Bolt, a popular ride-hailing service, may be forced to stop its operations in Tanzania as a result of a contentious 15 percent charge service order that took effect on Friday, April 13th.
The Estonian company is contesting a levy imposed by the Land Transport Regulatory Authority (Latra), an entity established in 2020 to regulate the taxi industry.
“Bolt has requested a meeting with the relevant stakeholders to further discuss this particular matter with the hope of reaching favorable tariff and commission regulations, even as we continue to seek and explore alternative lobbying options provided within the legal framework including Latra regulatory framework,” said Bolt East Africa regional manager, Kenneth Micah.
Bolt, which charges a 20% commission from its partners, has stated that if nothing changes, it will shut down its automobile category. This would leave the market to smaller firms like Little and Ping, who both charge a 15% commission.
Uber, which charges a 25% commission, stopped operations in the country last week over the same issue, but indicated it would return if the circumstances improved.
Bolt, which operates in seven African markets including Kenya, South Africa, Uganda, Ghana, and Nigeria, claimed the suspension of service in mainland Tanzania would affect over 10,000 drivers.
Mid last month, Latra reviewed the rates for ride-hailing companies, including the maximum distance (per kilometer) rate and commission.
In the new directives, Latra requires ride-hailing companies to reduce the “dead kilometers” — the distance drivers are expected to cover to pick up a passenger, and to provide a platform where drivers can be “heard” when passengers lodge complaints. The authority also doubled the per-kilometer rate for ride-hailing companies due to increasing fuel prices, and set a minimum fare too.