Fri, 03 Jul 2015

Indonesia’s lawmakers are planning to start deliberations on a new law that would address the rapid growth of smartphone-based transportation applications.

The new law would regulate the increasingly popular services, which otherwise fall into a grey area in the country’s existing transport regulations, the Jakarta Globe reported.

Yudi Widiana, vice chief of the Commission V, which oversees transport, public works, housing and rural area issues, confirmed that the House is planning a special assessment on the issue, noting the legal and safety concerns surrounding these mobile apps.

“We’re not trying to impede innovation, but these services must clearly explain what their core business is. These apps are popping up based on public demand. We’re willing to make some room and initiate a new law,” he said.

Malaysia’s cab-booking app Grab Taxi, homegrown motorcycle jockey app Go-Jek and California’s ride-sharing app Uber have become household names among commuters in large Indonesian cities like Jakarta, offering an alternative for residents to maneuver through heavy congestion.

Grab Taxi Indonesia, a local unit of Malaysia’s Grab Taxi, rolled out operations in Jakarta in June 2014. The cab-booking smartphone application is now present in Surabaya, East Java, and Padang, West Sumatra. It has expanded its reach to include motorcycle jockeys with Grab Bike in May 2015.

Meanwhile, Go-Jek has hired over 10,000 motorcycle drivers in Jakarta since its establishment in 2011, offering a range of services from transport to couriers.

Since its launch in Jakarta last August, Uber Technologies now offers the Uber app in three cities: Jakarta, Bali and Bandung.

Despite their apparent success, the ride has not been smooth for these companies as their unconventional business models continue to face scrutiny from traditional cab operators and law enforcement officials.

Last month, the Jakarta Police detained five drivers who had used the Uber app to pick up passengers, following reports from the Jakarta Transportation Agency and the Organization of Land Transport Operators (Organda).

“We have to be consistent with government regulations,” Jakarta Transportation Agency chief Benjamin Bukit said regarding the arrest. But considering the rise of these smartphone apps, [the House] should swiftly acknowledge the trend and create an IT-based law.”

Gojek’s founder Nadeem Makarim welcomed the government’s recent efforts, stressing that the core essence of the regulations must be “passengers’ safety”.

As the use of these transportation apps continues to spread across the country, the government’s urgency in responding to the rising trend is critical in order to ensure order and most importantly, passengers’ safety, said one transport expert.

“In reality, Uber and other similar apps would not exist if people didn’t need them. If that was the case, then the apps would die,” said Purnomo, secretary general of the Indonesia’s Transportation Society.

“Whether we want to or not, there needs to be a breakthrough to address this issue,” he said. “There’s something new [in the market] and we must quickly respond to it.”