1. Setback for Ola, Uber over surge pricing as HC hands power of regulation to Karnataka govt

Setback for Ola, Uber over surge pricing as HC hands power of regulation to Karnataka govt

The Karnataka High Court on Thursday upheld the state government's move to regulate surge pricing of cab aggregators like Uber and Ola. Uber, in its petition, had contested the Karnataka On-demand Transportation Technology Rules, 2016, on the need for permits and surge price curbs.

By: | Bengaluru | Published: November 11, 2016 6:26 AM

The Karnataka High Court on Thursday upheld the state government’s move to regulate surge pricing of cab aggregators like Uber and Ola. Uber, in its petition, had contested the Karnataka On-demand Transportation Technology Rules, 2016, on the need for permits and surge price curbs.

The Karnataka government as part of its new rules in April had mandated the cab aggregators to get a permit before they start their operations. Uber had contested this regulation in June though its rival Ola secured a licence. The High Court said that the State government had the rights to frame such rules and upheld certain provisions contested by Uber which also the one that mandated that drivers should be residents of Karnataka for at least two years and possess working knowledge of Kannada language. Uber has now been given a month’s time to comply with this direction and also procure a licence to ensure its operations.

On the issue of surge pricing, the High Court has maintained the fares cannot exceed beyond the cap of R19.50 per km. The court also maintained that a criminal complaint filed against a driver is no ground to cancel the aggregator’s licence.

The Karnataka On-demand Transportation Technology Aggregators Rule, 2016, which was notified on 2 April, said that ride hailing services are required to obtain a licence under the rules to operate in the state, especially Bengaluru. However, Ola and the Radio Taxi Operators Association with members such as Meru Cabs have supported the government rules, while Uber, which opposes the new rules has called it anti-constitutional.

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