The Virginia DMV just issued a cease-and-desist to ostensibly illegal taxi companies, a.k.a. Uber, Lyft
posted at 6:41 pm on June 5, 2014 by Erika Johnsen
I’ve always liked living in Virginia because it’s a state that, in my humble opinion, generally has its head screwed on at least relatively straight in terms of taxes, regulations, budgets, and overall business climate. It has its flaws (and its unfortunately growing purplishness, ugh), of course, but in matters both state and municipal it typically displays plenty of good common sense.
Until now, evidently. I never imagined that we would descend to the progressive depths of France, or London, or New York City, or Washington, D.C. because of a bunch of bass-ackwards regulations that protect established businesses from good ol’ fashioned free-market competition, but here we are. This is an embarrassment.
Virginia’s Department of Motor Vehicles sent cease and desist orders today to Lyft and Uber, telling the two ride services that they must stop operating in violation of state law or face fines against their part-time drivers.
The DMV had already issued civil penalties against the companies in April — $26,000 for Uber and $9,000 for Lyft — for trips that their drivers provided in Virginia despite warnings by the state agency that Virginia law does not allow their business model. …
The DMV is studying Virginia’s motor carrier laws with an eye toward legislative changes next year that could allow Lyft and Uber to legally operate in the state. Secretary of Transportation Aubrey Layne said last week that he liked the companies’ business models, but until the law is changed, they are violating it. …
In the cease and desist letters, DMV Commissioner Richard Holcomb told representatives for both companies that he is “once again making clear” that they must stop operating in Virginia until they get the proper authority.
What, exactly, are “passenger carrier laws” — or, for that matter, any gratuitous professional licensing requirements — good for? …Not much, except imposing prohibitive regulatory burdens on entrepreneurs and innovative newcomers and thereby protecting entrenched rent-seekers as well as their higher prices. In the long run, everybody loses, and in the meantime, the DMV is trying to deprive smartphone-wielding Virginians of an excellent, efficient, and explosively popular service that allows them to avoid having to wait out on dark street corners, hastily calculate cash tips, or fight over the proffered credit card machines with shady cab drivers.
I’m disappointed in you, Virginia.