Famous taxi service is going through a legal crisis in Colombia and is now being regulated by the government
President Santos gave Uber, one of the world’s biggest taxi app services, six months to legally formalise their business or face a total ban of their operations in Colombia, on November 23.
The ‘luxury’ taxi phone application service, operating in the country since 2013, has faced heavy scrutiny from traditional taxi companies, who claim Uber operates on an unfair basis in terms of driver payment and evading government taxes.
The order that Santos presented to the taxi drivers’ union and Uber says that “to be able to provide a luxury taxi service, providers will have to convert to, or set themselves up as, companies providing this service”.
That means that they will have to buy cars, buy quotas (in a market that taxi drivers already control) and work and compete as if they were a traditional company. Although La Silla Vacia highlight the intrinsic problems with the new regulations saying “it’s like asking despegar.com to form their own airline”.
According to Transport Minister Natalia Abello, some of the requirements set by the government to regulate luxury taxi transport include providing high end black vehicles with a side strip identifying them, qualified drivers with customer service skills and accredited technological platforms to deliver the service.
“The service will always be used by electronic platforms and the payment will also be electronic. When we speak of luxury service we mean conditions of comfort, accessibility and a superior operation above the basic service”, Abello said.
Although currently operating illegally, Santos has allowed a six month leeway for the company to sort out their formalities and abide by the regulations that have been set to allow them to compete in the country.
He also passed control of the matter onto Congress to monitor from now on.
Taxi drivers have shown their approval for the ruling that they have been working on obtaining for over two years.
According to La Silla Vacia, taxi company owner Uldaric Peña said, “We’re going to follow it through to the small print… it is clear that Uber is illegal and will not be able to work as it is working now but that it will enter into competition.”
Mike Shoemaker, Manager of Uber in Colombia, said that they are going to analyse each of the items on the regulations in detail and take the necessary action.