The revised version of Ministerial Regulation No. 32/2016 is expected to be a game changer for app-based ride-sharing services. (Photo courtesy of Grab)

5 Things You Need to Know About the New Ride-Sharing Services Rule


MARCH 25, 2017

Jakarta. The revised Ministerial Regulation No. 32/2016 is expected to be a game changer for app-based ride-sharing services. The regulation had been in place since May last year, but the Ministry of Transportation felt the need to revise it last month after a series of at times violent clashes between the drivers of conventional transportation services and the so-called "driver partners" of the app-based services in Tangerang, Bogor and Solo.

Communications and Information Minister Rudiantara said the revisions will favor online transportation companies and show that the government always values technological innovations. He also said that the new rule will ensure convenience and safety not just for both online and conventional transportation companies, but also for their customers.


Instead of overreacting on unconfirmed changes to the rule being shared around on social media, you'd do well to take note of the following key changes brought about by the revisions.

1. "Car Rental Services" no more

Previously, Go-jek, Uber, and Grab were recognized as car rental services, but now they are a unique kind of public transportation operating without fixed routes.

What does this mean? By classifying ride-sharing services as public transportation, the government now has the authority to set certain standards in terms of fares, taxes, fleet size and salary rates for drivers.

Ride-sharing companies have to open repair shops and pools for their cars or motorbikes to wait for passengers. Hanging out on street corners looking for passengers will no longer be allowed.

2. More standard requirements for vehicles

It's easy to become a driver partner for an app-based ride-sharing service. You just have to sign up with your vehicle of choice, either privately owned or rented, along with other necessary documents such as a driver's license.

After the new rule is implemented, you will have to transfer your vehicle ownership to a co-operative. The vehicle must meet the minimum engine displacement requirement (1,000 cc) and has been issued with a roadworthiness certificate (KIR) to improve passenger safety.

3. Fleet quota

The new rule will limit the number of vehicles operating in each company. The Transportation Minister said this rule is meant to avoid oversupply, which can greatly reduce income for drivers. Companies are also required to provide regular reports on the size of their fleet.

4. Fare caps

To encourage healthier competition between online and conventional transportation services, app-based ride-sharing services are no longer allowed to set fares or increase them during peak hours.

The Transportation Ministry has been announcing the main points of the revised regulation on their official Twitter account and has said that the floor and ceiling prices on ride-sharing services will be determined by the governor of the province where the service is being rendered. In Jakarta, the governor will be assisted by the head of the Greater Jakarta Transportation Agency (BPTJ).

This particular policy has sparked many complaints on social media as people are worried they will have to start paying more for Uber, Grab or Go-jek. However, these companies will still be allowed to offer promo deals that will close the gap between the current and former fares.

5. You'll start feeling the changes next month

The revised regulation will start being implemented unexpectedly soon, on April 1. That will kickstart a six-month "trial period" in which the government will monitor how the rule is working — or not working — before revisiting it.

Some think the revisions to the rule are long overdue, arguing that the original regulation should have carried the detailed stipulations that only just came out now.

On the other hand, lawmakers have been heavily criticized for rushing the new regulation, cowed by recent incidents.

Did they conduct customer surveys to find out what they want? Were useful innovations brought about by app-based ride-sharing services taken into account when they revised the law?

A big question mark is also on whether the public — including the companies, driver partners and customers — is ready for a host of major changes with barely a week to prepare for them.

The good news is, if you feel like you have something to say, if you care about having an effective system of law, you still have time to voice your opinion.

Ride-sharing service Grab has invited you to share your thoughts on social media by using the hashtag #JANGANMUNDUR. It has a double meaning: "Don't go backwards" — showing support for more innovations in the transportation industry — and "Don't back down" — arguing that it's too early to stop the flow of technological innovations and also customer aspirations for convenient and low-cost transportation services.

If you care about keeping that leeway for more innovations and still think the government should provide more room for discussion on the new regulation, speak out and don't forget to include the hashtag.

This article is brought to you by Grab