The National Transport Act in South Africa has recently been amended, granting the Transport Minister, Sindisiwe Chikunga, the authority to regulate ride-hailing prices. This marks a significant shift from the previous model where pricing was determined solely by the ride-hailing platforms themselves.
Melithemba Mnguni, the secretary of the E-Hailing Partners Council, expressed his enthusiasm about the amendments during an interview with 702. He described the changes as long overdue and noted that the latest draft, to which they made submissions, tackled critical issues such as pricing, safety, and communication between operators and the platforms.
Mnguni explained that ride-hailing operators have faced challenges with the pricing structures, feeling underpaid and dealing with market oversaturation leading to decreased earnings. He revealed that ride-hailing platforms had initially opposed the amendment that would allow the minister to set prices and had attempted to have it removed.
The operators view the new pricing regulation as beneficial, as it addresses the imbalance where platforms set prices without bearing any operational costs. Mnguni expressed optimism that the new system, under the minister’s guidance, would be more inclusive and take into account the inputs of the operators.
However, Kenny Moretsele, a Bolt operator and chairperson of the Ekurhuleni e-hailing association, pointed out a potential issue with the amended regulations. He is concerned that the industry may continue to experience price dumping due to the lack of clarity and specificity in the bill’s price regulation sections.
After a thirteen-year wait, President Ramaphosa signed the amended act into law, a move that was intended to modernize the legislation to encompass e-hailing services. The Department of Transport has welcomed the signing of the Amendment Bill and outlined the forthcoming steps, which include submitting regulations to the Office of the State Law Advisor for certification and then to the Minister for approval. This process is expected to further define the operational framework for ride-hailing services under the new law.
The recent amendments to the National Land Transport Act of 2009, as encapsulated in the National Transport Act amendment bill, have introduced significant changes to the regulatory framework governing ride-hailing services in South Africa. One of the key changes is that ride-hailing services will no longer be required to obtain and operate under charter permits and meter taxi operating licenses.
Transport Minister Sindisiwe Chikunga explained that the bill updates the National Land Transport Act to align with the latest developments in the transport sector. It aims to simplify existing provisions, address issues that have emerged since its implementation, and make room for non-motorized and accessible transport options. Chikunga emphasized that the revised National Land Transport Act (NLTA) now mirrors the government’s dedication to fostering a contemporary, inclusive, and efficient transport system.
Furthermore, the amendments enhance Minister Chikunga’s authority to introduce new regulations and safety protocols, as well as to improve the administrative process for issuing operating licenses.
The ride-hailing industry has long faced difficulties in securing operating licenses, a concern that has persisted for years. In March 2020, the then Transport Minister Fikile Mbalula presented these amendments to the National Assembly. He highlighted that the changes would establish a new category for operating licenses and compel service providers to tackle the issue of illegal operators on their platforms.
Mbalula warned that non-compliance with the regulations could result in substantial fines, with penalties reaching up to R100,000. He also noted that the bill aims to bolster regulatory enforcement by empowering Provincial Regulatory Entities with the ability to withdraw or suspend operating licenses if an operator violates the National Land and Transport Act or the Roads Act.
The bill addresses additional concerns, such as the management of public complaints, the treatment of passengers, and the implementation of color coding. It also ensures that members of the South African Police Service (SAPS), metro police, and other law enforcement agencies do not have business interests in public transport operations.
Mbalula expressed optimism that the revised regulations would help mitigate conflicts between metered taxi drivers and ride-hailing service drivers, which have been a source of tension in the industry.
