China's local traffic regulators rolled out stringent requirements for ride-hailing service providers like Didi Chuxing on Saturday, possibly making it difficult for them to recruit rideshare drivers.

According to China Daily, transport authorities from major cities including Beijing, Guangzhou, Shanghai, and Shenzhen separately issued local draft regulations imposing restrictions on driver's hukuo (household registration), car plates, vehicle model, age, and compulsory insurance.

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The proposed policy will ban migrant workers from outside these major cities to operate cars for the said services. These mega-cities would then require drivers to operate only locally registered vehicles, Reuters reported. It also requires cars to be equipped with Global Positioning System and emergency alert devices.

In response, Didi Chuxing said the proposed law would not only result to a significant drop in the number of drivers but also help double rideshare costs for the hundreds of millions of app users in those mega-cities. Its statement was officially released on its Chinese Twitter-like Weibo account.

"Millions of online ride-hailing drivers may be about to lose their jobs and paychecks, which would mean millions of families may lose an important income source," Didi, which has a valuation of over $33 billion, said in its statement.

Skepticism among local traffic regulators remained of Didi, about whether its business has been adding to traffic congestion and rivaling with other taxi companies, The Wall Street Journal reported.

"We must maintain our strategy of prioritizing public transportation to use the road resources reasonably, decrease the use of motor vehicles and ease traffic congestion," Beijing's municipal traffic authority posted on its Weibo account.

Meanwhile, local competitors in the car-hailing market like Shouqi and CAR said the proposed regulations are umlikely to affect their business but force the general market to upgrade.

The drafted regulation is open for public comments for seven days and two weeks for Beijing and Shanghai, respectively, which is relatively shorter than the usual practice, China Daily noted.

Tagsride sharing app, ride-hailing app, Didi Chuxing, car, Shouqi, traffic