Toronto council rescinds cap on licences for rideshare drivers amid legal fight with Uber

Toronto will resume issuing licences to rideshare drivers after council voted to scrap a cap introduced two months ago amid the city's ongoing legal fight with Uber Canada.

On Thursday, Mayor Olivia Chow introduced a motion to cancel a part of a motion adopted during October's council meeting that capped the number of rideshare drivers at current levels.

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Her motion then directed city staff to start issuing vehicle-for-hire and private transportation company driver licences under the previous system and asked the city manager to report back to the executive committee in March on new options to limit the licences, which would include feedback from the public and industry stakeholders.

"Let us have a comprehensive look at this. And by March we will have a much more informed discussion. Today's motion helps us achieve this goal, while also finding the right reasonable balance as it relates to public consultation and our ability to give staff the time they need to collect data from the industry and to help us meet our climate obligations," Chow said.

Lifting the cap on licences comes as the city was about to face Uber Canada in court over the issue. Last week, the rideshare company filed an injunction against the city, alleging that the cap was enacted in bad faith and without notice, which violates the city's own procedural bylaws.

In a confidential report to council about the lawsuit obtained by CTV Toronto, the City Solicitor writes that there are "legal issues" with how the freeze was enacted. Rescinding the cap, she advises, would "render Uber's application moot;" pausing it would allow for consultation with the industry.

"Any cap implemented after receiving information from City staff and comments from stakeholders would be more defensible," the report reads.

Following the council's Thursday vote, Uber Canada said there is no longer a need for an urgent injunction.

"By reversing their arbitrary rideshare cap, City Council is providing temporary relief to the hundreds of thousands of Torontonians who use rideshare, and to the drivers who can use this opportunity to earn extra income," the company said in a statement.

"But make no mistake, this is only a short-term fix. Mayor Chow has signalled her intention to bring back a permanent rideshare cap in early 2024. If Mayor Chow was truly interested in reasonable, data-driven, evidence-based policymaking, she would allow city staff to run a comprehensive process."

With files from CTV Toronto's Natalie Johnson