May 10, 2016 / 11:10 PM / 3 years ago

Sao Paulo mayor to authorize Uber with mileage fee

The logo of car-sharing service app Uber on a smartphone over a reserved lane for taxis in a street is seen in this photo illustration taken in Madrid on December 10, 2014. REUTERS/Sergio Perez

SAO PAULO (Reuters) - The mayor of Sao Paulo, South America’s largest city, laid out regulations on Tuesday to allow the use of Uber and other ride-hailing apps in exchange for a mileage fee, triggering anger among taxi drivers who blocked major avenues.

Mayor Fernando Haddad plans to formalize the decision with a decree on Wednesday, overriding attempts by city council members to ban Uber and other apps they accuse of unfairly competing with licensed taxis.

Under the decree, Brazil’s congested business hub will charge an average fee of 10 centavos (3 cents) per kilometer for drivers working with Uber Technologies Ltd [UBER.UL] and newly arrived Spanish rival Cabify, the mayor’s office said.

The city expects to raise around 40 million reais ($11.5 million) a year with the measure, said Ciro Biderman, head of innovation for development agency SP Negocios, which designed the new regulations.

Irate cab drivers blocked a major artery during the evening rush hour and television footage showed a crowd pounding on the windows of a black car with tinted windows, fitting the profile of a standard Uber vehicle.

Uber embraced the mayor’s decision, calling it “the first step toward guaranteeing that apps intermediating travel with technology have a place in the city.”

Cabify declined to comment.

Reporting by Natalia Scalzaretto; Writing by Brad Haynes; Editing by Peter Cooney

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