Uber and Bolt face regulatory concerns in Abuja, where council officials have tightened the reins on drivers
Uber and Bolt face regulatory concerns in Abuja, where council officials have tightened the reins on drivers
Throughout the world, innovation always takes precedence over regulation. Typically, it is only a matter of time before regulation catches up. Regulators are catching up with taxi-hailing businesses in Abuja, such as Bolt and Uber, at a breakneck pace, wreaking havoc.
Similarly to Lagos, where officers of the Vehicle Inspection Service (VIS) harassed e-hailing drivers, officials of the Municipal Area Council's (AMAC) revenue task force are cracking down hard on the drivers in Abuja. Their tactics are identical: officers arrange for a ride to entice a driver before arresting him and requiring him to pay a fine.
Additionally, the drivers used the same strategy to identify and harass fellow drivers who refused to participate in a week-long boycott of the Uber and Bolt apps earlier this year in Lagos.
However, while the Lagos crackdown appeared to be a ploy aimed at bringing e-hailing companies to the regulatory table, the Abuja situation has thus far been aimed at subjecting the companies (or their drivers) to a tax. In essence, the AMAC does not appear to be interested in formally regulating Uber or Bolt other than to ensure they pay taxes.
However, similar to the Lagos situation, the drivers have been made to bear the brunt of the punishment.
How it began: the backstory
Uber and Bolt have operated in Abuja for over two years. Throughout that time period, similar to Lagos, ride-hailing companies operated largely free of restrictions and obligations. However, all of that has changed this year.
With the growing popularity of e-hailing as a more secure and dignified mode of public transportation in the city, and with an increasing number of drivers signing up for the apps, the Abuja Municipal Area Council determined that the industry has grown large enough to contribute to the municipality's revenue.
According to findings, the council notified Uber and Bolt about the requirement to pay taxes as early as 2019. However, it did not begin enforcing the demand until June 2021.
It is unclear whether the council issued an enforcement notice to the drivers prior to cracking down hard on them or if it initiated the clampdown prior to issuing the notice. What we can confirm is that the AMAC sent an enforcement notice to Uber on June 18 requesting that they work with their drivers to avoid embarrassment.
The council then began pursuing Uber drivers. The crackdown compelled drivers to respond to AMAC on June 24 via the National Union of Professional App-based Transport Workers (NUPA-BTW).
Comrade Ibrahim Ayoade, chairman of NUPA-BTW and director of the International Alliance of App-based Transport Workers (IAATW), stated in a letter obtained by Technext that the council's attempt to tax drivers amounts to double taxation because they already pay a 25% commission to e-hailing companies that includes tax.
Additionally, the drivers cautioned the council about its operatives' methods, insisting that they are similar to those used by criminals and could endanger the drivers' lives.
Big tech, bigger responsibility
Never was technology intended to exist in a vacuum. No matter how unpredictable or arbitrary any technology may be, because it was designed for human use, it is only a matter of time before governments figure out a way to regulate it.
And this way could be quite mild, such as the Securities and Exchange Commission (SEC) regulating the digital investment space, or quite severe, such as Lagos shutting down the bike-hailing industry. Numerous technology players have argued that innovators should ensure that regulations are in place before fully entering any space.
It is thus heartbreaking to see a replay of the Lagos situation from last year in Abuja this year. It appears as though some of the world's largest technology companies lack the will to take on significant responsibilities. And in this case, the drivers assert that Uber requested payment directly from them from the Abuja Municipal Council as early as 2019. (drivers).
Drivers refusal and Uber’s compromise
However, the drivers' union is sticking to its guns and blaming ride-hailing companies entirely for this incident.
The drivers asserted in a letter to Uber General Manager for West Africa, Lola Kassim, that they have found themselves in this unfortunate situation as a result of the company's "refusal or inability to resolve revenue issues with AMAC."
“We maintain our position that payment of revenue to AMAC is squarely your organization's responsibility, given that you deduct 25% from each trip made by drivers. We therefore demand that the dispute between Uber and AMAC be resolved expeditiously so that app-based drivers can resume driving without fear of harassment by the revenue task force,” the letter reads in part.
Uber has also responded to drivers on its Abuja platform, assuring them that a team is working to expedite the process. Meanwhile, Uber says it is willing to reimburse drivers who are impounded or fined.
It is unknown whether any driver has been reimbursed successfully. Additionally, it is unclear what Bolt is doing to assist its Abuja drivers.
As was the case in Lagos, the Abuja Municipal Area Council appears uninterested in formal regulation. Thus far, it has been entirely a revenue-generating exercise, as the council has made abundantly clear. However, this does not mean that regulation is beyond its purview.
As more Abuja residents opt for ride-hailing, some form of regulation may eventually be necessary for the benefit of all parties.
