Uber, Other Rideshare Services Caught In Regulatory Backup

Cameron Aubernon
by Cameron Aubernon
uber other rideshare services caught in regulatory backup

Ridesharing services such as Uber, Lyft and Sidecar have gained traction among those who prefer using their smartphones to hail a ride to the airport over traditional black car or taxi service. However, in locales such as Detroit, Atlanta and Seattle, such services are rolling up upon a regulatory traffic jam over how best to handle the disruption in the livery industry.

The issues at hand, as noted by Detroit Free Press, GeekWire and The Daily Caller, include surge-pricing (taxi and limo operators can only charge a constant fare at all times), Uber’s introduction of UberX, where customers can hail a lift from a driver using their personal vehicle (Uber’s standard service utilizes those with hack licenses), mandating commercial insurance for UberX drivers, who only have personal-grade policies for their vehicles, and whether or not Uber and companies like it are solely tech companies or transportation providers in determining what regulations apply.

In Detroit, state and city officials have demanded Uber to register with MDOT as a limo carrier while requiring UberX drivers to obtain a $300 Certificate of Authority and $110 limo operator’s license to be in compliance with current law, neither of which has happened thus far. Officials in Georgia, however, aim to take regulation of the nascent reinvention further with Georgia House Bill 907. The bill not only brings Uber et al in line with everyone else, but as far as using apps to request rides are concerned:

The use of Internet or cellular telephone software to calculate rates shall not be permitted unless such software companies complies with and conforms to the weights and measures standards of the local government that licenses such taxi service.

Washington State’s House Bill 2782, on the other hand, aims to help level the playing field through a more sane approach:

The legislature finds that Washingtonians are early adopters of technology and have come to rely on services provided by mobile application-based personal transportation services. The legislature further finds that a piecemeal approach to regulating such services could result in a patchwork of conflicting standards, stifle innovation, and reduce consumer choice.

The enacted bill would allow for a study to be conducted by the end of 2014, with a framework established the following year. The framework, according to Washington Policy Center director Bob Pishue, would supercede local regulations such as those the Seattle City Council would like to impose upon Uber et al, and that HB2782 is focused on the consumer than on the taxi companies.

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  • Chug Chug on Feb 17, 2014

    Rent seeking or not, this is an important point about UberX: "mandating commercial insurance for UberX drivers, who only have personal-grade policies for their vehicles," As soon as an UberX driver with only a personal auto policy is in a crash or is sued, what do you believe the insurer is going to do? Cancel, as most "personal policies" do not cover commercial use such as UberX. Contrast to Lyft, which appears to provide its drivers with some kind of coverage. UberX drivers seem to be skating on thin ice, insurance wise. YMMV. PS. I do not have a dog in this fight.

  • Mopar4wd Mopar4wd on Feb 17, 2014

    It would seem that requiring insurance and a business license to operate a livery vehicle should be mandatory. I wouldn't view that as protectionism more or less just common sense. Really it's just everyone playing by the same rules. Now you ban obviously take that too far.

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  • Redapple2 Hope they fix the:1 ride. worse than a corvette2 seating position. ankles at the height of my butt is UNCOMFORTABLE .As is. Horrible truck