Court rules Prague taxis can charge more

For years Prague City Hall has been doing battle with the city's taxi drivers, whose reputation for overcharging passengers has become blight on the city's name. Now that battle has taken a new turn. A Prague court has ruled that taxi drivers do not have to respect a maximum fare per kilometre set by the city's authorities.

Another chapter has been written in the chronicles of notorious taxi services in Prague. On Thursday, the Prague municipal court ruled that a taxi company which was charging 90 crowns, or 4.5 U.S. dollars, per kilometre, can legally do so; that is despite the fact the charge is more than three times higher than the maximum price introduced by Prague City Hall. After the taxi company was fined in 2005 by local authorities, it appealed to the Finance Ministry which confirmed the penalty. The taxi providers countered with a lawsuit against the Ministry's decision, and the court said they were right. Kolja Kubicek was the taxi company's attorney in the case.

"The ruling is nothing else but a confirmation of the fact that taxi drivers can set their prices themselves and that they do not have to follow the City Hall's regulations. This ruling opens the door for free price calculations and that's why it is a break-through decision."

Prague City Hall has introduced a maximum charge of 28 crowns (1.4 U.S. dollars) per kilometre. The court now said this is illegal because a regulation issued by the City Hall cannot be superior to the law. Tomio Okamura of the Association of Travel Agencies of the Czech Republic.

"We absolutely don't agree with the court's ruling. The act on prices allows for regulation only when the market is endangered by the effects of competition, or in extraordinary cases. We believe, however, that this is an extraordinary case. The court did not take into account the significance of the issue of taxi services for the development of tourism in Prague."

In Prague alone, an estimated 20 percent of all jobs are related to the tourist industry and tourism makes up for about four percent of Czech GDP, which is more than agriculture. This indeed appears to be sufficient argument, in Mr Okamura's opinion, to regard taxi services as a special case. Even the taxi company's attorney says that the ruling could harm tourism in the Czech capital.

"The ruling that we are talking about supports the free market and the free setting of prices. It would be a good ruling if it concerned another matter. But in the matter of providing transparent taxi services, the ruling is not the best move."

The case now goes back to the Finance Ministry, which will have to make sure that city regulations do not contradict Czech law on the free calculation of prices. But ultimately it is up to Prague City Hall to come up with such a provision that would not go against the principles of market economy and at the same time make sure that visitors to Prague will not end up as prey for ruthless taxi drivers. After 18 years of fruitless efforts, it would be just about time.