SA association files official complaint against the company while acknowledging the need to implement technology
Eight regional taxi companies and 150 individual members of the SA Meter Taxi Association have filed an application against Uber with the Competition Commission, alleging that the US-based company is engaged in predatory pricing and anti-competitive behaviour.
Predatory pricing is the act of setting prices low in an attempt to eliminate competition.
Association chairperson Faye Freedman, who is also the CEO of Eagle Taxis in Durban, confirmed this week that her association had filed the complaint and the members involved with the application employed about 1 000 people.
Uber is facing a similar case in New York, where taxi drivers are suing the city and its taxi and limousine commission, alleging that the online transport company is destroying their businesses, according to the Guardian’s website.
“Uber needs to jump through the same hoops as local taxi operators,” said Freedman, alleging that “Uber’s operations in South Africa are illegal – they are not complying with the National Land Transport Act.”
Alon Lits, general manager of Uber Sub-Saharan Africa, said in response: “Uber does not own ... any vehicles, but rather licenses technology to independent transport operators who can then connect with people wanting a ride. These partners are required to hold all the appropriate operating licences.”
“The main remedy we are seeking from the commission is to get Uber to change its behaviour and model in South Africa,” said Freedman.
If, in addition, the commission saw fit to fine Uber, then the applicants would welcome it, she added.
Taxi companies were finding it hard to compete with Uber because the pricing, especially for its low-cost UberX service, was unrealistic, she said.
Last month, Uber cut its standard fare to R6 per kilometre in Joburg, Durban and Cape Town for its UberX service in an effort to boost its volumes.
The fare cuts resulted in protests by some of the platform’s driver partners. “We do not have the commercial muscle and aggressive tactics of Uber,” said Freedman, adding that the SA Meter Taxi Association would be looking at other ways to legally challenge Uber in the future, but the submission to the commission was a “good start”.
“There have been protest marches staged against Uber by taxi drivers in Cape Town and Joburg, and a march took place in Durban on Thursday,” said Freedman.
“We are not against Uber’s technology. We will also be looking to implement technology into the industry.”
Itumeleng Lesofe, spokesperson for the Competition Commission, said the commission had received a complaint against Uber.
“This complaint was filed in November last year and is under investigation,” he added.
Lits said that competition authorities around the world had welcomed Uber’s impact. He quoted authorities in Poland, Germany and Mexico, which had all been positive about Uber’s benefit on competition in the transport market.
In Spain, Lits said, where Uber was previously banned from operating by a judge’s order, the national competition commission took government to court over restrictive private-hire regulations.
“Uber ... technology is fundamentally changing how people move around their cities,” said Lits.