Bolt Tanzania is unable to do business because of the directives issued by authority

Bolt, an Estonian mobility company has announced that it will cease operations in Tanzania after a new 15% service charge order was implemented on the 15th April 2022.

Startup claims that it has reached out to all relevant stakeholders, including the Land Transport Regulatory Authority of (Latra), in order to renegotiate new terms.

Bolt’s East Africa Regional Manager, Kenneth Micah said, “Bolt has requested a meeting with the relevant stakeholders to further discuss this particular matter with the hope of reaching favourable tariff and commission regulations, even as we continue to seek and explore alternative lobbying options provided within the legal framework including Latra regulatory framework.”

This is a week after Uber had to suspend operations in Tanzania, due to the difficult regulatory environment.

Latra, the authority charged with regulating taxi services in Tanzania, reviews and sets fares for ride-hailing companies in Tanzania.

Bolt, which charges 20% to its partners, stated that it would switch off its car category if there are no changes. This would mean that smaller players such as Little (which charges a 15% commission) and Ping will have to compete in the market. Uber previously charged a 25% commission.

“While we acknowledge and appreciate Latra’s mandate, we strongly believe that the introduction of control tariffs in a well-functioning and competitive ride-hailing sector is detrimental to a free market economy. Nevertheless, Bolt has implemented the directive under duress and for a limited interim period,” said Micah.

“We are complying temporarily to demonstrate goodwill and our commitment to engage with Latra for more favourable regulations that enable further investment. We are cognizant of the fact that should Latra maintain the status quo, the market will eventually cease to be viable for Bolt, and this will necessitate turning off our car category.”

Latra had previously reviewed the rates for ride-hailing services, including the maximum distance (per km) and commission. In the new directives, Latra requires ride-hailing companies to reduce the “dead kilometres” — the distance drivers are expected to cover to pick up a passenger.

And also to provide a platform where drivers can be “heard” when passengers lodge complaints. In response to rising fuel costs, the authority increased the per-kilometre charge for ride-hailing companies.

Bolt, which operates in seven African markets, including Kenya, South Africa and Uganda, Ghana, Nigeria, and Nigeria, stated that it would negatively affect more than 10,000 drivers if it stopped its service in Tanzania.

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