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South Africa Enacts Law to Legally Accommodate Ride-Hailing Services


President Cyril Ramaphosa has signed the amended National Land Transport Act into law, addressing the long-standing need to accommodate and regulate ride-hailing services in South Africa. This landmark legislation paves the way for ride-hailing operators, such as Bolt and Uber, to obtain operating licenses, aligning them with other public transport providers.

The amended Act eliminates the requirement for ride-hailing companies to obtain charter permits and meter taxi operating licenses, which had previously hindered their operations. This move recognizes the unique nature of their business model and streamlines the licensing process.

Alongside the National Land Transport Amendment Bill, President Ramaphosa signed two other bills into law. The journey to enact these changes, however, has been a lengthy one, with the Amendment Bill initially submitted to the National Assembly in 2020 but returned for reconsideration.

Transport Minister Sindisiwe Chikunga welcomed the development, stating that after signing, the regulations will undergo certification by the Office of the State Law Advisor before being submitted to the Minister for final approval.

Chikunga emphasized that the Bill updates the National Land Transport Act of 2009 to reflect recent developments in the transportation sector. It simplifies provisions and addresses issues that have arisen since the Act’s implementation. Additionally, the Bill incorporates provisions for non-motorized and accessible transport, reflecting the government’s commitment to a modern, inclusive, and efficient transport system.

According to reports, the former Transport Minister, Fikile Mbalula, who initially submitted the amended Act in March 2020, noted that the amendments create a new category of operating licenses for ride-hailing services. The legislation also requires technology providers to prevent illegal operators from using their platforms, with non-compliance punishable by fines of up to R100,000.

Furthermore, the bill strengthens regulations, allowing for license revocation and suspension in case of violations. It addresses public concerns and aims to reduce conflicts between metered taxi and ride-hailing drivers, which have been a contentious issue in the past.

While ride-hailing companies in South Africa may view this as a significant win, their counterparts in Kenya face a potential challenge. Kenya’s proposed Finance Bill 2024, which includes a 6% Significant Economic Presence (SEP) Tax, has raised concerns among ride-hailing operators in the country. They have expressed dissatisfaction, arguing that the tax disregards their operating costs and resulting net losses for passengers.

As South Africa embraces the regulation of ride-hailing services, it marks a pivotal step towards modernizing the country’s transportation landscape and ensuring fair competition among all players in the industry.



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