The state of Virginia is none too happy at on-demand car services Uber and Lyft operating, in its mind, outside the framework of its passenger carrier laws.
The state's Department of Motor Vehicles has sent out two cease and desist letters, one to Uber and one to Lyft, demanding that both companies stop operating in the commonwealth of Virginia until they "obtain proper authority."
The DMV is threatening to fine Uber and Lyft drivers. It wouldn't be the first fines the Virginia DMV has handed Uber or Lyft, as they assessed civil penalties earlier this year. Uber and Lyft, naturally, contend that they are not taxi services, but ride-sharing companies.
"Virginia law requires for-hire passenger carriers to have proper operating authority. Although certain types of passenger carrier arrangements are excluded from this requirement, none of those exclusions applies to Lyft's operations. For example, Va. Code 46.2-2000.1 contains an exclusion for ride-sharing arrangements; however, a separate statute sets out the requirements for ride-sharing arrangements. This statute defines ride-sharing arrangements as those which do not involve transporting passengers for profit. See Va. Code 46.2-1400, et seq. Lyft's operations are not ridesharing arrangements as defined in Virginia law because Lyft receives compensation for its services.
The letter sent to Uber says the exact same thing.
A spokesperson for Uber calls the Virginia DMV's actions "shocking and unexpected."
"The DMV’s actions today are shocking and unexpected. Uber has been providing Virginians with safe, affordable and reliable transportation options for months and has continued to work in good faith with the DMV to create a regulatory framework for ridesharing. The DMV decision today hurts thousands of small business entrepreneurs who rely on the Uber platform to make a living, create new jobs and contribute to the economy – and it hurts the countless residents who rely on Uber to connect them with affordable, safe and reliable transportation alternatives. We look forward to continuing to work with the Virginia DMV to find a permanent home for ridesharing in the Commonwealth," says Uber's Natalia Montalvo.
A Lyft spokesperson echoed Uber's sentiments on safety.
"The current regulations surrounding taxis and limos were created before something like Lyft was even imagined," a Lyft spokesperson told WVEC. "Lyft’s peer-to-peer business model does not easily fit into the current framework, but we have made safety a top priority from the beginning by putting forth strict safety measures that go beyond what is required for existing transportation providers."
At the end of the letters to both Uber and Lyft, the Virginia DMV makes a suggestion to the companies:
"As you know, DMV is actively studying Virginia's passenger carrier laws and business models such as Uber/Lyft. DMV has invited Uber/Lyft and other stakeholders to participate in this study and will produce a final report before the next legislative session. I strongly suggest that Uber/Lyft focus its resources on participation in this study rather than continue illegal operations in the meantime.
In other words, get your lobbying pants on boys, and head to Richmond.
Here's the most telling aspect of this story, via Watchdog.org:
Sunni Blevins Brown, spokeswoman for the Virginia DMV, confirmed that a “number of transportation companies, including taxis, have contacted DMV regarding this matter.
Of course they have.
Lord knows ride-sharing companies, especially Uber, have a lot of 'splainin to do in other areas of their business model, but it's hard to look at the DMV's action as anything but a transparent move to protect the old guard.
Image via Lyft, Twitter