Private driver service Uber and ride-sharing services Lyft and SideCar have been called to appear before the California State Public Utilities Commission.
Are the new taxi and private driver sharing services really legal? At least that’s the question raised by the California State Public Utilities Commission (CPUC), which has just called Lyft, SideCar and Uber to appear, accusing them of exploiting unlicensed drivers.
Uber’s case is different from those of SideCar and Lyft, which are ride-sharing services. Uber’s business model relies on partnerships with private driver companies that serve a community of users through drivers already licensed by the CPUC. According to TechCrunch, Uber believes it doesn’t need to be fired if its partners’ drivers are. However, the startup is facing other difficulties and is being targeted by a class action suit accusing it of unfair competition and illegally practicing the business of operating taxis. Uber says these accusations are unfounded and that it is complying with the legislation applicable to its business.
The ride-sharing services Lyft and Sidecar will have to pay 20,000 dollars in fines each for operating a commercial service without being licensed by the CPUC. The reason: the drivers are not licensed for commercial use. In their defense, they claim that they do not fall within the legal framework of the CPUC insofar as they do not own drivers or vehicles and only serve to facilitate connections and payments between users by providing them with mobile applications.