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Updated: Ola’s Karnataka aggregator license reinstated after being cancelled for running bike taxis in Bangalore

Update, 25 March:

12:45 PM: Ola’s official statement to MediaNama:

“We are glad that the issue stands resolved and we regret any inconvenience caused to our driver-partners and passengers since Friday. We look forward to continue working with the State, to help address the challenges of mobility. We are committed to creating and enhancing livelihood opportunities for millions of driver-partners in the time to come.”

10:30 AM: Karnataka’s transport department will reinstate Ola’s license in the state after it pays a fee to the department, reports the Economic Times. The department is yet to decide the fee, and if it doesn’t, ‘the department will act as per the law,’ the report quoted transport commissioner VP Ikkeri as saying.

The license reinstatement was possible after the state’s CM revoked the suspension. On Friday, Ola’s license was seized for running bike taxis under an aggregator license. However, Ola had 3 days to submit its license after receiving the notice. According to a TOI report, the state transport department had not implemented the ban on Ola yet, because it had been given time to submit its license. Ola’s present license is valid till 19 June 2021.

In Karnataka, Ola’s cabs operate in Bangalore, Mysore, Mangalore, Hubballi, Ballari, Belgaum and Kalaburagi.

With both, the revoking and reinstatement of the license, multiple questions remain unanswered:

  • If Ola and the state government were already in talks as Ola says, why was Ola’s license suspended for 6 months? On what basis was it reinstated?
  • Why was Ola running the bike taxi service despite being asked to stop?
  • Were Ola’s cabs running in Bangalore during the ban?
  • How/what did Ola communicate to its drivers and users, if anything?

*
Previously, 22 March: The State Transport Department of Karnataka has cancelled Ola’s aggregator license for 6 months, for plying bike taxis under the same license, TheNewsMinute reported. (hat tip: Sharath Kalagaru)

Tanveer Pasha, President of Ola, Taxiforsure and Uber drivers and Owners Association, told MediaNama that Ola was violating the state’s laws by running commercial and non-commercial bike taxis in the state. A copy of the department’s order can be seen here. Ola cannot run any vehicles on its platform, as per the notice.

Ola told MediaNama that the notification was “unfortunate and that we look forward to an opportunity to address these concerns directly with state officials to find a solution for our driver-partners and millions of Ola users in Karnataka.” (The full statement at the bottom)

According to the TNM report, Ola has to submit its license within 3 days from today (when it received the order). Booking an Ola from today would be illegal, the Joint Commissioner of Transport told the publication. The order issued to Ola read that “According to section 11 (1) The Karnataka On Demand Transportation Technology Aggregators Rules 2016, the Transport Department can decide to cancel the license of the cab aggregator as there is a violation of rules.”

The report states that Rapido, another bike taxi service, was also sent the same notice for operating bike taxis in the city. It’s unclear which license Rapido was operating under.

Bikes seized, notice to stop bike taxi services

Last month, the Bangalore Transport Department asked Ola to stop offering its bike taxi services in Bangalore, and seize them if found operating, due to the lack of a policy for bike taxis. According to a Hindu report, the department had already seized around 200 Ola and Rapido bikes after officers posed as customers, apparently booking cases against the operators and fining them Rs 2,000. Note that the seizing of vehicles has happened in 2017 as well.

Last August, the transport department said that it was looking into the concept of bike taxis and whether they could be feasible in the city. It cited women’s safety and the safety of passengers as its concerns.

The inconsistent regulation of bike taxis in India

Bike taxis are illegal in the state, there are no regulations looking at their legality and apparently, the Transport Department is working on a policy with stakeholders to decide whether bike taxis can be allowed in the city, if not the state.

However, it is also unclear as to what licenses and permits bike taxis need to operate, precisely given the lack of regulation. Bike taxis would need to be commercially insured and pliable vehicles with yellow number plates, regulations for safety, etc.

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Only Goa and Haryana allow bike taxis so far. According to a Quartz report, Telangana, Rajasthan, and Uttar Pradesh started authorising commercial bike taxis since December 2017. In December last year, the Ministry of Road Transport and Highways told the Karnataka state government that it was free to regulate bike taxi services. Also, a state-appointed committee was to submit its report on the feasibility of bike taxis in the city to the government in November 2018, but it doesn’t seem that that has happened yet.

*

Ola’s full statement:

“Ola is a law-abiding company that has always worked with the Government to develop livelihoods, improve mobility, and enable a new technology industry. We are evaluating all options to find an amicable solution wherein hundreds of thousands of driver-partners in the state of Karnataka can continue to work and serve the mobility needs of our citizens.

We have been closely working with the authorities on this topic, responding to queries and making proactive representations to the ministry. Despite other companies continuing to operate illegally, we halted our bike taxi experiment weeks ago. Instead we sought the state’s cooperation to develop a legal framework for a pilot that will continue to take advantage of emerging opportunities in the mobility economy.

This notification is unfortunate, and we look forward to an opportunity to address these concerns directly with state officials to find a solution for our driver-partners and millions of Ola users in Karnataka.”

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Written By

I'm a MediaNama alumna from 2015-16 (remember TinyOwl?) now back to cover e-services like food and grocery delivery, app based transport and policies, platforms and media in India.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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