Ride-sharing services in California were potentially under threat after the state Department of Motor Vehicles issued a memo this month saying that companies like UberX, Lyft and Sidecar must put commercial license plates on their vehicles.

Abruptly rescinding the memo on Friday night, DMV officials said the law is still in question, the Los Angeles Times reported.

"We jumped the gun, and we shouldn't have," the statement read. "The matter requires further review and analysis which the department is undertaking immediately."

Because the app-based services employ drivers who use their own cars, such a requirement would be detrimental to their ride-sharing platform. The initial DMV memo defining vehicles that transport people for profit as commercial vehicles clarifies a state law from 1935, the San Francisco Chronicle reported.

"Any passenger vehicle used or maintained for the transportation of persons for hire, compensation or profit is a commercial vehicle," said the DMV advisory. "Even occasional use of a vehicle in this manner requires the vehicle to be registered commercially."

The memo states that "an increasing number of dealers and customers have inquired about this process and received inconsistent information."

If the DMV advisory is enforced, the ride-sharing services' drivers would have to pay for commercial vehicle registration, fill out a plethora of paperwork, make an in-person appointment with the DMV and may have to purchase expensive commercial insurance.

App-based ride services, which are regulated in California by the state Public Utilities Commission, have spread rapidly despite meeting opposition in many markets. Uber alone has around 50,000 drivers in the state of California.

The rides are seen as a threat to the taxi industry and have also been criticized as unsafe even when drivers are required to undergo a background check and other screenings.

"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 ridesharing in California," Lyft said in a statement.

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