Canada's Quebec government and US ride-sharing service Uber struck a tentative deal Thursday for the company to continue operating in the province, as part of a one-year test program.
Authorities had threatened to ban Uber if it did not comply with local laws before September 8.
Following last-minute negotiations, Quebec Transportation Minister Laurent Lessard said the agreement "respects the required parameters for Uber to operate a taxi service in Quebec."
According to local media, Uber has pledged to collect and pay provincial and federal value-added taxes on each trip made by its UberX drivers.
In addition, Uber reportedly will cap the time worked by all drivers to 50,000 hours per week, and pay a fee per ride to the Quebec government to finance a modernization fund for the local taxi industry.
Lessard said that under the guidelines, traditional taxis and their direct rival, the company's UberX vehicles, "are going to compete on a more balanced playing field."
"We will need to evaluate our capability to offer a quality service to drivers working in the share-ride service and customers under this new pilot project," said Uber Quebec general manager Jean-Nicolas Guillemette in a statement.
He insisted that the company was determined to "demonstrate to the government that we are ready to work in a regulated industry and be a partner in innovation."
As has happened in many locations around the globe, the arrival of the UberX ride-sharing business in Canada has generated hostility from the taxi industry.
Taxi drivers in Quebec filed a lawsuit in February seeking to block its operations.
Other areas in the country are supportive. Edmonton, the capital of Alberta province, became the first Canadian city to vote to legalize Uber on January 27.
The Canadian capital of Ottawa has also given Uber the green light to begin service on September 30.
And in Toronto, Canada's largest city, the municipal government has created a new category of taxi license required for Uber drivers.
Explore further: Uber files complaint with EU against Hungary