Exclusive - Mexico City to regulate Uber with license fees, ride levy: draft

MEXICO CITY (Reuters) - Uber, the ride-hailing service that has spurred a regulatory backlash in cities around the globe, is facing its latest hurdle in Mexico City, with a proposal that would require the company’s drivers to have permits.

The Uber logo is seen on a vehicle near Union Square in San Francisco, California May 7, 2015. REUTERS/Robert Galbraith

In addition, according to a draft government plan seen by Reuters, Uber would have to pay a revenue fee into a new city transport fund and Uber and companies like it would be banned from accepting cash payments from customers, offering prepaid plans or using taxi stands.

Uber currently accepts only credit cards for payment, except for a test programme in India.

As Uber’s business has expanded to 57 countries and its estimated value has exploded to more than $40 billion, it has faced increasing calls for regulations as taxi drivers in various cities have tried to defend their turf.

Under the proposal in Mexico City, Uber will have to pay a license fee for each vehicle on its platform of 1,599 pesos (66 pounds) per year and give about 1.5 percent of domestic revenue to a newly created city transport fund, an official close to the capital’s transport secretary Rufino Leon told Reuters on Tuesday.

Uber public policy chief Corey Owens said the plans are at the “high end” of what the company pays in other major cities, pointing to a 1 percent charge in Washington, D.C.

Owens said Uber had not seen the draft, so could not say if the proposed costs would be imposed on drivers or passengers. In Washington, London and New York they are paid by passengers, he said, but elsewhere the drivers make up the cost.

The plan is still being negotiated and could change before the regulation’s expected publication next week, the city official said.

Ruben Alcantara, a taxi union leader who showed Reuters the draft, said he had been told Uber would have to pay between 3 and 5 percent of revenue into the transport fund at a meeting with Leon on Tuesday.

He could not explain the discrepancy with the figures given by the government official, who was also at the meeting.

Alcantara said he will be meeting officials again this week to demand a cap on the number of Uber cars in the city. Owens said such a cap would damage mobility options and that no city in the world had imposed such a limit.

Mexico City is home to 140,000 registered taxis, and drivers have previously protested in the streets against Uber and called for it to be banned.

Uber launched in Mexico’s capital in 2013, and Owens said it is now one of its fastest-growing markets with 500,000 users.

The company also faces challenges elsewhere in Latin America.

Lawmakers in Sao Paulo, Brazil’s biggest city, and capital Brasilia have voted to ban Uber after protests by local taxi drivers and after the Sao Paulo government seized 23 vehicles since August. The bills still require executive approval and Uber expects to continue functioning there despite a near unanimous vote in Sao Paulo, Owens said.

There have been sporadic attacks against Uber drivers by Bogota’s regular taxis, while an Uber driver was shot at by cab drivers in Rio on Saturday, a taxi driver who witnessed the attack said.

Colombian authorities have deemed the company illegal and police have impounded a number of cars offering services on its app, but Uber says it will continue operations in the country.

In a region with notorious corruption problems, Owens said Uber has a “strong anti-bribery policy” and has never paid a bribe, but would not say if one has ever been solicited.

Additional reporting by Christine Murray in Mexico City, Brad Haynes in Sao Paulo, Stephen Eisenhammer in Rio de Janeiro and Peter Murphy in Bogota; Editing by Simon Gardner, Christian Plumb and Leslie Adler