Karnataka may suspend Ola and Uber license for flouting distance-based fare structure 

The transport department of Karnataka has sent notice to ride-hailing giants Uber and Ola for flouting fair norms in the state. The transport officials alleged that both cab aggregators have been unlawfully charging time-based fare from the customers.

The Karnataka on Demand Transportation Technology Rules 2016 mentions that app-based cab aggregators should collect fares only on the basis of kilometre as specified by the government, not on the duration of travel.

However, both cab majors haven't implemented the rule and continue to impose an average of Rs 1 per minute for the user’s travel time.

The transport department has given seven days to explain the case and also threatened to suspend the licence of more than 30,000 cabs operating in Bengaluru.

Responding to the matter Ola had said that it is looking into the case and will respond shortly to the transport authority. Uber response is yet to come.

In January, this year, the Karnataka government had implemented minimum fare rules for both companies. Besides Karnataka, Maharashtra and Delhi also introduced regulation of fares of app-based cab-hailing services.

As per the new structure, for the first 4km, the minimum fare was fixed at Rs 80 for Class A (luxury) taxis, Rs 68 for Class B, Rs 52 for Class C and Rs 44 for Class D (small) vehicles.

In a similar incident, last year, Delhi court issued summons to the cab service providers on allegations of overcharging passengers and running taxis in the city without licence.

For the last six months, the SoftBank companies have been facing driver partners' wrath over incentives and fare structure. The driver partners even called for back to back strike in cities like Chennai, Mumbai, and Delhi.

Meanwhile, Ola and Uber also have been in talks for a potential merger.

The development was reported by TOI.