Taxi aggregators such as Uber and Ola may no longer be able to raise fares arbitrarily in times of higher demand as the centre is bringing app-based taxi services under a regulatory network that would allow state governments to fix a fare cap, reports the Hindustan Times.

The report quoted a road ministry official who said that once there is a fare cap, aggregators will have to keep the surge pricing within the range that has been fixed. It added that the ministry is looking to rework on the licensing norms and introduce a new category to cover aggregators.

As per the Motor Vehicle (Amendment) Bill, 2016, that has been passed by the cabinet, aggregators violating licencing conditions can be fined anywhere between Rs 25,000 and Rs 1 lakh.

“It will also be mandatory for such taxis to get city permits, which makes a fare meter a must. These taxis operate on an all India tourist permit that doesn’t require a meter,” the report added.

“The road ministry’s proposal to bring in a new category will ensure that services that have direct interface with the public do not go unregulated,” an official told the paper.