The battle between the city of Chicago and Uber, a startup seeking to disrupt the taxi and limo industries, heated up this week. Uber has already faced unwanted attention because its pricing model for taxis conflicted with Chicago regulations. Now the city is introducing new regulations for Uber's separate sedan service that the company says could force it out of the Chicago market.

Uber sedans charge based on time and distance traveled. The company's Chicago rates start at $3.50 per mile when the car is moving faster than 11 miles per hour and 85 cents per minute when the car is stuck in traffic. Uber spokesman Allen Penn tells us that this simple fare structure enables "clients to find and pay for reliable transportation in just minutes and drivers to fill their downtime with additional trips that help them increase their earnings."

But Chicago's Department of Business Affairs and Consumer Protection has proposed new rules that would make it illegal for non-taxicabs to charge based on time or distance. The new rules state that car services "may not use any device, including, but not limited to, mechanical, electronic, or digital meters/equipment to measure and calculate passenger fares based on distance and/or time traveled." Instead, the fare "must be pre-arranged." Anyone charging based on time or distance, the department warns, will be considered an "unlicensed taxicab."

Uber says this would be a step backwards. The firm has been in Chicago for the last 15 months, and it says it has happily operated under the city's current rules. Penn told us that charging based on time and distance is "the only way you can summon a car quickly, keep the car for as little or as long as you want, and hop out without negotiating and transacting with the driver." He said that negotiating fares in advance via the company's mobile apps would be too cumbersome.

Penn also emphasized the importance of allowing new car services to develop innovative business models. "The proposed regulations cut against Uber's goal as a business to allow consumers to push a button and get a car," he said. "Uber is not Uber in an environment that restricts technology."

We contacted the city, but they were tight-lipped about the reasons for the change. "We are committed to working with companies that offer Chicagoans more transportation choices, more certainty, and higher quality customer service options," a spokesperson told us by email. We pressed her for details about why the new rules were needed, but she did not respond to our follow-up email.

Chicago wouldn't be the first city to enact regulations hostile to Uber's business model. This summer, the Washington, DC city council proposed regulations that would have forced Uber to charge at least five times the minimum taxi fare, effectively pricing Uber out of the taxicab market. The authors helpfully explained that this change was designed to "ensure that sedan service is a premium class of service with a substantially higher cost that does not directly compete with or undercut taxicab service." The proposal was withdrawn after Uber successfully stoked a public backlash against regulations that seemed to benefit incumbent taxicabs rather than consumers.

The same critique seems to apply to Chicago's new regulations. Obviously, Chicago taxicabs would rather not compete with Uber's black car service, and so incumbents are likely to welcome regulations that ban sedans from adopting taxi-like pricing. But it's not clear how consumers benefit from such a prohibition.

The new regulations have not yet been finalized. The public has until November 9 to comment on the city's proposal.