Ride-Hailing Apps Law Out

Parliament has finally issued the hotly-debated Law No. 87 of 2018 Regulating Land Transportation Services Using Information Technology,[1] which governs all land transportation services offered through technology via privately owned vehicles. Companies offering such services have six months to comply with the law, and a "compliance fee" equivalent to the annual license fee will be levied for this grace period, up to EGP 6 million.  A short law, it provides only a skeletal outline of the regulation, leaving broad discretion to sub-legislation. It does not define "private vehicle” but does define a mass transportation vehicle as one that does not travel on fixed routes and can carry more than seven passengers. The service in question is defined as the provision of transportation service via a computer program or application to offer or conclude the transportation agreement, thereby conceivably extending the application of the law to any two parties arranging travel via any messaging application, thus treating small businesses using WhatsApp the same as Uber or Careem. Companies owning the ride-hailing platform, vehicles offering the service, and drivers must each have a separate license or permit to offer the service, and vehicles must be clearly marked as licensed to offer the service. Companies offering the service will pay a license fee of up to EGP 30 million for each five-year period, depending on the number and type of vehicles in the fleet, a quarter of which must be paid at the beginning of the license period. The vehicle license fee and the driver license fee are a maximum of EGP 1000 per year, and vehicles are also liable for paying the usual private vehicle registration fees, possibly with a 25% mark up. The law requires licensed companies to provide security agencies – or any government body with jurisdiction - with full access to all the data of all users, complete with all relevant technical equipment, programs and systems, at their immediate request and to allow this access for 180 continuous days without judicial scrutiny at any stage but has permitted companies to maintain the privacy of their users, other than from the state. Refusal to comply will attract a penalty ranging between EGP 500 and EGP 5 million and revocation of the license, without any thresholds set for number or severity of violations. Unlike in other jurisdictions, the law does not address the labour law concerns of the drivers, and no labour rights are extended to them other than social insurance, for which companies and drivers are now both liable in a manner akin to that of employers and employees. The grievances of white taxi drivers were somewhat addressed by the stipulation that licensed companies must present a plan for incorporating licensed taxis into their service within three months of obtaining their license, but they are not compensated for the loss in value of their existing licenses, and if they wish to obtain a ride-hailing permit, must pay all the relevant fees. Neither the companies nor the drivers are required to obtain insurance to protect drivers, passengers or third parties from road accidents. The penalties present a confusing picture, setting out a fine ranging from EGP 200 to 5 million for unlicensed vehicles or drivers, but not unlicensed companies; further penalties are a fine of up to EGP 20,000 for an unlicensed driver or car, an unmarked car, or any other violation of the forthcoming regulations, to be doubled for recidivism within 6 months. All penalties are borne jointly by any manager who knew of the violation and was negligent in his or her duties.   [1] Law No. 87/2018 Regulating Land Transportation Services Using Information Technology, Official Gazette, Issue No. 23 (bis) (a), 11 June 2018.