In Kazakhstan, a draft law is being considered that could radically change the taxi market. The document proposes the creation of mandatory Motor Carrier Chambers for all carriers, with broad powers ranging from setting tariffs to collecting membership fees.
The Ministry of Transport, for its part, is currently proposing to launch a pilot project. Experts warn that good intentions to regulate the industry could lead to price rises, a deterioration in service quality, and businesses moving into the shadows.
The draft law "On introducing amendments and additions to certain legislative acts of the Republic of Kazakhstan regarding the transfer of certain state functions in the field of road transport and passengers to self-regulation" was withdrawn after its first reading in Parliament thanks to the balanced position of MPs and returned to the Ministry of Transport for a pilot project.
The key idea of the draft law is the creation of self-regulatory organisations (SROs) in the form of Motor Carrier Chambers, membership of which would have been mandatory for all market participants. However, market participants note that there is no need for a pilot, as the existing system already works effectively.
The proposed changes are causing serious concern among experts and market participants.
Firstly, the draft law unjustifiably combines taxis and public transport into one category, creating a clear conflict of interest. Given the size of the subsidies received by bus carriers in 2024, there is a risk that less efficient businesses will parasitise the more successful ones, which contradicts the principles of a market economy and will inevitably lead to higher tariffs.
Secondly, the draft law imposes atypical control functions on market participants over other market participants. It fails to consider that aggregators use different business models: InDrive takes its commission upfront and dominates the intercity transport segment, while Yandex and Apara have other working approaches. Moreover, all aggregators are IT companies, not carriers.
Thirdly, granting SROs the right to set criteria for market entry creates grounds for abuse — participants who fail to see eye-to-eye with the association's leadership risk being locked out of the legal business.
Fourthly, the Chambers would gain the right to set tariffs for transport. However, such price regulation contradicts the Entrepreneurial Code of the Republic of Kazakhstan, where road transport is not included in the list of areas with regulated pricing.
Another controversial point is compulsory membership fees. For owners of taxi depots, these would amount to between 1.2 and 9.4 million tenge per year, and for aggregators, between 14.1 and 33 million tenge. According to the head of the Taxi Association of the Republic of Kazakhstan, Zhenis Mukhiyev, the fees will inevitably lead to higher costs for passengers.
Taxi depots or drivers will not take this money from their income – all additional costs will be passed on to the cost of a journey. Meanwhile, despite the Ministry of Transport's promises of minimal membership fees, there are no guarantees that they will not be significantly increased after the SROs are established.
At the same time, financial analyst Arman Beisembayev warns of serious risks of market monopolisation. In his words, government attempts to regulate prices contrary to basic market principles could lead to the destruction of the market or a mass exodus of participants.
As an example, the expert cites the situation in the mobile communications market, where the unification of operators under a single management led to price increases and a decline in service quality.
This is particularly worrying given that the country cannot even get to grips with individual cases of Common Property Management Bodies within a single residential complex – so how can self-regulation of an entire transport industry be entrusted?
Experts also point to a potential threat of price collusion, as granting the Chambers the authority to set tariffs may contradict antitrust legislation.
The editorial board of the FB RK has sent official requests to a number of state bodies for clarification on this matter.
How does similar regulation work in other countries? In the next part of this article, we will look at the experience of Turkey, where self-regulation of the taxi market has existed for almost 60 years.
We will examine the results of the activities of the Istanbul Chamber of Taxi Drivers, the problems that have arisen in the industry, and what lessons Kazakhstan can learn from the Turkish experience.
To be continued…