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Uber, Lyft May Face More Federal Oversight, Lawmaker Warns

Ryan Beene

(Bloomberg) -- Uber Technologies Inc. and Lyft Inc. may soon face stepped-up oversight after largely avoiding traditional rules during their rapid expansion in recent years, the chairman of the House Transportation and Infrastructure Committee said on Wednesday.

Representative Peter DeFazio, an Oregon Democrat, said at a hearing that ride-hailing companies have revolutionized how people travel but also have a lot of problems, such as adding to traffic congestion and conducting “woefully inadequate” background checks for drivers that have put passenger safety at risk.

DeFazio’s comments signal that U.S. lawmakers may take a more critical look at how Uber and Lyft fit into the nation’s transportation system. Uber, in particular, has been criticized for avoiding traditional transportation and labor regulations by labeling itself a technology company, drawing scrutiny from federal prosecutors and officials in cities such as San Francisco and London.

Uber and Lyft declined to send representatives to testify at the hearing after the companies “led us on for six to eight weeks that they would testify,” DeFazio said. In a statement on Thursday Lyft said the panel first contacted it about the hearing on Sept. 30.

The hearing should serve as “a wake-up call to the companies that have flooded our roadways with disruptive technologies and investor capital that their days of operating with little public policy and regulatory oversight in the transportation space are coming to an end,” DeFazio said.

(Adds Lyft comment in fourth paragraph.)

To contact the reporter on this story: Ryan Beene in Washington at rbeene@bloomberg.net

To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, Gregory Mott

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