N10m license fee, N5m annual renewal, 10% of each trip -Uber, Bolt drivers face uncertain future as Lagos begins new regulations

The Lagos State Ministry of Transportation has released regulatory documents for taxi operators and ride-hailing companies like Uber, Bolt, and several others. These regulations are set to be enforced from August 20, 2020.

 

In March 2020, it was reported that the Lagos State Government was planning to regulate the e-hailing sector. This was two months after its ban on commercial motorcycles (Okada) forced operators like MAX, Gokada, and ORide to cease operations.

 

In that report, we stated that Uber and Bolt drivers are expected to have a Lagos State Drivers’ Institute (LASDRI) card and a driver badge issued by the Department of Public Transport and Commuter Services of the Lagos State Ministry of Transportation.

 

Also, vehicles on ride-hailing platforms must possess a Hackney permit issued by the Lagos State Motor Vehicle Administration Agency and be fitted with a corresponding tag.

 

The document, tagged “Guidelines For On-line HailingBusiness Operation Of Taxi In Lagos State”, now categorises the taxi business operation as follows:

 

a. Service Entity: An app developer like Uber/Bolt that does not operate or own any vehicle, but connects car owners and commuters with their App.

 

b. Taxi and app operators: These are companies like Ekocab that operate their vehicles as well as the App. These companies might have their fleet, and also have third party car/fleet owners on their platform.

 

From August 20, 2020, service entities in the city with less than 1,000 drivers are expected to pay a ₦10 million ($27,341) licence fee, while those with more than 1,000 drivers are to pay ₦25 million ($54,682).

 

Subsequent renewals are pegged at ₦10 million ($27,341) for those with more than 1,000 drivers and ₦5 million ($13,670) for those with less.

 

Taxi and App Operators with 50 cabs or less are expected to pay a ₦5 million ($13,670) licence fee, while those with more than 50 cabs are to pay ₦10 million ($27,341). The former will pay an annual renewal of ₦1.5 million (~$3,870), while the latter will renew at ₦3 million ($7,700).

Other provisions include:

• All Operators of e-Hailing Taxi Services must pay the State Government 10% service tax on each transaction paid by the passengers to the operators.
• They must commence the renewal process 3 (three) months before the expiration of the existing licence
• They must have a quarterly meeting with the Ministry of Transportation for operational updates and feedback
• All operators of e-hailing taxi services must give the Ministry access to their database

Taxicab requirements

The Lagos State Government states that all taxicabs must undergo a thorough inspection according to the State’s Road Traffic Law and under a special Taxicab inspection protocol. A vehicle must meet the following conditions:

• It must be brand new
• Where the vehicle is not new, the vehicle must be within the first three (3) years of its manufacture as specified by the manufacturer
• The capacity of the vehicle must not be less than 1.3cc
• It must have a completed, signed, and dated safety features compliance form prescribed by the Ministry
• The taxicab shall be equipped with a taximeter approved by the Ministry
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 Click to view/download full Lagos guidelines on ride-hailing operations