A recently passed National Transport Act amendment bill will give South African transport minister, Sindisiwe Chikunga powers to set prices for ride-hailing operators in the country. President Cyril Ramaphosa signed the National Land Transport Act 5 into law last week, ending a 13-year wait for the updated Bill and putting the regulation in line with digital economy advancements since its implementation.
The Department of Transport welcomed its signing into law and highlighted the next steps. “Now that the President has signed the Amendment Bill, regulations will be submitted to the Office of the State Law Advisor for certification and submitted to the Minister for approval,” it said.
“The NLTA now reflects our commitment to a modern, inclusive, and efficient transport system”, said Sindisiwe Chikunga, South Africa’s Minister of Transport. “This Bill amends the National Land Transport Act of 2009 to bring it up to date with developments since the implementation and simplifies various provisions or solves problems that have arisen since the implementation, and makes provisions for non-motorized and accessible transport,” she explained. said Chikunga.
Recall that over 7,000 drivers signed an online petition on Change.org last year, urging the government of South Africa to speed up the process of enacting the Bill, complaining it had not seen much progress since it was passed by Parliament in 2020.
In a recent interview, Melithemba Mnguni, Secretary of the E-Hailing Partners Council said that ride-hailing operators are excited about the new amendments. “We have had issues with pricing whereby we feel like we’ve been underpaid. There are also issues of overflooding the market with too many operators and earnings decreasing”, he said.
Mnguni also indicated that ride-hailing platforms were previously against the amendment. However, he believes the new development is inevitable as the ride-hailing companies bear the least of the service cost.
“The business setup has been inappropriate whereby the e-hailing platforms are the ones that come up with pricing, yet they don’t carry any responsibility as far as operational costs are concerned,” he explained.
The amendments also expand Chikunga’s powers to implement new regulations and safety measures while streamlining the administrative side of processing operating licences.
Previously, these companies operated in a legal grey area, relying on charter permits and metre taxi operating licences that needed to be a better fit for their business model. Under the new regulations, ride-hailing service providers will no longer be required to apply for and use charter permits and meter taxi operating licences.
Concerns over the ride-hailing companies’s inability to obtain operating licences in South Africa have been around for years. In March 2020, former transport minister Fikile Mbalula said he had presented the amendments to the National Assembly, adding that they create a new category for operating licences and force providers to address illegal operators on their platforms.
The national public transport regulator and provincial regulatory entities are responsible for issuing operating licences that allow individuals to operate road-based public transport
services. This power can, however, be assigned to municipalities.
Bolt operator and chairperson of the Ekurhuleni e-hailing association, Kenny Moretsele told My Broadband that a potential challenge that could arise from the amended regulations. He said this is because the price regulation aspects of the bill are unclear and vague. “We are still going to suffer the same trend of price dumping in the industry”, he said.
He noted that the Act legalises the operations of e-hailers in South Africa and recognises them as transport companies, as opposed to tech companies, as they were previously registered.
It also creates some level of trust as Bolt drivers have been the subject of several misconduct and insecurity reports, which led the platform to block more than 6,000 drivers in the country in the last six months for misconduct.
