City council takes another step toward Uber regulations

Canada AM: Will Uber keep running in Toronto? MaRS' head of LegalX, Aron Solomon explains what pushing the Uber decision to 2016 means for the future of Uber in Canada.

Toronto city councillors have voted in favour of a motion to examine possible regulations for Uber drivers, after a day of heated debate.

Council began the discussion at 11 a.m. on Wednesday, and held a vote shortly before 8 p.m. about the ride-hailing service. Councillors voted 32-12 in favour of a motion from Toronto Mayor John Tory asking city staff to draft a "regulatory framework" of possible rules.

Also on Wednesday, councillors voted 24-20 to ask Uber to suspend the operation of UberX in Toronto until the spring of 2016, when the next report is to be presented.

UberX, Uber Canada's most popular service, has been operating in Toronto for a year. The service connects app users with people who own everyday vehicles who have signed up to be drivers. The service has been able to get around the city's laws, claiming that UberX is a communication service, not a cab company. As a result, drivers working for UberX don't have to purchase taxi licences or complete the required taxi training program.

The vote on suspending UberX services does not apply to Uber as a whole. Uber also operates UberXL, UberSelect, UberBlack, UberSUV and UberTaxi in Toronto.

Uber Canada executive Ian Black told reporters after the vote on Wednesday that the ride-hailing service will continue to operate in Toronto despite council's request.

"It would be remarkably off-brand for Uber to comply with any request of any city government," MaRS Innovation Lead for LegalX Aaron Solomon told CTV's Canada AM on Thursday.

"That's simply not what they do. In fact, if they were to do so, it would profoundly not resonate with Uber supporters."

During the hours-long meeting, councillors were asked to provide feedback on a Licensing and Standards Committee staff report published earlier this month.

The report recommended that ride-hailing services be subjected to the same regulations as taxis.

The report recommended updating the definition of a taxicab broker to include technology-based services such as Uber.

The service has thus far been able to get around the city's laws, claiming that Uber is a communication service, not a cab company.

The initial report suggested a UberX might fall under a newly-created licensing category, Transportation Network Companies, but the next staff report is expected to group all ground transportation together.

The Spring 2016 report will examine whether UberX drivers should be bound by the same regulations cab drivers face, such as the need for proper insurance, vehicle inspections, and background checks.

"Toronto will have a fair and modern taxi industry," Tory said after the vote on Wednesday.

The report examined Wednesday also recommended that Toronto's base rate for cab fares be reduced from $4.25 to $3.25, to better allow traditional taxis to compete with UberX drivers.

Councillors voted in favour of the rate drop, to be effective starting next month.

Though a decision on the report was made at City Hall on Wednesday, councillors' specific recommendations made during the meeting will still need to be considered by staffers.

For example, Coun. Giorgio Mammoliti asked whether municipal regulations would require Uber Canada to use vehicles 5-years-old or newer, or provide accessible and energy efficient options. He also asked whether the city would impose a base fare, the way it does on the taxi industry.

A representative for City Manager Peter Wallace said that the work that needs to be done before finalizing the report would be directly influenced by what comes out of council on Wednesday.

Toronto Mayor John Tory said any new regulations outlined in the final report would then be brought back to council for debate before they can be passed.

"My wish is to see all of those things considered as part of a process of creating a level playing field, so that you bring Uber into regulation and you reduce the regulatory requirements that are presently on taxis," he said.

Toronto city councillors voted for a crackdown on the ride-sharing service in July, saying the service gave UberX drivers an unfair advantage over cab organizations. Councillors also voted unanimously to review the city's current taxi bylaws.