Out of the 75-page, here are the seven most important points.
26 April 2016 17:01
Brilio.net/en - It is still fresh on our minds when riots broke out in Indonesias capital last month and its roads were practically dominated by out-of-control taxi drivers. The violent protests by the mass public transport drivers on March 22 was the climax of a series of demonstrations in an attempt to get apps like Uber and Grab banned.
As featured in Tech in Asia, things have improved since then: Grab and Uber (and their newest competitor, Go-car), were given the green light from the government to keep operating. But as it seems move towards the right direction, the ministry of transportation Friday (22/4) laid out new rules for how transportation tech companies can co-exist.
Unfortunately, the new rules seem to bring new problems for the ride-hailing apps in Indonesia. One of them is requiring the apps to provide cars from existing transport providers instead of freelance drivers, a move that could hinder the growth of their business here.
The release of the 75-page regulation is actually a positive improvement for the app-based ride-hailing companies (though we doubt it, however), because it will eventually legalize their operation in the country. But on the other hand, it puts a lot of new obstacles in the startups way (see?).
Out of the 75-page, here are the seven most important points:
1. No yellow plates needed
One of the major thing the taxi companies questioned about Uber and the other app-based transportation during the protests is unlike taxis, their cars arent yellow plated. That means theyre deemed illegal as public transports. However, Uber et al firmly maintained theyre not public transport companies and that their drivers provide a service comparable to private car rentals.
Image viacommons.wikimedia.org
The new regulation came up with the term personal transportation with public vehicles not following a fixed route to solve the predicament. This puts metered taxis and rental cars into the same category neither public transport nor entirely private.
Okay, thats quite a good news.
2. App-based transports cant work with private car owners
This is a major roadblock for Uber, Grab and Go-car in Indonesia. They arent allowed to partner with private car owners, or so-called freelance drivers.
The regulation says app companies that offer tech solutions for personal transportation are obliged to work with drivers from a registered transportation company, like a rental car firm.
Ridzki Kramadibrata, managing director for Grab Indonesia, said in a statement that parts of the new regulation would be a concern for its drivers, but hopes that the government will also listen and consider the aspirations of our driver partners and look for the solution together.
Hope the drivers will eventually be heard.
3. Drivers must organize through rental car companies
Any car owner who wants to drive under one of the app-based transport companies have to align with a rental company as requirements to join. This process requires potential drivers to jump through many hoops to drive with Uber or Grab.
That means, their vehicles papers need to be processed by the rental car company. It must pass a vehicle safety check and have a visible sticker on the exterior. It also needs to display a customer hotline number inside.
Then theres another set of rules car rental companies need to fulfill. For example, they must have a fleet of at least five vehicles. They also must have a carpool and garage.
As we may know, Uber is currently undergoing this rule within their internal working system, but in a much simpler way, without any customer hotline number, stickers, car pool and so on.
As usual, the govt tends to turn simple things into complicated jobs.
4. The app-companies cant recruit drivers
It is another potential issue for Uber and its competitors: according to the new regulation, ride-hailing apps are not allowed to recruit drivers. That could mean no more ads or recruitment events.
The startups would need to use a car rental company as a proxy for recruitment, another significant complication in their driver onboarding process. Bad news for car owners who invested their money on new cars intended for Uber.
5. The app companies cant set fares
Image viathedailybeast.com
Okay, its getting worse. Now the regulation said that the transportation app companies are also no longer allowed to set their own fares and driver compensation. That means, Uber and Grab customers (most of us, we think), for the comfortable ride-hailing cars, may have to pay more expensive than they used to pay.
Uber and Grab cant just do whatever they want here, said Pudji Hartanto Iskandar, general director of land transportation at the Transportation Ministry.
As we may know (again), Ubers (and its fellows) major benefits are customers can enjoy their rides in decent new cars, with nice drivers, at a reasonable and equitable fare (compared to current taxi fares).
6. The startups must disclose data of drivers and cars
The app-based transportation startups will be required to report data to the ministry of transportation. They will have to disclose the names of all car rental companies they work with, as well as information about the cars and drivers in their network.
7. Motorbikes remain unregulated
Image vialagi.online
The regulation makes no mention of two-wheels app-based transportation, which means motorcycle-based transportation remains unregulated. That leaves UberMotor, GrabBike, and Go-Jek safe for now.
The strategy
As cited from Tech in Asia, Uber and its competitors need to cultivate a strong bond with the rental car industry in Indonesia or even create entities which they can control.
Uber has already formed a partnership with a car-rental cooperative. According to the Wall Street Journal, drivers of GrabCar, the car-hailing service of GrabTaxi, formed a cooperative last month called the Indonesian Car Rental Cooperative (PPRI). This legal entity serves as the base through which Grab drivers can sign up.
None of these parts of regulation will be enforced immediately. The decree released to the public this week will take effect in roughly six months.
Instead of turning simple things into complicated, bureaucratic and error-prone systems, lets hope the government will eventually reach a mutual agreement with these life-saving app-based transportation startups.
