Vietnam bans new carpooling services from Uber, Grab
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The authorities say sharing a car with a stranger comes with risks that passengers should not ignore. It’s yet another bumpy ride for popular ride-hailing services Uber and Grab.
Their new carpool versions in Vietnam, UberPOOL and GrabShare, have been blocked by the Ministry of Transport, not long after their summer launch.
Low-cost services that allow drivers to pick up an extra person along the way will create risks for the passenger, the ministry said in a new statement. stopping short of mentioning any such incidents.
The ban is to protect Vietnamese passengers from what could happen, it said.
If Uber and Grab disobey the rule, they will be fined VND4-6 million ($175-260) per ride.
Last month, U.S.-based Uber and Malaysia-based Grab rolled out their carpooling services in Vietnam, promising to help passengers save 30 percent of payments by splitting the costs.
Uber and Grab entered Vietnam in 2014. Since then, the two have repeatedly made headlines for regulatory issues.
Exisiting service providers have not been happy. Vinasun and Mai Linh, the two major taxi companies in Vietnam, blame their business difficulties on Uber and Grab, saying the competition has been “unfair” because the foreign firms are not subjected to strict tax rules.
Questions & Answers
Q.What reason did the Ministry of Transport give for banning UberPOOL and GrabShare?
What reason did the Ministry of Transport give for banning UberPOOL and GrabShare?
The Ministry stated that sharing a car with a stranger creates risks for passengers that should not be ignored. The ban aims to protect Vietnamese passengers from potential incidents, though no specific ones were mentioned.
Q.What are the financial implications for Uber and Grab if they continue to offer carpooling services?
What are the financial implications for Uber and Grab if they continue to offer carpooling services?
If Uber and Grab disobey the Ministry of Transport's rule, they face fines. The penalty for each ride conducted via the banned carpooling services is VND4-6 million ($175-260).
Q.How have existing taxi companies in Vietnam reacted to Uber and Grab's presence?
How have existing taxi companies in Vietnam reacted to Uber and Grab's presence?
Major taxi companies like Vinasun and Mai Linh have attributed their business struggles to Uber and Grab. They claim the competition is unfair because the foreign firms are not subject to the same strict tax regulations.
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