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Big win for Uber, New York backs down

Posted at 7:39 PM, Jul 22, 2015
and last updated 2015-07-22 19:39:11-04

NEW YORK — In a big win for Uber, Mayor Bill de Blasio has halted his controversial plan to regulate the company. At least, for now.

De Blasio had proposed a temporarily cap on the number of new licenses issued to Uber and smaller competitors like Lyft. Uber, for instance, would have only be able to increase its license count by 1%, or 200 cars in a year’s time.

On Wednesday, the de Blasio administration said it won’t take the bill to the City Council, which was expected to happen as soon as Thursday, The Mayor’s office it would take up the issue again after completing additional studies on traffic congestion and the impact on drivers.

“The cap legislation currently before the City Council will be tabled throughout the traffic study process,” said First Deputy Mayor Anthony Shorris in an e-mail statement.

According to the NYC Taxi and Limousine Commission, there were 2,000 new vehicle licenses issued each month — and the vast majority (72%) of pickups are in congested areas of Manhattan.

For its part, the city isn’t counting the decision as a loss, because it says Uber has agreed to be conservative with its expansion in the city.

De Blasio’s proposal had met with much criticism.

David Plouffe, head of Policy and Strategy at Uber, criticized the cap as an “offering to the taxi industry who has showered them with a lot of campaign money.” Plouffe said the plan to cap licenses could cost more than 10,000 jobs.

New York Governor Andrew Cuomo said on Wednesday that the government shouldn’t step in to restrict job growth.

Celebrities like Ashton Kutcher and Kate Upton have taken to Twitter to show their disapproval of de Blasio’s suggested bill. Kutcher is an investor in Uber.

A cap in New York City — one of Uber’s biggest markets in the U.S — would have been a major hit to the company, which is valued at $50 billion.

Uber is in over 300 cities in 58 countries and is no stranger to regulatory battles.

Some cities have banned its services, it is being sued for employing contractors instead of full-time workers, and it was recently fined $7.3 million for not complying with regulations in California.