The NSW state government has legalised UberX, with premier Mike Baird’s cabinet legalising the service immediately and finalise a compensation plan for taxi owners whose licence plate values will drop.

The Daily Telegraph is reporting the nearly 6,000 taxi plate holders in NSW will be compensated $20,000 per plate — and be allowed to continue operating in the same capacity as they already do. Multiple plate owners will be able to claim for a maximum of two plates. Additional funds will be set aside to further compensate owners who only purchased plates recently; the entire fund will cost nearly $120 million for the state.

Taxis will retain the exclusive rights to pick passengers up from streets and airports. Uber drivers will have to pay a licence fee, criminal background checks and have their cars regularly put under safety checks.

NSW has become the second state or territory to legalise ride sharing services, following the ACT.