California DMV abruptly backtracks on rule that Uber and Lyft drivers need commercial plates

Updated at 12:46pm Pacific with a statement from the DMV.

In an abrupt turn of events, the California Department of Motor Vehicles has retracted a new rule that forced drivers of services like Uber and Lyft to get commercial plates for their vehicles.

Earlier this month, the DMV issued the ruling, which seemed to contradict a California law that said that drivers for such services were people using their “personal vehicles.” The DMV’s new edict also countermanded language issued by the California Public Utilities Commission (CPUC), which governs ride-sharing services, that allowed the use of personal vehicles by ride-sharing drives.

Both Lyft and Uber had been adamant that the DMV rule had overstepped its bounds.

In a statement to VentureBeat yesterday, Lyft said that “Requiring Lyft drivers, including those who drive just a few hours a week, to get commercial plates would essentially treat peer-to-peer transportation the same as a taxi, undermining the thoughtful work done by the CPUC to craft new rules for ride-sharing in California.”

In its own statement yesterday, Uber said that the CPUC allows its drivers “to use personal vehicles with personal registration on the UberX platform. Earlier this year, Governor Brown and the California Legislature agreed with the CPUC when they passed a … bill that affirms that … drivers may use personal vehicles.”

The opposition seems to have worked. In a statement provided to VentureBeat, DMV director Jean Shiomoto said the agency has backed off its decision. “There remains uncertainty about the interaction and effect of this law governing vehicle registration requirements with the more recent regulatory and statutory changes affecting ride share operators,” Shiomoto said. “We jumped the gun, and we shouldn’t have. The matter requires further review and analysis which the department is undertaking immediately.”

Shiomoto added that the DMV will now meet with regulators, as well as the ride-sharing industry, to discuss how to handle the issue of registering drivers. For now, though, the ruling has been revoked.