ew legislation by the Punjab government mandates district- and platform-specific permits for app-based ride-hailing vehicles. Designed for improved safety and oversight, these regulations impose heavy financial burden on drivers, which experts warn, could soon trigger higher fares for commuters.

While conventional taxis and auto-rickshaws have operated under statutory route permit requirements for decades, the ride-hailing sector continued in the Punjab without a dedicated regulatory framework. A recent amendment to the Punjab Motor Vehicles Ordinance, 1965, — enacted through Section 44B of the Punjab Motor Vehicles (Amendment) Act, 2025, — brings digital mobility services into the provincial permit framework. Officials say the move formally brings Transport Network Companies under state regulation for the first time in Lahore and across the province.

Under the new law, every vehicle operating on a ride-hailing app must hold a route permit issued by the Regional Transport Authority, renewable annually under a notified fee schedule.

A driver operating across district boundaries, or working on more than one app simultaneously, must obtain a separate permit for each district traversed and each platform used.

For drivers, this creates an operational paradox. “A district-bound permit assumes that a vehicle’s operating area is fixed and known in advance,” says one ride-hailing driver. “If a driver travels from Lahore to Rawalpindi, they aren’t just required to get a permit for the destination, but for every single district along the way.”

The Punjab comprises 41 districts, and rides in large metropolitan regions routinely cross district boundaries multiple times a day. As per the amendment, a driver entering a new district without the corresponding permit becomes technically non-compliant mid-trip, regardless of where the ride originated.

Commuters are also expressing concern. While many this scribe spoke to seemed to welcome the measures aimed at enhancing safety, frequent travellers feared the financial burden would inevitably fall on them.

“Every time fuel prices go up, ride-hailing platforms pass the cost to the passenger,” said a frequent inter-district business traveller. “Regulatory fees will be no different.”

The financial implications are compounded by the fact that permits are charged per district and per platform. This comes at a time when the working class is already struggling with high fuel prices and currency depreciation.

When quizzed, the Transport and Mass-transit Department at the Punjab Secretariat clarified that all vehicles operating under TNCs (such as Bykea, Yango and InDrive) fall under the category of commercial vehicles for hire (CVH) or private vehicles for hire (PVH) — operating through the digital platform for passenger transportation (DPPT) — and are treated legally as “contract carriages.”

According to the department, mandatory route permits under Section 44B serve a broad traffic management purpose: “When a transport vehicle is granted a permit for a specific route, traffic load remains under control. If the requirement of a route permit is done away with, transport vehicles will ply any route without a check and that will cause traffic congestion on more profitable routes.”

The secretariat further stated that obtaining a route permit required a Vehicle Fitness Certificate under Sections 39 and 39-A of the PMVO 1965 to ensure roadworthiness. Additionally, vehicle insurance is required to guarantee financial compensation for passengers in the event of fatal accidents, pursuant to Section 49(2)(c). Under Section 2(5) and Section 53-A of the ordinance, a contract-carriage permit covers a specified region or district rather than a single fixed road. Therefore, a separate permit is required for every district traversed between the origin and destination.

As for the updated fee schedule under PMVO 1979, drivers face an application fee of Rs 650 (Rule 64-2) and a base route permit fee of Rs 850 (including the first district) under Rule 71(1), along with an additional Rs 100 per extra district. Total baseline costs for obtaining a standard permit start around Rs 1,500 before accounting for multi-district or multi-app expansion.

“The intent is oversight of operations and guaranteeing road/ passenger safety — not generation of revenue,” Minister Bilal Akbar Khan told TNS.

Transport operators and industry experts say that the mechanism is overly complex. They advocate for a simpler alternative: a single, province-wide permit linked directly to a TNC platform’s registration with the Provincial Transport Authority.

Such a system, they argue, will preserve state oversight, driver accountability and safety compliance without creating a bureaucratic logjam. “The structure needs to change because it places an unreasonable burden on drivers,” says a transport operator, requesting anonymity. “Left unchanged, it risks becoming a compliance nightmare that pushes marginal drivers back into the informal economy, defeating the very purpose of the law.”

Amer Malik is a senior reporter at The News