App-based auto ban: Karnataka HC allows govt, cos more time to conclude on commission charges

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The Karnataka High Court on November 7 allowed the transport department and the app-based auto aggregators Ola and Uber to take four more weeks to discuss and conclude on fixing the convenience fee.

This comes as an extension time given by the Court, which had previously given 15 days time to the state government, regulators, and cab aggregators to work out a fair pricing mechanism.

“We have submitted our proposal to the Hon’ble High Court and the companies have submitted their report. However, the issue is more complicated and needs more time to come up with fair pricing,” said a source from the Karnataka Transport Department requesting anonymity.
The High Court bench headed by Justice M.G.S. Kamal said the four weeks will be granted and asked the government to submit objections if any, for yet another interim petition filed by Ola and Uber for charging more convenience fees for auto services.

The Karnataka Transport Department and representatives of ride-hailing firms Ola, Uber, and Rapido met on October 31st to come up with a consensus on fixing the commission. However, the representatives and authorities failed to reach a common ground on fixing the convenience fee levied on operating autorickshaws.

During the meeting held on Saturday, the companies argued to fix the convenience fee at 25 percent of the base fare, while the Karnataka Transport Department stressed on continuing the court-fixed temporary rate of 10 percent. Earlier, the companies were charging a flat rate of Rs 40 per ride as a convenience fee.

In fact, In a statement, Uber said that it may have to limit the auto services in some parts of Bengaluru as running the business may turn unviable due to the High Court’s temporary orders to cap the commission charged by the aggregator at 10 percent.

Amidst the issues between the ride-hailing firms and the transport department, Bengaluru Auto Rickshaw Driver's Union (ARDU) has come up with its own transport app and launched a beta version with the objective to charge fair prices to take on rivals like Ola, Uber, and Rapido.

Talking about the new app, a source from the Karnataka Transport Department said that even the new apps will have to adhere to the high court’s order of charging only 10 percent and the transport department will keep a check on the new app as well.