US ride-hailing giant Uber has suspended its services in Tanzania, saying government legislation raising fares and cutting its commission has made it difficult for it to operate.
Uber said it made the “difficult decision to suspend operations” in the east African country from Thursday.
“The pricing regime proposed by the Land Transport Regulatory Authority (LATRA) makes it difficult for platforms like Uber to continue operating,” Uber said in a statement Thursday.
Under the new rules, which come into effect this month, fares have doubled to 900 Tanzanian shillings (around Rs. 30) per kilometer.
In the meantime, the maximum commission for the transport service providers has been set at 15 percent from the previous 33 percent.
The transport regulator said the changes aim to maintain competition and ensure affordable taxis.
It defended the rules late Thursday, saying all providers except Uber had complied with the new regulations.
“We remind all ridesharing companies to abide by the rules and regulations of doing business to stimulate the economy,” LATRA Director General Gilliard Ngewe said in a statement.
Uber — founded in 2009 — arrived in Tanzania in 2016, capitalizing on the country’s small number of private car owners and lack of an efficient mass transit system.
The San Francisco-based company said it remains committed to resuming long-term operations once the price war is resolved.
“We remain available to work with regulators to create a framework for the technology to thrive so we can restart and offer a service loved by so many.”