Ride-sharing apps such as Uber and Apple-backed rival Didi Chuxing will be officially legal from November.
After launching in Shanghai three years ago, Uber is now legal in China.
Up until now ride-sharing apps like Uber had been operating in a legal grey area in China. The new law, which takes effect on 1 November, ends that uncertainty with a set of rules for apps that connect passengers to drivers using their own cars to offer rides.
The exact implementation of the new rules will be worked out by local authorities, but will include criminal record checks and licenses for drivers. Meanwhile cars must have alarms and GPS, and there's a ceiling on the mileage of the cars.
The stage is now set for the price war to continue between global ride-sharing behemoth Uber and local rival Didi Chuxing. Uber operates in 60 cities in China and plans to launch in 30 more in coming months, the company said in a statement. Didi is backed by Chinese internet giants Tencent and Alibaba -- and by Apple, to the tune of $1 billion.