The Ministry of Transportation and Communications yesterday said it would closely monitor the business model of Ledi Technology (樂迪科技), the Taiwanese franchisee of Chinese ride-hailing firm Didi Chuxing (滴滴出行), adding that the company would be punished if it violates the Highway Act (公路法).
Democratic Progressive Party (DPP) Legislator Tsai Yi-yu (蔡易餘) said that Ledi, which began trial operations on Jan. 9, is in charge of promoting Didi’s app in Taiwan.
The application matches passengers with available taxi drivers, Tsai said, adding that taxi drivers would each be given a NT$200 coupon for downloading the app and NT$500 bonus for their first ride.
Photo: Peter Lo, Taipei Times
Starting today, the application also matches passengers with private car owners who can offer rides to people, Tsai said.
Even though Ledi has yet to charge taxi drivers for accessing the app, Tsai questioned how the company is able to operate with a capital of only NT$200,000 (US$6,861) and if it has received funding from China.
Tsai said that the Cross-Strait Service Trade Agreement, which was signed during the administration of former president Ma Ying-jeou (馬英九), bans Chinese companies from investing in Taiwan’s transportation industry.
However, Chinese firms are developing transportation-related apps and using them to collect data, Tsai said, adding that the company’s operations resemble that of the Chinese Union Promotion Party.
Investment Commission section head Chu Ping (朱萍) said that it has come to the commission’s attention that a Hong-Kong-based company has invested in Ledi.
The commission has doubts over Ledi’s plan to raise capital and the company has been told to offer an explanation within two weeks.
The company must explain the sources of its funding, its relationship with Didi and how it plans to implement information security, Chu said, adding that the Ministry of Transportation and Communications, the Mainland Affairs Council and other government agencies would jointly review the case.
The review could last more than three months, Chu said.
Department of Railways and Highways specialist Wang Chi-chou (王基洲) said that Ledi has yet to charge users of its app, adding that it would have to apply to become a taxi service operator if it dispatches the taxis and charges people for the service.
“Our principle is that a taxi service has to be regulated by the government and the service must include motor vehicle passenger insurance. It also has to pay tax to the government,” Wang said.
If Ledi contravenes the Highway Act during the trial operation, it could face a fine of between NT$500,000 and NT$25 million, Wang said.
The ministry is also monitoring Ledi’s plan to recruit private car owners to offer a taxi service to determine it is a profit-making activity, Wang said.
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