The Bagmati province government is in the final stages of introducing a legal framework for app-based ride-sharing services, seven years after their introduction in Kathmandu, Nepal’s capital.The Ministry of Labour, Employment, and Transport’s Bagmati province secretary, Balram Niraula, confirmed that the draft Ride-Sharing Guidelines have been finalized and will soon be submitted to the relevant ministries for approval. It is expected that the procedure would be finished in a month.
The event is being held in preparation of the beginning of the Nepal Investment Summit on April 21 in an effort to showcase Nepal as a destination that welcomes investments. The launch of ride-sharing applications in 2017 brought about an enormous change in the transportation landscape by offering an easy way of navigating the chaotic roads of the Kathmandu Valley. Thousands of people, especially young people, have benefited from these services by finding jobs, despite reports of harassment and tax cheating.
According to government reports, despite generating substantial revenues, ride-hailing companies have operated informally, without registration or tax payments. The proposed guidelines aim to address these issues by mandating vehicle registration, annual renewal of operations, regulation of fares, and mandatory insurance for passengers.
Previously, ride-hailing services faced government crackdowns, but public pressure led to a reversal of these actions. In 2020, the Patan High Court ordered the regulation of ride-hailing services, and Bagmati province declared them legal in June 2022. However, the absence of guidelines or policies created ambiguity in their operation.
The current Motor Vehicles and Transport Management Act prohibits the use of privately registered vehicles for public transportation, posing a challenge to ride-sharing services. Additionally, foreign-operated ride-hailing apps require separate legal considerations.
Despite the provision of passenger insurance in the law, ride-hailing companies have been illegally charging additional fees per ride, amounting to significant revenue. Furthermore, the rise of offline ride-hailing poses risks for passengers, prompting police action against unauthorized operations.
The impending introduction of Ride-Sharing Guidelines in Bagmati province signals a significant step towards regulating and formalizing the operation of app-based ride-sharing services in Nepal.
