Where I'm located existing taxi drivers are also independent contractors (freelancers) running under taxi brands. Those taxis are still regulated by authorities to make sure they comply with laws and charge standard price bands - they do spot checks and the licenses are revoked if problems occur. Technology companies shouldn't be given a free ticket just because they're the next big thing.
I believe Uber's implicit argument is that the individual drivers should be fined for not complying. If that actually happens, and drivers stop signing up, I would expect Uber to come up with some kind of program to limit driver liability.
