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    HomeGovernance, Policy & Regulations ForumPolicy & Regulations ForumTaxi Unions, Vested Interests — The Hidden Risks of Scaling Ride-Hailing Apps Too Fast...

    Taxi Unions, Vested Interests — The Hidden Risks of Scaling Ride-Hailing Apps Too Fast in North Africa

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    Just six years after its launch in Tunisia, the Estonian ride-hailing giant Bolt finds itself in the crosshairs of the government, its operations abruptly suspended amidst a swirling vortex of allegations. The accusations, ranging from money laundering and tax evasion to operating without proper licenses, have led to the seizure of millions in assets and the closure of the company’s headquarters. For Bolt, a company boasting a global footprint across 50 countries and a recent valuation soaring to €2 billion, this dramatic turn of events in a relatively small North African market serves as a stark reminder of the intricate and often treacherous path of expansion in emerging economies.

    Bolt’s entry into Tunisia in 2019 was initially met with enthusiasm. The platform quickly gained traction in urban centers like Tunis, Sfax, and Sousse, where the existing public transport infrastructure often struggled to keep pace with the demands of a burgeoning population. By early 2025, Bolt proudly announced a substantial investment of 34 million Tunisian dinars (approximately €10 million), claiming to have empowered over 5,000 local drivers and become an essential transportation option for millions of Tunisians. Surveys commissioned by Bolt painted a rosy picture, highlighting how users valued the service as a complement to public transport, improving accessibility and saving commuters valuable time.

    Yet, beneath this veneer of success, regulatory storm clouds were gathering. As early as October 2022, the Tunisian National Authority for the Protection of Personal Data (INPDP) filed a complaint against Bolt for alleged violations of the Personal Data Act, citing the company’s failure to “regularize its situation.” This foreshadowed a growing unease within Tunisian authorities regarding Bolt’s operational practices.

    The recent suspension, announced by the Interior Ministry, points to a more serious set of alleged infractions. The National Guard, leading the investigation, claims Bolt and other unnamed companies operated without the necessary legal licenses, relied on “false authorisations,” and maintained undeclared bank accounts to illicitly transfer significant sums abroad. While Bolt has yet to issue a detailed public response to these specific allegations, the sheer scale of the investigation and the swift action taken by Tunisian authorities suggest a deep-seated concern about the company’s compliance with local regulations.

    The Tunisian saga raises a crucial question: was Bolt’s rapid expansion across major cities (Tunis, Sousse, Sfax, and the later additions of Nabeul and Monastir) just six years after launch an act of overambition? While Bolt’s CEO for Tunisia, Salima Mekki, consistently emphasized the company’s commitment to the local market and its willingness to collaborate with stakeholders, the current situation suggests a potential disconnect between these pronouncements and the reality of navigating Tunisia’s complex regulatory landscape.

    The challenges faced by Bolt in Tunisia are not isolated incidents in North Africa. The region, encompassing Morocco, Tunisia, and Algeria, presents a unique set of hurdles for ride-hailing companies seeking to replicate the success they’ve found in other parts of the world.

    In Morocco, the ride-hailing graveyard is already quite full. Uber, a global behemoth, ceased operations in the country in 2018 after years of battling legal and operational obstacles. More recently, Morocco’s Casablanca-Settat region declared the operations of Algerian startup Yassir illegal due to a lack of proper authorization. Even Yango, a relatively new entrant, also found itself accused of flouting local laws by operating without the necessary permits and employing unlicensed vehicles. The Moroccan authorities have made it clear: ride-hailing companies must operate exclusively through registered taxi unions, a model that Heetch, a French startup, successfully adopted by collaborating with major driver unions before its entry.

    The core issue in Morocco, and likely a contributing factor to Bolt’s troubles in Tunisia, lies in the delicate balance between embracing technological innovation and protecting the livelihoods of traditional taxi drivers. The rise of ride-hailing apps has often led to tensions, with taxi drivers protesting against what they perceive as unfair competition from companies operating outside the established regulatory framework. In Casablanca, this friction has even resulted in reports of harassment and violence against ride-share app users.

    The general trend across North Africa indicates a cautious approach by governments, keen to maintain control over the public transport sector and address the concerns of established players.

    The lessons emerging from Bolt’s predicament and the wider experiences of ride-hailing companies in North Africa are stark. Successfully operating in North Africa requires strict regulatory compliance, as governments prioritize adherence to laws over rapid expansion. Companies must invest in understanding each country’s unique legal, cultural, and political landscape rather than applying a uniform strategy. Building strong relationships with government authorities, taxi unions, and local communities is crucial for overcoming challenges. A sustainable, measured approach — focusing on fewer cities with full compliance before expanding — reduces risks. Additionally, maintaining transparency in financial practices is essential to avoid reputational damage and build trust with both authorities and the public.

    Bolt’s ambition to rapidly expand its footprint in Tunisia, while seemingly driven by a desire to meet a genuine need for improved urban mobility, appears to have outpaced its ability to navigate a landscape riddled with vested interests and intricate regulatory boobytraps. The current investigation serves as a harsh reminder that in North Africa, the road to success for ride-hailing companies is paved not just with technological innovation but also with meticulous attention to local laws, a calculated ‘sniffing-out’ of local nuances, and a commitment to building trust with the authorities and the communities they serve. As Bolt grapples with the fallout in Tunisia, its experience will undoubtedly serve as an exemplary tale for other e-hailing hopefuls eyeing the potential of the Maghreb. The future of ride-hailing in the region hinges on finding a delicate balance between technological progress, regulatory oversight, and the protection of established livelihoods.

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