This month, the California DMV issued a memo saying any car used for transporting people for money must be registered as a commercial vehicle.
UPDATE: Late Friday, after this story aired, the DMV has retracted the memo, saying, in part: "The matter requires further review and analysis which the department is undertaking immediately."
That's nothing new, it's been the law since 1935.
In a statement, the DMV said: "The recent public notice answered an increasing number of dealers and customers who have inquired about the issue. Of course, if law changes we will update our notices accordingly."
FOX40 spoke to a driver for ride-sharing company, Lyft, who says he will not change over to commercial registration.
"I'm not going to change my car to be like commercial. When you put your car from private to commercial the price will go down," said driver Mohammed.
Mohammed says he's worked as a yellow cab driver in the past but enjoys the convenience of working from his smart phone and carrying passengers in his personal car.
The popularity of ride-sharing companies has affected the taxi industry.
"They're essentially offering high tech hitch hiking," said Josh Jacoby, director of administration for yellow cab of Sacramento.
Jacoby says registering commercial vehicles requires more money and more upkeep.
"Commercial vehicles are subject to different standards when it comes to the vehicles themselves and they have to be inspected more frequently and they have to have commercial insurance that covers for hire rides," Jacoby said.
As for Mohammed, he says until he's told otherwise, he will continue picking up passengers, at his own risk.
If pulled over, he and other drivers face citation for registration violation.
The CHP says it enforces state law and will cite vehicles for having improper registration.
FOX40 reached out to both Uber and Lyft for comment on this story. We did not hear back from either company.