Chicago has granted its first two ridesharing licenses to San Francisco-based companies Lyft and Sidecar.
They are among several companies that allow people to summon the nearest driver at the push of a button from a GPS-based smartphone app. The private drivers use their own cars.
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The City Council passed an ordinance in May establishing a licensing and regulatory framework for the young industry. The first two annual licenses were issued Tuesday.
Mayor Rahm Emanuel called the regulations "sensible" and said they support innovation while ensuring passenger safety.
Besides being licensed by the city, rideshare companies in Chicago must conduct driver background checks and training, obtain insurance and inspect affiliated vehicles.
The taxi industry has not welcomed the increased completion and contends ridesharing companies skirt safety and other regulations.