5 Factors Facing Lyft's Legal Department as Company Drives North of the Border
Lyft announced this week it plans to expand into Toronto.
November 16, 2017 at 03:32 PM
3 minute read
Lyft car. Jason Doiy/ALM.
San Francisco-based Lyft Inc. announced this week that it will begin operations in its first non-U.S. city, Toronto, this December.
“We've been looking forward to taking our brand of ridesharing international for some time, and we're super pumped to share this with our close friends up north,” the company wrote in a Monday blog post.
But the road to new markets for companies in the ridesharing industry—especially international markets—is not always smooth or easy, as evidenced by some of the legal and regulatory battles fought in recent years by Lyft's rival, Uber Technologies Inc.
Here are five issues Lyft's in-house lawyers could be grappling with as the company enters Canada's largest city:
Let It Snow: While ridesharing laws vary between U.S. cities, Lyft's expansion into Toronto presents some very Canadian rules and regulations. From Jan. 1 to April 30, all Lyft vehicles will need snow or all-weather tires to comply with the city's vehicle-for-hire bylaw.
Data Security: Lyft has previously hesitated or refused to share its collected data, saying this would breach user privacy or hurt its competitive advantage. But the vehicle-for-hire bylaw states that all private transportation companies must maintain all of their data and records, and that this data must be produced when requested. It's a way for the city to track the popularity of routes, easing traffic congestion and assisting in public transportation development.
Greater Accessibility: Toronto's vehicle-for-hire bylaw requires that companies like Lyft provide vehicles accessible for disabled passengers. Currently, Lyft only dispatches “accessible vehicles in real-time” in a few major U.S. cities, according to its website.
The Uber Factor: Ridesharing apps in Toronto became legalized and clearly regulated in June 2016, following a long (and often dramatic) battle between local regulators and Uber. Taxi drivers protested and some city leaders expressed concern that such services may not be safe. Michael Urban, the practice lead for government transformation at Toronto's Mowat Centre, said Uber paved the way for Lyft's entry into the market by dealing with the initial backlash against ridesharing and compelling the city to create ridesharing regulations. “Things seem to have calmed down quite a bit now,” Urban said. “Lyft has been sort of playing a long game here.”
Brand Recognition: Lyft's delayed entrance into markets outside the United States helped the company avoid some legal fights and unflattering headlines, but it also kept them out of the headlines in general. Uber has picked up speed in Toronto and elsewhere outside the 50 states, but Lyft lacks that customer base., “Their biggest obstacle will be a commercial recognition one, rather than a regulatory one,” Urban said of Lyft's foreign debut.
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