Uber Indonesia Raises Concern Over New Ridesharing Regulation

Uber Indonesia, the local arm of the San Francisco-based ride-hailing service, raised concerns over the government's new regulation on ridesharing. (Reuters Photo/Toby Melville)

By : Tabita Diela | on 9:28 PM July 05, 2017
Category : Business, Corporate News, Featured

Jakarta. Uber Indonesia, the local arm of the San Francisco-based ride-hailing service, raised concerns over the government's new regulation on ridesharing.

"Indonesia is a country known for its openness to global economic trends, new technologies and supporting the people-oriented economy," Uber said on its website on Tuesday (04/07).

"But the rules revision will make Indonesia unable to reap the full benefits from the business model and ridesharing innovation."

Uber referred to a Ministry of Transportation initiative to regulate public transportation services that operate without fixed routes. This includes a cap on tariffs for online ride-hailing companies, maximum fleet sizes, car ownership requirements and access to each service's real-time data.

Ridesharing systems arrived in Indonesia in 2014, providing city dwellers with reliable, comfortable and affordable transport alternatives. The system also provides thousands of job opportunities.

Passengers can save as much as 65 percent of their usual transport costs and 38 percent of the usual wait time by using Uber, according to research by the ride-hailing service and AlphaBeta.

Other ride-hailing services also claim to reduce pollution and traffic congestion. Similar research found that 6 percent of passengers have stopped using their own vehicles, while 62 percent started to use their own vehicles less often.

"Everything was done without burdening the state budget," Uber said.

Despite a decline, Indonesia is still struggling with unemployment. According to the Central Statistics Agency (BPS), 7.01 million of the country's workforce of 131.55 million people did not have jobs in February, representing an unemployment rate of 5.3 percent, compared with 5.6 percent in August 2016 and 5.5 percent in February 2016.

"Fleet quotas, tariff capping and difficult requirements – such as vehicle ownership – limit the access of people who want to share their rides or to an affordable and comfortable service," the statement said.

According to Uber, the requirement to put stickers or the driver's identification on cars is no longer relevant.

"We use technology to improve safety before, during and after the trip that was impossible to do before the smartphone era," Uber said.

Uber also raised concern over the government's demand for access to each ride-hailing service company's real-time data, arguing that such access can breach Uber user's right to privacy.

"We are committed to cooperate with the players in the industry and the government to look for ways that allow tech companies like us change people's lives for the better," Uber said.

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