service Uber, New York AG reach deal on emergency
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[July 09, 2014]
By Bernard Vaughan
NEW YORK (Reuters) - Uber
Technologies Inc, a car service that allows users to
summon a ride on their smartphone, has agreed to cap
prices during emergencies and natural disasters in New
York state to prevent price gouging, New York Attorney
General Eric Schneiderman announced Tuesday.
The company also agreed to announce a national policy to limit
pricing in emergencies, Schneiderman said in a news release.
The three-year agreement calls on Uber to limit pricing during
"abnormal disruptions of the market," to abide by a New York
price-gouging law passed in the late 1970s amid escalating heating
oil prices, according to the news release. The agreement takes
Uber, whose rates rise and fall with demand, will cap prices during
such disruptions to the normal range of prices charged in the
preceding 60 days, Schneiderman's office said.
Schneiderman said Uber might have "run afoul" the state's
price-gouging laws in an April Op-Ed in The New York Times in which
he called on the company to address the problem.
Uber has grown rapidly since its 2010 launch in San Francisco, with
a recent $1.2 billion funding from blue-chip investors valuing the
company at $18.2 billion, one of the highest ever for a Silicon
But it has also faced regulatory obstacles in some cities, and
lawsuits from taxi companies hoping to keep new competition out.
The agreement "represents the thoughtful application of
long-established law to new technology," Schneiderman said in the
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The policy "intends to strike the careful balance between the goal
of transportation availability with community expectations of
affordability during disasters," Uber CEO Travis Kalanick said in
the press release.
Kalanick added the "collaborative solution" with Schneiderman "is a
model for technology companies and regulators in local, state and
federal government," according to the release.
(Reporting by Bernard Vaughan; Additional reporting by Sarah
McBride. Editing by Andre Grenon)
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