The commission paid by drivers to digital taxi operators has been capped at 18 per cent per trip as the state moves to protect thousands of workers long inconvenienced by high charges.
The cap will also apply to the commission paid by the owners of the vehicles registered to the various digital taxi companies, according to new rules published by Transport and Infrastructure Cabinet Secretary James Macharia.
“The commission which shall be paid by a transport network driver or a transport network owner to the transport network company, which shall not exceed eighteen per cent of the total earnings of the trip,” the new law says.
The decision follows frequent strikes by drivers, who have decried their fees as extortionate.
Currently, Uber, Bolt and Little platforms charge 25, 20, and 15 per cent of the ride value or fare, respectively.
Growing operating costs
Bolt, formerly Taxify, increased the partner commission fee from 15 per cent to 20 per cent in September 2019 while Little’s corporate service also increased the charges to 19 per cent in 2020 citing growing operating costs.
“A transport network agreement shall not include terms or conditions designed to increase the commission payable by a transport network driver or transport network owner such that it exceeds eighteen percent of the total earnings per trip as required under sub-regulation (2) (g)” the new regulations further say.
The rules exclude entities or firms providing street-hailing taxi cab services, limousines, or other transport services arranged by a method other than through a transport network platform.
“In these Regulations, unless the context otherwise requires—“transport network platform” means a digital platform or any other similar system offered, used or operated by a transport network company and used by persons for the transportation of passengers for compensation by a transport network driver,” the new law said.
Commission caps will favour the taxi partners who have for a long time decried the charges, terming them unsustainable.
Under the new rules, transport companies are required to seek new licences and provide details such as revenue sharing pacts, registration by the Data Commissioner, pricing mechanism between them and subscribers as well as contractors with vehicle owners, among others.
“Each transport network company and transport network vehicle that was in operation before the commencement of these Regulations shall continue to operate for a period of ninety days within [within] which they shall be required to acquire the necessary licenses (sic) provided for under these Regulations,” the new regulations read.