Uber and Grab must get local partners, says Indonesia after protests

Indonesian taxi drivers listening as their union leaders delivered speeches amid a protest against Uber and other ride-hailing app services outside the Parliament building in Jakarta on Tuesday.
Indonesian taxi drivers listening as their union leaders delivered speeches amid a protest against Uber and other ride-hailing app services outside the Parliament building in Jakarta on Tuesday.PHOTO: AGENCE FRANCE-PRESSE

JAKARTA • Indonesia has ordered ride-hailing app companies Uber and Grab to partner local transport businesses and register their cars by the end of May, after taxi drivers staged a violent protest.

There were scenes of chaos at a demonstration in the capital Jakarta on Tuesday, with thousands of traditional taxi drivers blocking major roads, fighting with rivals and demanding that the government ban taxi-hailing apps.

The Transport Ministry said cars working for the app firms must register and team up with a local partner by May 31 or face a ban.

"It's in line with a government regulation from 2009 that says all public transport needs to be a legal entity, register and work together with legal taxi businesses," said ministry spokesman Julius Adravida Barata on Thursday, as quoted by Agence France-Presse.

American firm Uber and South- east Asian outfit Grab are hugely popular in traffic-clogged Jakarta.

Grab's Indonesian unit said it was already working with an Indonesian partner. "Grab is now trying to ensure that our partner can and will follow every requirement from the government," said the unit's managing director Ridzki Kramadibrata.

There was no immediate comment from Uber.

Anger has been growing among taxi drivers worldwide at the challenge presented by Uber and other app-based services that typically offer cheaper fares than traditional transport operators.

The May 31 deadline was set at a meeting at the Coordinating Ministry of Political, Legal and Security Affairs on Thursday, which discussed the final solution on the legality of app-based public transport, Tempo online news reported.

Mr Barata said Uber and Grab have two choices: remain as content providers or become public transport operators.

The decision from the meeting means Uber and Grab have to cooperate with public transport operators that are legal entities - in this case, cooperatives - Tempo said. The cooperatives must then register their vehicles, carry out roadworthiness tests and meet other regulations.

A version of this article appeared in the print edition of The Straits Times on March 26, 2016, with the headline 'Uber and Grab must get local partners, says Indonesia after protests'. Print Edition | Subscribe