Uber has officially launched in Portland, Ore., but drivers in the city may end up getting hit with hefty fines.

The launch comes despite City Commissioner Steve Novick saying that the service is operating illegally in the city. Novick oversees the Portland Bureau of Transportation, which is examining the city's taxi and limousine regulations for possible updating.

"People who pick up passengers for Uber in Portland should know that they are operating illegally and could be subject to penalties," said Novick in a press release. "Public safety, fairness among competitors and customer service are our top priorities. Unlike permitted drivers, Uber drivers do not carry commercial insurance, putting Portland customers at great risk."

If caught, Uber drivers could face fines of between $1,000 and $5,000 for picking up passengers without the proper taxi permits. According to one report, Novick sent two police officers to request rides after the app started working on Friday, however the officers were not successful in booking rides.

This is not the first time that Uber has had run-ins with city officials. The company was forced to pull out of Nevada last month after a court order. The city of Toronto also asked a court to shut down the service, claiming that it acts as a taxi service.

Portland Mayor Charlie Hales has also come out against the company in his city, even going as far as to call company SVP David Plouffe.

"I told him that if they're just going to come in and flagrantly violate the law, we'll throw the book at them," said Hales.

Despite the risk that the move may put on drivers, Uber is suggesting that Uber users in the city proceed.

"We are 100 percent behind the drivers and we support them every step of the way. We hope the city doesn't take [the aforementioned] kind of action," said Brooke Steger, the company's Pacific Northwest general manager.

The launch in Portland is particularly complicated because of the proximity of Portland to neighboring cities, where it does operate legally. This includes a simple ride across a bridge to Vancouver, Wash. Drivers in nearby cities can pick up passengers and take them to Portland in a matter of minutes, but in order to follow the city's regulations they would have to return without a paying passenger.

"There's nothing sharing about this so-called 'sharing economy' company: They want to profit in Portland without playing by the same rules as existing cab companies," continued Novick. "People who pick up passengers for Uber in Portland should know that they are operating illegally and could be subject to penalties."

Uber has been under close scrutiny of late because of comments made by company executives regarding Uber users' privacy. 

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