Quebec's taxi industry has suffered a major setback after the province's Superior Court rejected its demands to have Uber's business model declared illegal and its permit revoked.
CBC Canada reported that taxi companies, the union representing taxi drivers had argued that Transport Minister Laurent Lessard exceeded his authority when he signed a deal with Uber in 2016.
Justice Élise Poisson said in her ruling the transport minister did not exceed his authority in signing a deal with the tech giants.
The taxi industry argued that the original pilot project created two parallel systems of taxis in Quebec that amounted to "unfair competition" against traditional drivers and permit holders.
Quebec cabbys must buy or rent a permit to operate in the region. Uber drivers, under the deal, were allowed to bypass the permit requirement.
Under Quebec taxi legislation, the minister was only allowed to enter into an agreement "with actual players in the industry and not outside actors" according to the taxi industry.
"The law does not require, contrary to what the plaintiffs argue, the holding of a taxi permit in order to take part in a pilot project," the judge wrote.
"The court concluded the minister didn't exceed his authority in concluding a deal with Uber."
Despite the court ruling in favour of Uber their future in the province seems uncertain.
Lessard said in late September he would renew Uber's permit but added enhanced requirements surrounding driver training and background checks.
Uber objected to the minister's demands and said it would leave Quebec by Oct. 14 unless a new agreement was reached.
Quebec's taxi industry has suffered a significant decrease in revenue since Uber entered into the market due to the companies disruptive business model.