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China’s Ministry of Transportation warns ride-hailing platforms against performing ‘illegal’ operations

Written by Mengyuan Ge Published on   2 mins read

Under adjusted rules, drivers and vehicles that lack ride-hailing permits will be taken offline.

China’s Ministry of Transportation reiterated that ride-hailing operators must compete fairly and operate within legal boundaries, according to a notice issued on Thursday.

The notice stipulates that local transport authorities should strengthen oversight of ride-hailing platforms. From September 9 onwards, platforms are not allowed to recruit unaccredited drivers or add unrecognized vehicles to their fleets. Local officials are also obligated to ensure no drivers or vehicles that lack the proper permits are on the road.

Until now, many cities allowed drivers to provide professional rides even if they hadn’t acquired the relevant licenses. Qualification requirements for becoming a driver of ride-hailing platforms vary from city to city. Generally, the driver must have a good track record with at least three years’ driving experience. Some local authorities mandate attendance in training sessions that lead up to an exam. The vehicles that are used by ride-hailing services must also meet requirements that cover mileage, cost, and range.

On September 1, the Ministry of Transportation, Cyberspace Administration of China, Ministry of Industry and Information Technology, and other government departments warned 11 ride-hailing platforms, including Didi Chuxing and Meituan’s ride-hailing unit, against performing illegal operations and actions that disrupt market order.

“Some platforms adopt malicious marketing methods, or recruit unlicensed drivers and vehicles, undercutting rivals to gain market share. The illegal operations disrupted the fair market competition, undermining the interests of drivers and passengers”, authorities said in a statement after the meeting.

The Ministry of Transportation will publish the “compliance rate” of ride providers in 36 major cities every month, starting in September. The ministry will also share a list naming cities that fail to grant licences for eligible vehicles and drivers in a timely manner, the notice said.

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