India recommends banning unregistered Web taxis in light of Uber case

Home Minister Rajnath Singh told Parliament on Tuesday that his ministry had advised local governments to ensure that the operations of Web-based taxi services are stopped until they get themselves registered with the local administrations.

It isn't clear yet how many states are likely to go ahead with bans of the Web-based services, which have been expanding in various cities and are now a key mode of transport for some people.

On Monday, the Delhi Transport Department had already banned Uber from operation in Delhi for violation of its rules, and followed up with a prohibition on unregistered Web-based taxi services. But on Tuesday, Uber was still operating in Delhi, according to reports. Uber did not immediately comment.

The Delhi Police is also checking on the possible legal liability of Uber in the alleged rape over the weekend, Singh said. Madhur Verma, Delhi deputy police commissioner, said the police was investigating whether Uber was negligent in checking the background of the driver, and if it had a GPS system in the car.

The driver had GPS on his mobile phone which was switched off by him to evade detection and arrest, Verma said.

Uber said in a statement Sunday that it partners exclusively with registered for-hire drivers "who have undergone the commercial licensing process, hold government issued IDs, state-issued permits, and carry full commercial insurance." It said it had provided the driver's details on its records and other information to the authorities.

In an interview to the Wall Street Journal last month, an Uber executive said it does not do background checks of its drivers, counting instead on government checks of drivers at the time of issuing commercial permits.

On Monday, Uber CEO Travis Kalanick appeared to blame the government for an improper background check of the driver involved in the alleged rape. Kalanick said the company will work with the government "to establish clear background checks currently absent in their commercial transportation licensing programs," according to a statement.

Uber may be largely a victim of its own image. Background checks in India are notoriously inadequate and the Uber incident is not the first time that a driver has raped a woman passenger. In 2005, for example, a business process outsourcing employee in Bangalore was raped and killed by a taxi driver. "We expect better from Uber," said a woman customer of Uber who declined to be named.

The company's problems may, however, be compounded by the claim of a woman that she had reported the driver in November for staring and smiling at her, and Uber had promised to check on him. The driver is also said to have been arrested for sexual assault charges in 2011.

Uber's troubles are not confined to India. In California, Uber faces a lawsuit by the district attorneys for Los Angeles and San Francisco, accusing it of misleading consumers over its background checks on drivers. Rival Lyft entered into a settlement agreement with the district attorneys over similar charges, they said Tuesday.

Uber services were also banned in Spain by a court in Madrid after a complaint from the Madrid taxi association. The services were banned because Uber drivers have no license and no insurance, which constitutes unfair competition for the licensed taxi drivers, the court ruled.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com