Updated at 6:32 p.m. PT with Lyft’s response.
Alternative-cab service Lyft just hit a big regulatory red light on its way into New York City.
The city’s Taxi & Limousine Commission issued a statement today saying Lyft is not authorized to have its drivers picking up passengers through the mobile app-enabled service. The announcement comes just a day after Lyft announced plans to do as much.
“Lyft has not complied with TLC’s safety requirements and other licensing criteria to verify the integrity and qualifications of the drivers or vehicles used in their service, and Lyft does not hold a license to dispatch cars to pick up passengers,” the commission said in the statement, according to the New York Times. Lyft drivers could be fined as much as $2,000 “for unlicensed activity,” according to the statement.
In response, Lyft issued a “New York Safety Commitment” (see below), vowing to impose vehicle standards, rules on alcohol use, and other practices. The company will “continue to work with all stakeholders to create a path forward,” a Lyft spokeswoman wrote in an email to VentureBeat.
Lyft has been growing quickly as of late, following its $250 million funding round in April.
But it’s still in the shadow of Uber, which is popular in New York City and has previously received regulatory clearance from the T&LC. (“All of Uber’s current transportation options meet TLC requirements for licensing, insurance and driver screening,” an Uber spokeswoman wrote in an email to VentureBeat. “Due to TLC regulations Uber does not currently have a ridesharing platform in New York. If regulators embrace ridesharing with a relaxed approach to licensing and enforcement with other companies, Uber will be excited to launch our ridesharing platform soon in the state of New York.”)
A representative of the T&LC did not immediately respond to VentureBeat’s request for comment.
Read Lyft’s “New York Safety Commitment” below:
Lyft is the latest evolution of mobile-based ridesharing — a friendly, safe, and affordable transportation option that matches people who need rides with people who have cars.
As industry pioneers setting the gold-standard for safety and designing every part of Lyft with safety front of mind, we commit to:
- Prior to permitting a person to act as a driver on its digital network, Lyft will obtain and review a criminal history report for such person. The criminal history check will be a national criminal history check including the national sex offender database. A person with disqualifying convictions will not be permitted driver access to the Lyft network.
- Prior to permitting a person to act as a driver on its network, and quarterly thereafter, Lyft will obtain and review a driving history report for such person. A person with disqualifying traffic violations will not be permitted driver access to the Lyft network.
- Drivers on the Lyft network will adhere to state insurance requirements and Lyft will maintain a business automobile excess liability insurance policy, which covers all vehicles operated by drivers on the Lyft network, with a minimum combined single limit of one million dollars for each occurrence of bodily injury and property damage for accidents involving a vehicle and Lyft operator in transit to or during a trip.
- Lyft will implement a zero tolerance policy on the use of drugs or alcohol applicable to any driver on the Lyft network, provide notice of the zero tolerance policy on its website, as well as the procedures to report a complaint about a driver with whom the passenger was matched and for whom the passenger reasonably suspects was under the influence of drugs or alcohol during the course of the ride, and immediately suspend said driver upon receipt of a passenger complaint alleging a violation of the zero tolerance policy. The suspension will last the duration of the investigation.
- All vehicles on the Lyft network will be of model year 2000 or newer and pass a 19-point safety inspection conducted annually by Lyft or a third party before being used to provide a service.
- Drivers on the Lyft network will accept only rides prearranged through the Lyft mobile application and will not solicit or accept street-hails.
- Lyft will maintain a 24/7 support team available via telephone and email and trained to assist both drivers and passengers.
- Lyft will maintain a driver-training program designed to ensure that each driver safely operates his or her vehicle prior to the driver being able to offer service.
- To keep community standards high, the Lyft mobile application will allow passengers and drivers to each provide feedback on a 5-star scale after every ride. If either party rates their match 3-stars or lower, they will never be matched again. If a driver’s average feedback falls below 4.6 out of 5 stars, that driver will no longer be permitted driver access to the Lyft network.