After two months of the cabinet approving a bill to regulate owners of private cars working with private companies, such as the Uber and Careem, no information has been given to the companies or their drivers about what the situation would look like for their services under the expected new regulations.
Uber and Careem, both mobile application-based taxi services, provide a modern way of commuting by allowing the rider to order a car directly to their location through GPS. The applications even tell you how long the driver will take to reach your location and estimate the fare and arrival time.
In November, the cabinet approved a bill to regulate the work of private car owners with private companies Uber and Careem using information technology, with the of aim of protecting the rights of passengers and drivers. Parliament has not yet received the bill.
When contacted, head of parliament’s transportation committee, Saeed Taaema, said, “it is too early to speak about the law and parliament did not receive it and I have no idea about it or even when it will be sent.”
The bill that is drafted by the government is pending approval and its provisions are yet to be published, but what is commonly known about it is that it will provide companies a six-month time limit to adjust their conditions in accordance with certain terms.
General Manager of Uber Egypt Abdel Latif Waked spoke to Daily News Egypt about the bill and what Uber is doing in preparation to handle the consequences expected after the bill’s enforcement.
“We have been working with ministers to finalise world-class regulations and the draft law is currently in the State Council. It is key that they are forward looking and beneficial for the entire industry, allowing companies to further grow and scale, and allow for part-time, flexible work and continued investment in Egypt,” he said.
There are a few points in the draft regulations that will affect the livelihood of drivers, making it difficult to support part-time work, he added.
Car owners are supposed to add taxi number plates, change their private licenses to commercial ones, and no drivers would be allowed to drive the cars expect their owners, and finally, they should obtain a tax card and commercial registration. Companies will be exposed to a fine of EGP 10,000-50,000 in case they fail to meet the terms. Also, the number of working hours will be set to seven hours per day.
The terms will impose a state of uncertainty for drivers’ conditions, which will lead them to pay more money in the form of taxes and insurance to the government, impact their income received from the service, and will change them from private drivers to being treated as normal taxi drivers, which is something they do not prefer.
Waked commented on the terms, saying firstly that requesting high licensing fees from drivers will reduce the amount of drivers working for Uber and the ability of potential drivers to join Uber, which will affect the scope of employment in Egypt.
He further added that only the owner of the vehicle being allowed to drive it will make it very hard for drivers to work, as more than half of drivers at Uber are non-owners of vehicles. “Drivers can set their own schedule hour by hour, day by day, and week by week. Drivers can tend to childcare, invest in their education or work another job, driving only when they need or want—even if that is just to pay an unexpected bill or rent between jobs and we want regulations that will help maintain this,” he said.
With regards to data sharing, he said, “the privacy of our users—both riders and drivers—is of top importance and we will always work to protect their privacy. We have not provided any government with real-time access to rider data and we believe that regulation must not require data submission that could allow a rider or driver’s privacy to be compromised.”
Regarding the obstacles facing drivers as a result of the application of regulations, Waked said, “over 150,000 drivers gave a ride in 2017 and our numbers are increasing drastically on a yearly basis, and that is why we strive to provide drivers with the most convenient environment to enable growth and increase the rate of job opportunities in Egypt. Obstacles affecting livelihood of drivers in regulations mainly consist of the high licensing fee and vehicle ownership. As high licensing fee will be an issue for many drivers as they will not be able to attain it so we aim to reduce the fee to provide them with a profitable platform. In addition, vehicle ownership is one of the main issues that needs to be resolved, as this will limit the source of income of drivers joining the Uber platform and decrease investment opportunities.”
As for Uber’s plan to overcome these challenges, Waked said that to be able to continue investing in Egypt, Uber believes in progressive regulations that will support flexible, part-time work. “We believe this will allow more people to benefit from the Uber technology and this will allow us to scale”, he said.
“Ideal regulations are ones that will allow for flexible, part-time work opportunities and unlock the full benefits of ridesharing for riders, drivers, and cities in Egypt. We will strive to reach an agreement with the government to reach an ultimate plan that serves the needs of all stakeholders involved in the Uber platform. Uber is committed to empowering the Egyptian economy by creating many job opportunities and investing in Egypt and in order to continue this, we need regulations that preserve Uber’s code of conduct,” the GM concluded.
In a phone interview with a driver, who preferred to speak on condition of anonymity, he commented on the terms saying that the he rejects that his car could be categorised as taxi, because he is working on a part-time basis and also uses his car for personal purposes.
Buying cars is not something affordable with higher prices that came following fuel price hikes. These terms are somehow seen as restrictions to the drivers who decided to join the service to improve their income.
A driver and car owner, who works with both Uber and Careem, told Daily News Egypt, “I am personally not worried about being the only driver of the car, but I believe that others will be highly impacted, since a large number of youth have been working with the application for additional income and do not have cars.”
Only allowing the car owners to drive the cars will prohibit other drivers from joining the application, as many of those who joined the service wanted to improve their income and will be forced to leave it. A large number of the drivers for the apps are not the owners of the cars they drive and thus many will be forced to leave the jobs.
“The worst thing about the service so far is that we are still unable to work freely because our work is illegal in the eyes of the traffic police,” the 35-year-old driver said, adding that he does not mind paying taxes or insurance if it means getting registered adding that what really concerns him is working legally and avoid being stopped by a traffic police officer.
Since there is no legal framework for the drivers, when traffic police can identify that a driver is working for Uber or Careem, they could be stopped and have their car and license withdrawn, on accusations of using a private vehicle for commercial purposes, and will be required to pay a fine of EGP 3,000.
After speaking to several drivers on how they handle such situations, they said that bribes are a practical way to ditch harassment by traffic officers.
The drivers working for such companies have technically been working illegally for over two years so far, as they continue to await state recognition, which is expected to be granted after the bill’s enforcement. However, though the drivers are exposed to harassment by traffic police, the companies themselves have the legal right to work and have held several meetings with the government.
Many passengers have decided to switch to Uber and Careem as an alternative to traditional Cairo white taxis. After drivers working with these private companies increased, white taxis organised and protested against Uber and Careem, accusing them of unfair competition and operating illegally.
Taking a ride with a regular taxi driver can often be inconvenient, as many drivers turn away customers if their destination is far away, the route is busy, or even simply because it is inconvenient for them. Even though white taxis are provided with a metre, many drivers intentionally say it is broken, in an effort to extract a higher fare from customers.
The ride-hailing company Uber has decided to amend its base fare, following the hike in fuel prices at the end of June. According to the new prices, the base fare was increased to EGP 6 for UberX and EGP 7 for Uber Select.
The company also increased the rate per kilometre to EGP 1.85 for UberX and EGP 2 for Uber Select. The per minute rate in traffic was set at EGP 0.25 for UberX and EGP 0.4 for Uber Select. The minimum fare was set at EGP 10 and EGP 15 for both services, respectively. The price used by Uber is calculated based on multiplying the distance by the waiting time.
Careem has also adjusted its prices, changing its base fare for its Go service to EGP 5.5, while the price per kilometre was set to EGP 2.21 and traffic time to EGP 46 per hour. The minimum trip cost became EGP 12, up from EGP 10.
In a previous press conference, Social Solidarity Minister Ghada Waly said there will be fees for such companies, including taxes and insurance for passengers, adding that the law comes to protect the customers and the drivers. She said that the new rules would also set working hours for the drivers while not allowing anyone other than the car owner to drive it, noting that parties were consulted based on the experiences of several countries in the world that have applied similar laws.
She stressed that these terms are to protect white taxi drivers and to adjust the conditions of companies operating in the system of passenger transport through private companies such as Uber and Careem.
In a similar context, Transportation Minister Hisham Arafat said the new law would provide additional income for car owners and reduce gasoline consumption by allowing more than one passenger to take the same route.
He also added during a press conference that the ministry will announce the technical specifications of vehicles used to transport more than one person inside the vehicles, and the Ministry of Interior will issue operating licenses.