LEGAL NEWSLINE

NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman announced an agreement on Tuesday with Uber, a mobile application that connects riders with for-hire vehicles, to limit prices during emergencies and natural disasters.

Uber uses dynamic rates for rides, which rise and fall with demand. Under the terms of the agreement, Uber agreed to limit its prices during abnormal disruptions of the market to ensure the company complies with New York's price gouging law.

"This agreement represents the thoughtful application of long-established law to new technology," Schneiderman said. "It provides consumers with critical protections to which they are entitled under the law - and it provides Uber with clarity from government about how the law will be applied to its innovative pricing model. This agreement also serves as a model for the kind of effective collaboration that should exist between government and technology companies like Uber. I am particularly proud that Uber is adopting a similar policy nationwide."

New York's price gouging law states that during an abnormal disruption of the market, all parties within the chain of distribution of any essential consumer services or goods are prohibited from charging unconscionably excessive prices. The law defines abnormal disruption of the market as any change in the market resulting from stress of weather, failure of electric power, convulsion of nature, strike, national or local emergency, civil disorder, military action, war, or any other cause of disruption that results in the declaration of a state of emergency.

Under the terms of the agreement, Uber will limit prices during abnormal disruptions of the market on all its services that use dynamic pricing, including Uber SUV, Uber Black and UberX.

"This policy intends to strike the careful balance between the goal of transportation availability with community expectations of affordability during disasters," Travis Kalanick, the CEO and co-founder of Uber, said. "Our collaborative solution with Attorney General Schneiderman is a model for technology companies and regulators in local, state and federal government."