China imposes harsh fines on Uber-like services

The fate of taxi-hailing apps like Didi Dache, Kuaidi Dache, and Uber is now less certain in China as regulators in major Chinese cities are stepping up penalties on illegal taxi activities.

While taxi-hailing apps are pushing for a legitimate identity in China, Shanghai local authorities have enhanced fines on both drivers and companies providing such services.

Drivers in Shanghai who utilize Didi Dache and Kuaidi Dache -- two most popular taxi-hailing apps in China backed by Internet giants Tencent and Alibaba -- as well as Uber to provide taxi services, now face penalties including 10,000 yuan ($1,611) fines and suspension of driver's license for three to six months, according to a Sina news report on Thursday.

Personal information of these drivers will also be shared with other government departments and the Shanghai Credit Information Platform, which will affect the life and work of these drivers as their credit record will become marred.

In the meanwhile, taxi-hailing app platforms will be fined 100,000 yuan for each case.

These apps have severely affected the business of traditional taxi companies in China as these new comers charge much less and thought of as providing even better service to the passengers. But regulators have deemed these services illegal in the country as these platforms have yet obtained any operation licenses from government.

In another Chinese news report last week, a private-car driver who was trying to pick up a passenger in the airport via Uber, was seized by traffic enforcement officers. The passenger admitted she didn't know the driver, and other taxi-hailing histories were also found on the mobile phone of the driver.

The traffic enforcement department detained the vehicle for further investigation, according to the report, which indicated the driver will face a 10,000 yuan fine and suspension of driver's license for three to six months, once the case was deemed "illegal operation" by the authority.