Its both - competition and regulation. If one company does not follow them, but others do, then you have a distortion of competition. The difficulty is in to tell whether Uber is operating like a Taxi company or not. They certainly operate on a different model than the usual Taxi business. So that's why Uber ignored the laws until someone cried foul.

Btw. I think the business is regulated fairly. The income is not. Most difficulties are with the concessions and the natural oligopols around them.