Uber and City of Cape Town locked in licence battle

Drivers caught in middle as more cars are impounded

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Photo of car pound
The City of Cape Town has impounded 480 Uber vehicles this year. Photo: Ashraf Hendricks

Uber drivers are desperate for the City of Cape Town to issue more operating licences as they face vehicle impoundments for operating without a licence.

But the City says that Uber drivers have not used all the licences made available because they have not followed all the steps or met the requirements.

Samantha Allenberg, Uber spokesperson, said that the delays are due to City backlogs in processing the application documents and that “all drivers-partners using the Uber app have already completed the required steps in applying for their operating licenses.”

“Driver-partners are providing for their families and giving the citizens of Cape Town a service they want and need: safe, affordable and reliable rides,” Allenberg said. “However the City continues to enforce impoundments even when the delay is on their side.”

The City has impounded about 480 Uber vehicles in 2018, according to Richard Bosman, Executive Director of Safety and Security for the City of Cape Town, compared to 646 for the whole of 2017. There is no reason for the uptick in impoundments besides the fact the City has more resources to focus on the Uber permitting issue than before, according to Alderman JP Smith, Mayoral Committee Member for Safety and Security.

“They’re breaking our spirit and it is very unfair,” said Riyaad, 34, who has been an Uber driver for four years. “We’ve been waiting for permits since 2015.” His car was impounded once while driving a customer in Claremont. (He asked to be identified only by his first name.)

An Uber driver must obtain an operating licence to avoid impoundment. The City of Cape Town made 1,035 operating licences available in 2015. A successful application depends on having documents in order, such as work visas, proof of residence and vehicle ownership, according to Councillor Brett Herron, the Mayoral Committee Member for Transport. There must also be a need for transport services in the area.

Of the 1,035 metered-taxi operating licences offered to Uber drivers, 465 are still available to those that have started applying but have not yet completed all the necessary steps, according to Herron.

Uber helps drivers to apply, and Herron said it takes about 60 days for the City to review applications. These are then sent to the Western Cape Provincial Regulatory Entity for final approval and the issue of the licence. Herron said the City of Cape Town had approved 56 applications in 2018.

GroundUp tried to contact the Western Cape Provincial Regulatory Entity for comment, but without success.

Uber drivers found without an operating licence must pay impoundment fines to retrieve their vehicles. The City has collected over R13,200,000 from vehicle impoundments since the start of the fiscal year in July of 2017, according to Smith. Roughly 20% of impoundments in 2018 are cars driven by Uber drivers, according to Richard Bosman, executive director of safety and security for the City.

Bosman said the City conducts traffic stops at checkpoints and requests that Uber drivers show their operating licence. If the driver does not have a valid licence, the car is impounded in a lot in Maitland or Ndabeni.

Mandla Hlatshwayo, an Uber driver, said his car had been impounded on a Friday evening. Traffic offices are closed over the weekend, meaning Hlatshwayo could not retrieve his vehicle until Monday. “I work from Monday to Friday to pay the rental of my car and then I work the weekend to pay for other things for family. That threw me off financially. Even till now I couldn’t pay my debts because I was impounded.”

Bosman said to retrieve a vehicle, drivers had to pay an impoundment release fee as well as a fine of R7,500 for a first offense and up to R15,000 for a third offence. Drivers who do have licences but are operating in violation of the terms of the licence, must pay a fee of up to R10,000 for a third offence.

Hlatshwayo and Riyaad said that Uber covered the impoundment fines by paying money into Uber drivers’ accounts. Uber did not say if they pay the fines, but Allenberg said that “we are doing as much as we can to make this process easier for driver-partners and will continue to support and stand by our driver-partners until we have a solution from the City.”

Despite the financial assistance, impoundment still takes its toll on the drivers.

Riyaad said the City did not want to issue more permits because of the money made from fines.

“They don’t want to release the permits because it’s like an ATM,” Riyaad said. “Uber pays for it, but the Uber drivers suffer two-to-three days loss of money.”

Herron said the City can determine the number of licences available but ultimately cannot grant licences (this is the job of the Provincial Regulatory Entity). Since Uber drivers have not used the entire first batch of licenses, the City does not want to make more available.

Lack of an operating licence is not the only cause of impoundments of Uber drivers’ cars. If they drive more than 35km outside their their permit zone, the City can impound their cars, according to Herron. This means to complete trips to Stellenbosch or other extended trips, drivers operate illegally.

Uber drivers must either own their car or have their car financed by a registered credit provider, such as a bank, due to conditions imposed by the Western Cape Provincial Regulatory Entity, according to Herron. If an Uber driver does not meet either condition, the driver cannot get a licence. Drivers such as Riyaad and Hlatshwayo rent their cars because they cannot afford to own one, and so would not meet licence requirements.

Allenberg said that Uber tried to help drivers get bank finance for cars. She said drivers all had professional drivers’ permits, insurance and roadworthy certificates.

The City said it was working to resolve the operational licences issue with Uber.

Update from Western Cape government on 7 June, 10:45am

After publication, the Western Cape Provincial Regulatory Entity responded to Uber drivers’ criticisms of the delays. The PRE has granted 802 licences in the last three years, according to Byron la Hoe, spokesperson for the Department of Transport and Public Works. Once the licence is granted, it is up to the driver to validate the licence with a vehicle inspection and relevant paperwork.

“The Western Cape PRE has the best turn-around times in the country and we take great pride in delivering quality services,” la Hoe said. “The affected operators will have to provide reference numbers for this averment to be investigated.”

La Hoe also said that rented cars are allowed by the Western Cape “provided that the applicant is registered as the operator of the vehicle with the relevant registering authority”. This contradicts the City’s response on renting cars to use for Uber.

TOPICS:  Transport

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Write a letter in response to this article


Dear Editor

Metered taxis have built an industry where operating licenses have been passed down through families, generation to generation. Many of these operators work at the harbour, waterfront and airport ranks and many have also embraced e-hailing technology.

Facts around operating licenses are clear, the City is supposed to look at their needs and requirements and then determine how many taxis they should have on our roads. Whether it be base, rank or e-hailing taxis the numbers need to be regulated as should the industry.

To hear that the driver in your article has been driving for four years without an operating license is a reflection on the company placing him in a position that enables him to operate illegally. The city, province and national government have been aware of this however national legislation passed last month, with effective enforcement, hopefully will provide security to those in the industry.

I would like to support the City and province for eventually taking a stand on the matter albeit rather late in the game. This is an industry where operating licenses are issued with the understanding that your service is required after careful needs analysis are conducted by the relevant municipalities. The City is correct in highlighting the reason for those permits still not been uplifted is because the requirements are too stringent and the checks and balances on the vehicles are thorough (taken 3 years to uplift 1000 promised operating licenses is a direct result of "well it is easier to be illegal than get legal".

The fact that Uber representative says the City is dealing with backlogs is not correct, the city is not issuing, simple because there is no need for more. If you not licensed to operate on our roads, no matter the reason, you have no place where legal meter taxis, Uber and Taxify operators, conduct their business lawfully. Over-trading is a real concern.

Dear Editor

If your application is rejected and you want to appeal, you have to pay R1,000 so that they can sit and reconsider your application. Mine was rejected in February but l had applied in October 2017. It was rejected in February 2018 and l paid R1,000 for an appeal.

We are now in June and l have not heard from them. They just said further communication will be done in due course. All my documents are in order and the car is registered in my name. I can provide all the documents from the day l applied and the receipt for the appeal fee of R1,000. I don't know what's the hold up.

Dear Editor

More than 95% of visitors to Cape Town require an Uber taxi. This is firstly based on the global standards of the Uber brand. This encompasses the stringent vetting of its drivers and peace of mind offered with regard to personal safety.

This is assured by the advanced panic app that drives have. It is unfortunate that the City of Cape Town does not consider this as important to tourism, nor to its domestic or business users.

Dear Editor

Interesting to see both Uber (drivers) and Airbnb hosts require relevant authorisation from the city to operate.
However, the city continually targets & prosecutes Uber drivers but completely ignores those using apartments for Airbnb purposes.

To the best of my knowledge, not a single Airbnb operator (hundreds of airbnb apartments) on the Atlantic Seaboard has the required consent from the city, yet they are not prosecuted for contravening city by-laws.

Selective application of legislation.

Dear Editor

This licence battle doesn't only affect drivers and Uber. We as owners of the cars are worse hit by this issue. Some drivers also used this to con vehicle owners because they know Uber always refunds the impound fee.

My previous driver was not supposed to be working on the 10/11/2018, but he did anyway. I called him to come to my workplace to take the car for maintenance but he never did. He was given 2x fines that day for driving in unauthorised areas. Despite this, he keep on driving until the car was impounded in the Waterfront.

I had to borrow money to have the car released. When I gave the driver paper work to get the refund from Uber, he instead made a request to Uber to pay that money to a new partners account he also works for without telling me. I informed Uber and they saw that the transaction had gone to the wrong person but said they cannot help me because they already paid the money.

I was told to speak to the driver, but that driver was rude to me until he blocked my phone number.

Dear Editor

I'm a Uber partner, and have applied for a OL in early 2016 but nothing still to this day. The excuse of OL licences not being taken up by applicants is convenient to keep the status quo the same and keep the CoCT milking Uber, it's partners and drivers for money.

The truth is that the City is quite happy collecting the impound fees, and does not want to issue final notices to those applicants that allegedly didn't complete the application to take up licences, and redistribute those licences to the ever-growing list of applicants. By now there should be 2,500 applications from Uber alone.

This along with the colluding, bribery and corruption between some officials and the incumbent taxi/bus operators, who lets be honest, are pushing for things to remain stagnant, so they can beat on the 'operating illegal' drum they holding onto for dear life. They realised that they are being disintermediated by entrepreneurs that are enabled by technology. It's the same reason why vehicles (and some drivers) who are a danger to the public on the roads are allowed to operate with a mindset of impunity and a general disregard for the laws of the road and other road users.

If this city wants to create jobs and reduce unemployment, it should take a hard look at its stance towards entrepreneurs who are trying to provide for themselves and their families.

Dear Editor

I am really bleeding inside my heart. My car was impounded while I was on my first trip - it is a bank finance car. The money I earn doing on Uber helps my whole family, including my son who has a disability. I applied for a permit but the City of Cape Town just emailed me saying they are refusing to issue me a permit but didn't say why.

On that matter, my car passed inspection and is roadworthy. Can the City take over providing for our families and raising our kids since they don't want us to hustle or maybe the City could give us better jobs or pay off my car loan? Clearly the City of Cape Town is against Uber drivers - we always pay the highest fines and get our cars impounded.

Why is City of Cape Town making their problem ours?

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