On the evening of Jan. 23, the California Department of Motor Vehicles retracted a previously released memo that required drivers operating under ride-sharing services such as Uber, Lyft and Sidecar to use commercial license plates for their vehicles.
Through a statement that was released last Friday night, officials of the DMV said that there continues to be some uncertainty regarding the effect of the regulations described in the previously released memo and of the recent changes in regulations that affect ride-sharing companies.
"We jumped the gun, and we shouldn't have," the DMV officials said in the statement, adding that the issue still needs to undergo further review and analysis that the department will immediately proceed with.
The previously released memo by the DMV this month cited the California Vehicle Code, stating that all passenger vehicles that are used or maintained to transport customers for hire, profit or compensation is classified as a commercial vehicle.
The memo added that vehicles, even when only used occasionally for such purpose, are required to undergo commercial registration, hence the need for commercial license plates.
The memo that reminded the public of the existing law regarding commercial vehicles appeared to target drivers for ride-sharing companies such as Uber and Lyft, as these drivers use their own cars that mostly have registrations as personal, private vehicles.
Certain analysts have predicted what the contents of the memo would imply for the business operations of ride-sharing companies and drivers, including further requirements such as commercial insurance. The effects would be a game-changer for the industry, which has already been facing numerous criticisms amid security and economic concerns.
The memo cited rules that were placed in effect in 2013 by the California Public Utilities Commission that regulated transport network companies, or TNCs, wherein ride-sharing companies are classified under. Those rules, along with the laws of the state of California, require drivers for TNCs to use their personal private vehicles, but without specifying whether the vehicles require to be registered as commercial vehicles.
Representatives from ride-sharing companies told the L.A. Times last Friday that they didn't think their occasional and part-time drivers should be required to register for commercial plates.
"Requiring Lyft drivers, including those who drive just a few hours a week, to get commercial plates would essentially treat peer-to-peer transportation the same as a taxi," said Lyft to Venture Beat. "[U]ndermining the thoughtful work done by the CPUC to craft new rules for ride-sharing in California."
