Prime Minister Nguyen Tan Dung has approved a proposal from the Ministry of Transport that forces Uber Vietnam to sign contracts with licensed transport companies as a condition for its operation in the country.
Under the proposal, the novel cab-hailing service must work with transport companies that have been licensed by Vietnamese authorities and comply with the country's operational standards.
This means Uber are not allowed to partner with independent drivers in the country.
The transport ministry said random inspections will be launched to periodically check the operations of these transportation companies. If the companies fail to meet the requirements, they, and Uber as well, will face penalties.
The ministry also asked the Ministry of Finance, the Ministry of Industry and Trade, the State Bank of Vietnam and relevant agencies to facilitate the operation of Uber.
Previously, the HCMC Taxi Association had petitioned the Ministry of Transport and the government to halt the business of Uber in Vietnam until the company complies with Vietnamese laws.
It said the company was licensed as a management consultant and market research firm but in fact it operated as a transport service provider with thousands of drivers in HCMC.
All Uber taxis were unlicensed, it said.
Early this year, HCMC traffic inspectors launched some sweeps targeting Uber taxis that lacked proper signage, two-way radios and meters and fined dozens of drivers.