Warning about new e-hailing laws in South Africa

South Africa’s new e-hailing regulations will be harmful to already-exploited individual drivers, while international ride-hailing companies continue to operate unchecked.

This is the perspective shared by the South African e-hailing association (SAEHA).

“While these burdensome regulatory requirements target individual operators, the government has overlooked addressing more critical systemic issues,” Trevor Mathebula, Deputy Secretary of the association, told Newsday.

“This is, namely, the role and accountability of international app platforms like Uber and Bolt,” he said. 

The National Department of Transport recently gazetted the amended National Land Transport Amendment Act, which it claims will recognise e-hailing officially.

The department said that the service has been treated as an illegal operation by other service-type operators on the streets.

The new act requires drivers to have operating licenses “to ensure services remain authorised and safe”, and it sets rules for the quality and security of vehicles.

Additionally, under the new rules, drivers are required to brand their vehicles to indicate it is used for e-hailing. 

“Requiring drivers to brand their vehicles openly exposes them to undue risk by making them easier targets for criminals and rival operators,” said Mathebula. 

This follows recent violence in which an e-hailing driver was stabbed and set on fire in his vehicle at Mopanya Mall in Soweto in August 2025. 

“The measure may inadvertently endanger lives rather than protect them,” Mathebula said. 

Panic buttons must now be installed in the vehicles at the cost of the drivers. Drivers will also be confined to specific geographic zones.

When picking up passengers, e-hailing drivers will be required to drive from point A to point B and then return to point A before picking up further passengers. 

Meanwhile, the department’s rules for app developers are more lax, according to Mathebula. 

App developers who are caught allowing drivers to use their apps without an operating licence risk a fine of R100,000 or two years in jail. 

Additionally, all apps must be registered with regulators. Mathebula argues that this is not enough to control global giants like Uber and Bolt.

In a statement, Uber said that it is “currently assessing the requirements of the new legislation and remain committed to working with government and industry partners to support a smooth transition.”

“Our focus remains on ensuring drivers can earn sustainably, while maintaining strong safety and compliance standards and delivering a seamless experience for riders.”

The upward battle of independent contractors

Many e-hailing drivers in South Africa are currently struggling to earn a living. Ride-hailing apps charge an average of about R5 per kilometre, sometimes more. 

Drivers rarely see adequate returns, and often earn below South Africa’s minimum wage, with some unable to afford housing and forced to sleep in the cars they rent, according to Mathebula. 

“Uber and Bolt’s operations in South Africa were, from the start, built on the backs of illegal migrant workers who accepted these conditions simply to survive and put food on the table.”

“Sadly, South Africa’s laws were not designed with these realities in mind,” he said. 

E-hailing drivers in South Africa operate as independent contractors, not employees, and are therefore not entitled to labour law employee protections. Drivers, therefore, have little job security.

“If we have issues, who must we go to? The owners of this app are in Europe or somewhere. They don’t care about us, so we just keep quiet so we continue to have an income” one driver told Newsday.

According to data obtained from Uber by News24 in February, Uber is one of the biggest creators of employment in the country, with 52,000 drivers.

This is more than Woolworths, 38,623, and Spar, 11,191, combined. Bolt, additionally, disclosed it had over 40,000 drivers across South Africa in 2023.

While the apps generate tens of billions of rands annually from the South African economy, they have never fully disclosed the scale of their financial outflows, with some estimates suggesting around R16 billion a year.

Mathebula said the corporate structure of these apps is concerning; for example, payments made on the Uber app are routed through a Dutch entity, Uber BV, which facilitates the transfer of money out of South Africa.

As a tax workaround, profits are then kept artificially low as the Dutch holding company pays the Singapore-based parent company for a EUR16 billion loan.

It’s worth noting that Uber’s tax strategies are legal under current international tax frameworks, though they exploit loopholes that many argue need reform.

The Netherlands is a known conduit for such arrangements due to its favorable tax policies.

South Africa has become a “banana republic” – Mathebula

“The Uber files leak revealed that Uber knowingly broke laws in South Africa, illustrating a blatant disregard for local regulations and the welfare of South African drivers,” said Mathebula.

The Uber Files are a collection of 124,000 documents that a whistleblower within Uber leaked to The Guardian. 

The files revealed how co-founder Travis Kalanick tried to force the e-hailing service into cities around the world, breaching laws and taxi regulations. 

The leak included evidence that Uber attracted drivers in South Africa by offering them bonuses and incentives, and then undercut them.

During its market expansion in Cape Town and Johannesburg, it alleged that Uber rewarded workers for undertaking routes and schedules that put them at risk of harm in locations plagued by violence. 

Uber has denied this and emphasised that its “focus is on the safety of its drivers, riders and community at large.”

Mathebula said that the government’s latest failure to restrain these international companies has shown that South Africa has become a “banana republic” that is exploited by companies and sidelines its own local driver interests. 

“It is imperative that South Africa conduct a thorough investigation into these multinational companies profiting massively while contributing little to the local economy,” said Mathebula.

He said that this problem will only worsen as these companies prepare to deploy self-driving technologies globally, further squeezing local drivers out of their profits. 

“We must shift focus away from excessive regulation of individual drivers toward holding these companies accountable.”