Uber Regulated
Uber Expands in Emerging Markets

Redoubling its effort to grow in the world’s second largest country, Uber has a deal in the works to invest $50 million in the Indian tech-hub city Hyderabad over the next five years. The WSJ:

The company signed a memorandum of understanding with the state government [of Telangana, where Hyderabad is located], saying it plans to establish a support facility for its ride-hailing app in the city, staffed by hundreds of new employees. A spokesman for Uber said the facility would function as a “helpdesk” for the company. Once the facility is open, India will have Uber’s second-largest employee pool after the U.S. […]

The proposed investment comes as the company faces regulatory uncertainty in the city. Uber isn’t currently authorized to operate its ride-hailing app in Hyderabad, said B. Venkateswarlu, a joint commissioner at Telangana’s transport department. The state authority issued an advisory to passengers earlier this year to avoid using services like Uber, which “didn’t fit the regulatory framework,” Mr. Venkateswarlu said.

Uber’s rapid and unprecedented growth since it began to operate internationally in 2012 has caused it to clash with regulators in developed and emerging markets alike. As a herald of the new sharing economy, anti-Uber movements like those in France last month often seem to be underlaid with protectionist and anti-market sentiments. Uber’s low-cost offering, UberPop—which doesn’t require drivers to have any special certification or licenses—has already been banned in Spain, Germany, Italy, and the Netherlands, and faces scrutiny nearly everywhere it operates.

As authorities in Hyderabad appear willing to find a suitable framework to accommodate the ride-sharing company, Mexico City is similarly trying to find balance between allowing Uber to operate freely and demands that it be expelled from the city entirely. For its part, Uber says it is willing to work towards “[r]egulation that allows us to continue to provide service that is quality, safe and efficient.” Indeed, these should be the only criteria that legislators have in mind when pondering how to regulate the burgeoning sharing economy.

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