Street Vendors Act 2014: Allocating Certificates of Vending

Street vending is typically self-regulated by informal but codified norms of space allocation. Vendors, in most cases, allocate/occupy spots based on the rule of first possession. Kettles (2006) argues self-regulation brings efficiency and reduces conflicts through the identification of “valuable” revenue-generating vending sites. For the administration, such self-regulation reduces the burden to identify and allocate vending spots. More importantly, formalising existing informal practices increases compliance, reducing the need for enforcement.

In this article, we deal with a question central to urban planning: How should the Indian government, in light of the Street Vendors Act 2014, formalise and allocate rights to public spaces?

Recap of Street Vendors Act 2014
The Street Vendors Act 2014 seeks to formalize the existing space allocation to a great extent instead of allocating de novo. It attempts to formalize all existing vendors and prohibits declaring existing natural markets into no-vending zones. The Act necessitates the formation of a local governance body, called the Town Vending Committee (TVC), responsible for the regulation of vendors. The Committee is mandated to survey all vendors and issue Certificates of Vending (CoV) to all identified vendors.

The central problem is ultimately determining a method to the madness around the use of public spaces such that the interests of all parties, especially vendors, are met. Put another way, this requires some process to determine and assign user rights to vendors.

Formalising vendors will require formalising usufructuary vending rights
The Act approaches the question of assigning property rights, particularly user rights to a particular spot, to vendors in conflicting terms. On the one hand, Section 29(1) expressly declares that the Act confers no “temporary, permanent or perpetual right of carrying out vending activities in the vending zones allotted to him or in respect of any place on which he carries on such vending activity.”

On the other hand, section 5(1)(c), for example, mentions a condition of non-transferability for the issuance of CoV. This condition prohibits the transfer of CoV, rent or even the place specified in the CoV to any other person. It implies that the place of vending is ‘specific’ and it is to be specified in the CoV.

Three aspects of implementation require careful attention
First, while the Act protects existing vendors by requiring local governments to accommodate them until the upper limit of 2.5% of the local population is reached, it leaves the determination of holding capacity, applicable to new vendors, to the local authority. The principles the state government lays out in determining the formula for calculating holding capacity will determine how inclusive or accommodative the local government will be of new vendors.

Second, if the demand for CoV from existing vendors and new applicants exceeds the holding capacity, the Act suggests carrying out a draw of lots. While section 4(3) of the Act seems to equate existing and new vendors, we recommend prioritising existing vendors over new applicants. The manner in which state governments balance the demands of existing and new applicants, especially when it exceeds holding capacity and 2.5% of the population, has implications on vendor livelihoods and urban space management.

Third, the Act is ambiguous on whether or not to assign property rights to a specific spot to a vendor. There may be different ways to approach this: allocation of exclusive rights to a site to the vendor, allocation on the time-sharing basis (in a day, month, or season) or allocation of an area without specifying the vending site. Each of these policy choices has pros and cons, and has a bearing on the degree of vendor formalisation.