Continued heated debate about Uber, Grab

Dozens of taxi businesses and representatives of the Taxi Association, Vietnam Automobile Transport Association... participated in the workshop "Conditions for doing business in automobile transportation: Issues and recommendations" organized by the Central Institute for Economic Management this morning (January 23) to contribute ideas to amend the decree replacing Decree 86, "unleashing" traditional taxi businesses.

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The story of Uber and Grab continues to heat up the forum when taxi companies claim that they are competing unfairly with Uber and Grab. Mr. Nguyen Cong Hung, Chairman of the Hanoi Taxi Association, cited that businesses have to conduct regular health checks for drivers, which takes a lot of time and money, while Uber and Grab do not.

Mr. Truong Dinh Quy, Deputy General Director of Vinasun Taxi, said that in 3 years (from 2014 to 2016), Grab only paid more than 9 billion VND in taxes while Vinasun paid 1,200 billion VND. "If we were able to reduce 1 billion VND in taxes every day, the prices would be completely different. That is to say, unclear regulations allow Grab and Uber to avoid 13 business conditions like taxis and a series of other management issues," Mr. Truong Dinh Quy affirmed.

The provisions in the draft Decree are also considered by many business representatives to have not resolved the long-standing conflicts between traditional taxis and Grab and Uber. Specifically, Grab and Uber are still considered contracted transport vehicles, not taxis.

Currently, there are more than 50,000 vehicles nationwide that are licensed as contract vehicles with less than 9 seats (i.e. vehicles operating for Grab and Uber under the Ministry of Transport's pilot program). Taxi companies say that this has caused traditional taxis to shrink. Mr. Nguyen Cong Hung said that currently, Hanoi has only 15,000 taxis instead of 25,000 like 5 years ago.

Issue yellow license plates to manage Uber and Grab?

Mr. Nguyen Cong Hung proposed that the Ministry of Transport direct localities to immediately stop increasing the number of vehicles participating in the pilot electronic contract vehicle program.

Talking to Tin Tuc reporter, economic expert Ngo Tri Long said: To build a proper management mechanism for each type of automobile transport business, it is necessary to determine the nature of the problem. Traditional taxis believe that contract transport is also a type of taxi, so why does it have its own mechanism? But contract transport vehicles also have their own reasons because before going, customers know the distance, the amount of money, the driver, and the vehicle.

"My point of view is that each type has its own differences but also has common overlaps. We should find out if the common overlaps are very large and group them together, but if the overlaps are large, they should be separated. We must clearly understand the nature of the problem to build a management mechanism," said Mr. Long.

Decree 86/2014/ND-CP on business and conditions for business of automobile transportation was issued on September 10, 2014. After more than three years of implementation, the Decree has revealed shortcomings and inadequacies that need to be amended and supplemented to ensure a healthy competitive market and improve the quality of automobile transportation services. The Ministry of Transport has submitted to the Government a draft of a replacement Decree. However, many shortcomings and problems of enterprises have not been resolved.