Ride hailing services Ola and Uber Inc. could see services in the state of Karnataka brought to a halt following a new regulation by the State Transport Department.
Even as the two taxi hailing services have immediately suspended surge pricing from April 18, 2016, they could see services bring halted in what is seen as one of their largest markets as per statement issued on Saturday.
Under Karnataka On-demand Transportation Technology Aggregator Rules 2016, both these taxi operators will be required to hold effective license issued under these rules. This regulation issued by the Commissioner of Transport has caused much difficulty for the two taxi operators who will either have to comply with this new regulation immediately or will have to stop operations in the state.
The statement issued by the authorities states that not obtaining licenses is a violation Sec-93 r/w 193 of Motor Vehicles Act and non receipt of these licenses will invite strict action against violators.
Getting a license would bring to an end surge prices while operators will have to comply with minimum fares as laid down by the Government from time to time. Prominent business leader and Chairman of Aarin Capital, Mr T V Mohandas Pai stated that while these new requisites were reasonable, the Government should not stop the business in the state as this would bring a bad name to both Ola and Uber.