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Shanghai govt cracks down on taxi booking apps

Published on Feb 27, 2014 9:43 AM

SHANGHAI (REUTERS) - The Shanghai city government has followed Beijing's lead and moved to restrict the usage of increasingly popular taxi booking apps, putting investments into the technology by foreign and Chinese companies at risk.

Taxi booking apps essentially allow customers and drivers to cooperate to break through government price controls on fares to negotiate a market price for transportation.

The apps usually allow users to bid for cabs by adding an additional flat fare but they do so at the expense of cab companies that provide dispatch services to the cabbies.

It has also resulted in complaints that Shanghai passengers are having increasing difficulty hailing cabs on the street, because many refuse to pick up customers paying normal fares.

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