FTC sides with Uber in DC taxi fight

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As the applications-based car companies have risen in popularity in recent years, they have complained that regulators in D.C. and other cities have singled them out with harsh, overly restrictive burdens.

In May, Uber claimed in a blog post that the District's regulations "are unprecedented and far more restrictive than Uber has seen in any of the 30 cities that we operate in," and that it could prevent the company from using regular taxis as well as the luxury cars.

“The FTC has recognized that there are serious problems with the DC Taxi Commission’s proposed regulations that would limit consumer choice in the District and impose unprecedented technological barriers,"  Rachel Holt, Uber DC General Manager, said in a statement on Wednesday. "It’s time for the DCTC to listen to the overwhelming opinion of the DC Council, District residents, and the FTC, and to stop trying to hamstring innovative transportation options like Uber."

The taxi commission argues that the rules are intended to protect public safety, benefit consumers and ensure competition in the marketplace.

"The D.C. Taxicab Commission appreciates the comments from the FTC," said Neville Waters, the commission's public information officer. "We will carefully study them as we continue to review and revise these proposed regulations."

The FTC, which handles consumer protection and fair competition issues, pushed the taxi commission to "allow for flexibility and experimentation" with its restriction on the ability of smartphone users to hail regular city cabs. 

"We note that this restriction does not appear to be related to any evident concern with safety or consumer protection and that its rationale is not obvious," the FTC wrote. 

The agency also criticized a proposal that would require sedans to be at least 3,200 pounds, warning the rule could bar light-weight eco-friendly vehicles. 

The D.C. taxi commission's proposal would require that all car companies get pre-approval for any "substantial change"  in their dispatch or payment systems. The FTC warned the requirement could "unnecessarily burden" smartphone apps by preventing them from regularly updating their software. 

"By their nature, applications are very likely to seek to update and upgrade their software on a periodic or sometimes more frequent basis, as, for example, by adding additional features and services, improving data security, or otherwise improving the software," the federal agency wrote.

The FTC also expressed concern about a requirement that companies share ride information with the D.C. agency every 24 hours, saying it "may raise data security issues" and could "unnecessarily impede competition."

The FTC did not address one of Uber's main complaints—that it is impractical for software companies to comply with D.C. rules requiring that payment systems be integrated into a cab's meter system. 

-- This story was updated with comment from the D.C. Taxicab Commission at 6:01 p.m.