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An illustration picture shows the logo of car-sharing service app Uber on a smartphone next to the picture of an official German taxi sign in Frankfurt, Sept. 15, 2014.Kai Pfaffenbach/Reuters

Taxi services such as Uber make "people's lives easier," Toronto mayor-elect John Tory said Tuesday – the same day Canada's Competition Bureau urged the city against banning the app.

Both Mr. Tory and the Ottawa-based agency spoke out Tuesday against Toronto's move to file an injunction in court against the Silicon Valley-based company. And while city officials argue that the company is operating in contravention of the city's taxi licensing rules, both Mr. Tory and the competition bureau say the service, which allows riders to hail and pay for cabs using their mobile device, is good for consumers.

"Municipalities should consider whether prohibitions on digital-dispatch services and ride-sharing applications are necessary," the competition bureau said in a press release on Tuesday.

Meanwhile, Mr. Tory – who first spoke out against the court action last week, when it was first filed by the city – joked to reporters that he was glad the competition board "came onboard."

"The reality is that there's great technology out there that is making people's lives easier and better every day, whether it's related to taxi or other things," he said. "I think that regulators, whether it be taxis or other industries, have to take into account in doing their job that the world is changing and it's changing for the better, and that regulations have to be modernized."

The city of Toronto filed its injunction against Uber last Tuesday, arguing that the app-based taxi service poses "a serious risk to the public." Citing lack of driver training, inadequate insurance, and unregulated fares, the court action requests that the company cease all operations in Toronto.

With a report from Bloomberg.