

Kenyan Digital taxi Kenyan Digital taxi

Cameroonian Fintech Startup Maviance Secures Additional Funding From Finafrik 

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer