Iran's Telecom Minister Defends Ride-hailing Apps

EghtesadOnline: Traditional bricks-and-mortar businesses cannot stop the spread of technology, neither can they intentionally create problems for newly-found Internet-based businesses, according to Iran’s Telecom Minister.

News ID: ۷۳۹۱۲۸

09 January 2017

Referring to the recent disputes surrounding the growth of ride-hailing services in Iran, Mahmoud Vaezi made the case in favor of online trade in a TV program on January 7, ISNA reported.

He said the government is responsible for creating an environment in which traditional businesses can continue working while Internet businesses also have a fair share of the market.

“Wanting to obtain modern technologies yet at the same time insisting on outdated living conditions will not work. Technology should be used in all aspects of life, including agriculture, industries and health,” Financial Tribune quoted him as saying.

Asked about the legal loopholes in the IT-related areas, the minister said the ICT Ministry and the Communications Regulatory Authority have prepared plans to be submitted to the government.

“The government of President Hassan Rouhani believes that development of cyberspace can create jobs. This is one of the primary reasons it has been supporting the growth of this sector.”

He expressed the hope that the “parliament and government could work together” and come up with regulations that will fill the legal vacuum in the fast growing IT sector.

Ali Razavi, head of Tehran Taxi Organization, says law stipulates all public transport in the city falls under the supervision of Tehran Municipality.

This law, however, is often disregarded as several unregistered and independent drivers function as taxis in the city of 12 million people saddled with a permanent shortage of efficient public transport despite the increase in freeways, subways and new taxis.

Razavi added that over the past few years two Iranian ride-hailing companies were launched as they were able to obtain permits for online businesses.

This has caused problems, he said, adding that complaints have been sent to the judiciary following the creation of the new firms.

While admitting that similar services have proven to be successful in other countries (Uber and Lyft), he stressed that the companies should be required to obtain all the permits before launch.

“Drivers apparently prefer to work with the Internet-based companies and this has created problems for older taxi service companies” as they are losing business to the newcomers.

Reza Bagheri-Asl a deputy at the Information Technology Organization also pointed to the activities of ride-hailing firms and said competition is in the interest of everyone.

Electronic Badge

Last week an official at the Ministry of Industry, Mining and Trade noted that Internet based ride-hailing services can operate so long as they obtain the electronic badge of trust for online businesses—otherwise known as eNamad.

The supervisor of the bureau of ecommerce Ramezanali Sadeqzadeh said if certain guilds have a problem regarding the activities of Internet-based businesses they must first file a formal complaint with relevant bodies.

Better cars, affordable fares, and easier accessibility are among the features of Internet-based ride-hauling services.

Accordingly, the older generation of taxis have lost substantial market share. This has led the guilds to protest and strongly oppose the activities of their new rivals. The guilds claim that their activities are not properly supervised.