The operator of the capital’s biggest metered taxi fleet has called on Phnom Penh municipal officials to crack down on unlicensed taxi operators, claiming as many as half of the capital’s 1,100 metered cabs are operating illegally.
Din Radeth, human resources manager for Choice Taxi, which operates a fleet of over 200 sedans under a licence from City Hall, said companies that invest in legal operations are facing cutthroat competition from unlicensed operators, who benefit from the uneven playing field.
He said metered taxi fleet operators are required to register with City Hall and pay a $2,000 monthly licensing fee to the municipality. Yet he claimed only three of the eight metered taxi firms have registered, and the unlicensed firms are benefitting from a poor regulatory framework that creates major disadvantages for compliant firms.
“Illegal companies don’t pay this fee and some even have their drivers pay the company to receive taxi licences, even though the company does not have the right to issue taxi licences in the first place,” he said. “This is a problem for the reputation of legal taxis and there has been no action from the government.”
Radeth said the lack of oversight creates a powerful incentive for taxi fleets to operate without a licence or any accountability.
“We often hear of passengers who have problems with illegal taxis and we don’t know if these companies pay for passenger and car insurance,” he said. “For legal companies, the company covers the cost of insurance.”
Radeth explained City Hall’s licences grant companies the right to operate taxis with meters, and do not apply to those companies that operate taxis with a fixed or negotiation-based fare.
“If illegal taxis remove their meters, this would make them legal,” he said.
Choice Taxi launched operations in 2009. According to Radeth, unfair competition from unregulated metered taxis almost drove the company into bankruptcy. While it has recovered, the taxi fleet operator continues to suffer financially, he said.
He also expressed frustration at seeing these unlicensed taxi fleet operators poach the company’s drivers. He said nearly a third of his drivers now work at unlicensed taxi companies, arguing that these rival firms can afford to offer higher salaries given their lower operating costs.
“In the end, we have grown the crops but others got the harvest because we also lose our experienced drivers to non-licensed taxi firms and now face a shortage of drivers within the company.”
Reached yesterday, City Hall spokesperson Mean Chanyda, said just three companies had received licences to operate metered taxi fleets in Phnom Penh, namely Choice Taxi, Airport Taxi and Great Wall Taxi.
“The government approved licences for only three taxi companies for legal business operation,” he said. “The rest are still not in compliance with the procedures of City Hall and we have reached out to them, but we still haven’t received an answer.”
He promised, however, that city officials would take action soon.
According to Chanyda, metered taxi fleet operators are required to submit an application to Phnom Penh municipality and secure approval from the Council of Ministers. Taxi Rouge, a taxi fleet operator that was not on City Hall’s list, insisted that it was licensed to operate in the capital.
General manager Kong Sarath said the Ministry of Transportation and the Ministry of Interior were involved in the taxi registration process, but could not confirm which agency had actually given the company its approval.
He agreed that taxi fleets operating without a licence were creating unfair competition, and called on authorities to take action.
“The government is working slowly on this issue but City Hall is not taking enough action,” he said. “We are not happy with this situation of illegal taxis as it affects our marketing and the current governor does not take action.”
Officials from the Ministry of Transportation and Ministry of Interior could not be reached for comment yesterday.
Additional reporting by Cheng Sokhorng