LTA suspends Ofo's operating licence, bikes to be removed from public spaces

LTA suspends Ofo's operating licence, bikes to be removed from public spaces

Ofo bicycles file
File photo of ofo bicycles. (Photo: AFP/Eric Piermont)

SINGAPORE: The Land Transport Authority (LTA) has suspended Chinese bike-sharing company Ofo's operating licence in Singapore, it said on Thursday (Feb 14). 

"Despite previous communications with ofo to comply with the regulatory requirements by Feb 13, 2019, ofo has failed to comply with these requirements, including proper implementation of the QR code system," said LTA. 

LTA had said in a statement last month that the firm was in danger of suspension after it "breached multiple regulatory requirements" despite being given enough time to comply.

READ: Ofo has 'practically ceased' operations, sacked employees say

In addition to not ensuring that its bicycles were parked within designated areas by using a QR-code system, Ofo had also failed to reduce its bicycle fleet to the stipulated maximum size of 10,000 despite multiple warnings. 

Channel NewsAsia reported two weeks ago that Ofo had terminated all its employees in Singapore by the end of January. 

It was also reported last month that Ofo owes at least two of its former logistic vendors around S$700,000 for their services.

REMOVAL OF BICYCLES

LTA said that Ofo will be required to remove all its bicycles from public places by Mar 13.

"If ofo fails to remove the bicycles in time, LTA will take the necessary regulatory action, including possible cancellation of ofo’s licence," said the authority in response to Channel NewsAsia's queries.

LTA added that it will step in "as a last resort" from Mar 14 if necessary, to ensure that the bicycles do not clutter public spaces.

"The primary responsibility for managing the bicycles lies with the respective operator. To manage taxpayer burden, LTA only steps in where necessary," it added.

The suspension will only be lifted if the company meets all regulatory requirements, LTA said, adding that it will continue to monitor the company's efforts to comply and may cancel its licence if does not show satisfactory progress. 

Last December, Ofo's chief executive Dai Wei said the start-up backed by Alibaba Group Holding was facing "immense" cash flow problems

READ: China bike-sharing firm Ofo faces "immense" cash crunch, CEO vows to battle on

"The whole of this year we've borne immense cash flow pressures. Returning deposits to users, paying debts to suppliers and keeping operations running," Dai Wei said in a letter posted on social media by Ofo's head of public relations. 

However, Dai, who is also Ofo's founder, said he was determined to keep the company afloat. 

"As pressures mount we must endure, as difficulties grow we must find ways to overcome them," he said in the letter dated Dec 19.

At its peak, Ofo had bike fleets in more than 20 countries, from France to Australia and the United States.

Source: CNA/hs(hm)

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