New York Council will suspend issuance of licenses to Uber drivers

The New York Council is planning to temporarily stop issuing new vehicle licenses to ridesharing services, including Uber and Lyft, for one year. The legislation will also allow the city to set a minimum wage for app-based drivers. The vote held on Wednesday by the New York Council may prevent the expansion of Uber and Lyft in the largest U.S. market for them – The Big Apple.

Thus, New York will become the first city in the country where the restrictions on the issuance of new licenses for the ridesharing services will take effect. The measure is planned to fight against traffic jams in the city and prevent a decline in the level of earnings (or even bankruptcy) for drivers of the official taxi services. Discussion of the bill took place against the backdrop of the demands of city taxi drivers to prohibit or severely restrict the services of Uber and Lyft in New York.

Uber and Lyft, in turn, were totally against the initiatives of the authorities. They argued that the suspension of issuing licenses would negatively affect inhabitants of remote areas of the city, where public transport development is not good enough. In addition, in their opinion, such a situation could lead to cost increases for Uber, Lyft and other similar companies’ services, because the demand for services in New York is only growing.

“The pause on new vehicle licenses will threaten one of the few reliable transportation options while doing nothing to fix the subways or ease congestion. Uber will do everything to cope with the growing demand,” – Uber spokeswomen Alix Anfang said.

Opponents of the legislation are defending ridesharing services. They confirm that Uber and Lyft are providing much-needed services in areas outside of Manhattan that are not served by traditional taxis. They also said that Afro-American and Hispanic New Yorkers need ridesharing apps because yellow cab drivers often won’t stop for them.

In New York the demand for ridesharing services has grown significantly in recent years. In 2015, the city had about 25,000 cars of Uber, Lyft and other similar companies. To date, the city has registered more than 80 thousand drivers of these services.

A similar cap on Uber and other ridesharing services was proposed in 2015 but did not attract enough support to pass. It is expected that Mayor of the city Bill de Blasio will sign the corresponding bill in the near future.

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