Proposed Ride-Sharing Standards Spark Concerns Over Foreign Investment and Data Privacy
जेठ २५, २०८३ १९:२८
Kathmandu. Several provisions in the government's proposed ride-sharing criteria have raised concerns among investors and industry stakeholders, who warn that the measures could discourage foreign investment and increase regulatory burdens on digital mobility platforms operating in Nepal.
The Ministry of Physical Infrastructure and Transport has drafted the Digital Mobility Service Operation Standards, 2026, to formally regulate ride-sharing and ride-hailing services nearly nine years after such platforms began operating in the country. The draft is currently under discussion and consultation.
Stakeholders argue that some provisions could make Nepal a highly regulated market, potentially discouraging both existing foreign investors and new entrants. They say the proposed rules may send a negative signal to international companies considering investment in Nepal's growing digital mobility sector.
According to the draft, a central electronic platform will be established to monitor service providers, promote transparency, and enforce regulations nationwide. Operators will be required to maintain service standards, regularly update documents, provide operational data, and fulfill tax obligations.
All ride-sharing platforms operating under various business models must register within the deadline set by the concerned authority. Services regulated by provincial governments will also be required to integrate their systems with the central database through an Application Programming Interface (API), enabling real-time data exchange related to ride tracking, fare calculation, and payment processing.
Critics argue that mandatory integration with the central system could significantly increase compliance costs for international platforms. They have also expressed concerns over data privacy, saying the provision requires sharing user information with government authorities without adequate safeguards.
Industry representatives further claim that data localization requirements could make Nepal less attractive to international technology companies. Information technology experts argue that internationally recognized cloud-security systems often provide stronger protection for customer data than locally managed servers.
Another major concern is the proposed restriction on platform commissions. Under the draft, ride-sharing companies would be allowed to charge a maximum commission of 10 percent from a driver's earnings. Industry stakeholders say this could undermine the business model of international platforms, which typically charge commissions ranging from 20 to 25 percent.
Representatives of foreign-invested ride-sharing companies have warned that such restrictions amount to direct intervention in pricing mechanisms and could affect the profitability and long-term sustainability of digital mobility services.
The sector currently provides income opportunities to more than 200,000 riders and drivers across Nepal. Stakeholders fear that excessive regulation could disrupt the industry's growth and reduce future investment.
Several international ride-sharing companies, including Pathao, InDrive, Yango, and Uber, have entered the Nepali market. Industry observers say restrictions such as fare caps and a ban on surge pricing may further reduce Nepal's attractiveness as a destination for digital mobility investment.
Key Provisions of the Proposed Ride-Sharing Standards
The government says the standards aim to make digital mobility services safer, more reliable, and better regulated. The proposed rules are intended to implement a Supreme Court directive, enhance passenger and driver safety, and improve service quality.
1. Registration and Regulation
Service providers must obtain approval from the Department of Transport Management before operating digital mobility services and must be registered in the central system.
All ride-sharing and ride-hailing platforms currently in operation, including those regulated by provincial governments, will be required to integrate with the department's central system through an API.
2. Fare and Commission System
The draft proposes a maximum base fare of Rs 55 per kilometre for four-wheeled vehicles and Rs 25 per kilometre for two-wheeled vehicles.
Passengers would be required to pay for a minimum distance of two kilometres, regardless of the actual distance travelled.
Fare adjustments during nighttime operations, adverse weather conditions, or traffic congestion would be limited to a maximum of 20 percent above the base fare.
The draft also limits platform commissions to a maximum of 10 percent of the total fare, with the remaining amount to be paid to drivers.
3. Vehicle Standards
Vehicles used for ride-hailing services must not be older than 15 years from the date of manufacture.
Electric two-wheelers must have a minimum peak motor power of 1.5 kilowatts and a maximum speed of 40 kilometres per hour. Four-wheelers must have a minimum motor power of 40 kilowatts and at least 200 litres of boot space.
All vehicles must display a department-approved QR code sticker containing driver and vehicle information. The sticker will remain valid for one year.
Ride-hailing vehicles will be subject to an annual fee of Rs 1,000 for two-wheelers and Rs 5,000 for four-wheelers. The fee will not apply to ride-sharing services.
4. Driver Qualifications and Conditions
Drivers engaged in ride-sharing services must be at least 18 years old, have held a valid driving licence for at least one year, and have no criminal or drug-related record.
Drivers will not be allowed to provide services for more than 12 hours in a day. Platforms must implement an automatic logout system after 12 hours from the driver's first login.
Drivers must wear reflective clothing displaying the service provider's name and logo and carry an identification card while on duty.
New drivers must complete a three-day orientation programme, while existing drivers must undergo two days of refresher training each year.
5. Passenger Safety and Technology
The draft requires platforms to provide an option allowing female passengers to choose female drivers whenever available.
Service providers must operate a 24-hour emergency response and grievance-handling centre. SOS buttons and real-time GPS tracking will be mandatory.
Four-wheeled vehicles must be equipped with a dashcam or CCTV system, a fire extinguisher, and a first-aid kit.
The standards also propose a zero-tolerance policy against offline rides, sexual harassment, reckless driving, and robbery.
Service provider applications must be hosted on servers located in Nepal, be available in both Nepali and English, and securely retain data for at least 18 months.
6. Distance and Passenger-Related Restrictions
Two-wheeled and three-wheeled vehicles will only be permitted to provide services for trips of up to 30 kilometres. Platforms must block bookings that exceed this limit.
Children below the age of 10 and individuals requiring physical or mental assistance will not be permitted as passengers on two-wheeled vehicles.
Drivers will be prohibited from carrying passengers or luggage beyond the vehicle's approved seating or load capacity.
7. Social Security and Accident Fund
Service providers will be required to enroll all workers and drivers in the Social Security Fund.
An accident fund must be established through a deduction of 1 percent from each trip fare and 0.5 percent of the company's daily income.
Under the proposal, drivers or passengers who die or suffer permanent disability in an accident would receive compensation of up to Rs 1 million per person. Medical treatment expenses of up to Rs 100,000 would be covered in cases of injury.
The government says the standards are expected to make digital mobility services safer, more transparent, and better regulated under a formal legal framework.
पछिल्लो अध्यावधिक: जेठ २५, २०८३ १९:२८
