Indonesia backtracks on ride-hailing rules after online furor

Photo by Linkis

Succumbing to severe public backlash, Indonesia’s Ministry of Transportation has backtracked on its proposed ban of ride-hailing transport apps like Uber and Go-Jek.

Ignasius Jonan, Indonesia’s transport minister, was forced forced to do an U-turn on ride hailing apps, and conceded that pubic transport infrastructure in the country’s growing cities were inadequate, after he was rebuked by the country’s president Joko Widodo.

“Innovations in both two and four-wheel transportation exist because they are needed by the people,” President Widodo wrote on Facebook on Friday. “Don’t let rules that haven’t kept up with the development of technology make people suffer,” he had added.

Related: Ride-hailing app ban: Indonesian President rebukes transport minister

Indonesia bans ride-hailing service operators including Uber, GoJek, GrabTaxi

Following the president’s postings on social media, transport minister Jonan said: “Since this (ride sharing apps) has become a public need and in order to fill the gap, given that the public transportation is not adequate to serve all public needs, (ride hailing apps can) please go ahead. However, it is better to coordinate with the Police.”

DEALSTREETASIA had reported Friday that Indonesia had asked the local police to take action against the operators of app-based transport services, as well as prohibit drivers from using the service as they did not fall under the country’s lawful definition of “public transport”.

The Transportation Ministry had barred the ride-sharing bikes and taxis on the ground that they did not meet the legal, established norms for public transportation.

The minister had earlier said, the public transport rules stipulate that such vehicles should at least be a three-wheeler (Indonesia has a huge motorcycle taxi base) and the operators should be a legal entity with a transport permit.

According to Director General of Land Transportation Ministry, Djoko Sasono, the prohibition of the operation was contained in the Notice No. UM.3012 / 1/21 / Phb / 2015 signed by the Minister of Transport Ignatius Jonan, dated November 9 2015.

“The President has just responded to our aspirations by cancelling the Transportation Ministry’s decision on banning ride sharing apps for bikes and cars. Thank you all for your support,” said Co-founder of Go-Jek Nadiem Makarim

Grab Taxi spokesman said, in a statement“We respect and will comply with local regulations. The ride-sharing industry is still in its infancy and we will continue to work with the government and all industry stakeholders to expand the regulatory framework. We believe that it’s our shared objective to make the Indonesian public transportation more efficient, and to enable all Indonesians to commute safely.”

Commenting on Transportation ministry regulation, Tulus Abadi, the chairman of the Indonesian Consumer Foundation (YLKI), said that the basic reason behind the prohibition was correct because motorcycles did not meet the technical specifications for transporting people and they lacked safety standards.

He, however, said the ban is much too late because Go Jek and other similar apps have grown big mainly due to the government’s failure to provide reliable and affordable public transportation.

The YLKI, therefore, urged the government to improve the transport infrastructure.

Anthony Leong from the Indonesia Young Entrepreneurs Association (HIPMI), also questioned the timing of the ban.

The ministry regulation, he said, was already not in favor of the digital industry. “It’s killing the development of startups in Indonesia.The government should be more open to perceive  this,” said Leong.

Go-Jek currently has around 20,000 drivers spread across Jakarta, Bandung and Bali, for many of whom driving is the only source of income.

Also Read: Ride-hailing app Uber gets nod to legally operate in Jakarta

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Singapore: Ride-hailing apps GrabTaxi, Hailo get transport authority green light to operate for three years

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.