Pilot scheme for ride-hailing services to officially stop on April 1

February 18, 2020 | 18:47
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The Ministry of Transport has issued a decision to end the pilot programme for the application of technology in managing and connecting electronic contract-based passenger transportation from April 1.
pilot scheme for ride hailing services to officially stop on april 1
Pilot scheme for ride-hailing services to officially stop on April 1

The pilot programme on ride-hailing services will officially end after more than two years of implementation. The services will comply with the new regulations stipulated in Decree No.10/2020/ND-CP, replacing Decree No.86/2014/ND-CP.

The new Decree 10, which comes into effect on April 1, stipulates that all firms operating in passenger transportation with cars of fewer than nine seats using ride-hailing applications are to be treated as taxi firms.

According to the MoT, the pilot programme will be suspended to make sure it does not clash with Decree 10. Moreover, the ministry claimed this is a necessary move to control the boom of ride-hailing firms, which are making traffic management increasingly difficult.

The MoT requested municipal Departments of Transport in these cities to inform all ride hailing firms, transport co-operatives, and drivers participating in the pilot programme of its termination.

Furthermore, according to Decree No.10/2020/ND-CP issued by the Prime Minister on January 17, which will also come into effect on April 1, all ride-hailing vehicles have to affix “taxi” signs to the top of their vehicles or taxi badges made of reflective materials on their front and rear windshields.

In case passenger cars with less than nine seats have been given a badge for transportation service before April 1, 2020, they will have to reapply for a new badge and have it installed at the required position before July 1, 2021.

Since the implementation of the pilot programme, Vietnam has become a battleground for local ride-hailing firms like Fastgo, Aber, Vato, Be, and Southeast Asian unicorns Grab and Go-Jek (locally Go-Viet). In particular, Grab has become a heavyweight player in the market, putting pressure on traditional firms.

In June 2017, Vinasun had filed a lawsuit against Grab, claiming that the latter’s illegal activities have caused a slump in its earnings. The prolonged court case between Vinasun and Grab reflects the new competition between traditional taxi operators and ride-hailing firms in Vietnam.

Reacting to the transformed competitive environment, eight traditional taxi companies also launched their own software such as V.Car, Thanh Cong Car, Vic.Car, HomeCar, Mai Linh Car, LB.Car, and Emddi-Phuc Xuyen.

By Thanh Vy

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