This file photo taken on March 10, 2017 shows Uber signage is seen
outside the entrance of the ride-hailing giant's office in Hong Kong on
March 10, 2017. FILE PHOTO | AFP
The EU's top court ruled on Wednesday that Uber is an ordinary
transportation company instead of an app and should be regulated as
such, in a decision that will be closely watched around the world.
The
case is yet another thorn in the side for scandal-rocked Uber, which
has drawn the fury of local taxi drivers and officials for flouting
local regulations.
It also comes the same week as one
of its drivers admitted to the attempted rape and murder of a British
embassy worker coming home from a night out in Beirut, Lebanon.
"The
service provided by Uber connecting individuals with non-professional
drivers is covered by services in the field of transport," said the
Luxembourg-based European Court of Justice.
"Member states can therefore regulate the conditions for providing that service."
'Mere service provider'
Uber,
the biggest name in the growing gig economy, claims it is a mere
service provider, connecting consumers with drivers in more than 600
cities.
But it has run into huge opposition from taxi
companies and other competitors who say this allows it to dodge costly
regulations such as training and licensing requirements for drivers and
vehicles.
The case was brought by a taxi drivers'
association in the Spanish city of Barcelona, where belief runs high
that Uber is a taxi company that should be subject to rules governing
such vehicles.
In a dense legal judgement, the ECJ said
that Uber was a service that connects "by means of a smartphone
application and for remuneration non-professional drivers using their
own vehicle with persons who wish to make urban journeys."
That
means it is "inherently linked to a transport service and, accordingly,
must be classified as a 'service in the field of transport' within the
meaning of EU law."
A rough ride
The EU court's senior adviser had said in a legal opinion in May that Uber was indeed a transport company.
The company has rejected that argument, saying it will harm innovation.
"To
be considered a transport company will not change the regulations we
are subject to in most European countries," a spokesman for Uber said.
"It
will however hurt the necessary reform of outdated laws which prevent
millions of Europeans being able to find a reliable ride with just one
click," the spokesman said.
Uber has had a rough ride
in Spain, where a judge ruled in 2014 that its UberPop service risked
breaking the law, leading to the Barcelona submission to the ECJ.
Early
last year it decided to only operate a limited a version of its UberX
service in Spain which uses licensed, professional drivers instead of
the amateurs who had previously worked via the UberPop application.
Uber
has already had problems with the law in several European countries,
particularly France where the company was forced to overhaul its
business model.
Lose licence
In
November a labour court in London, where the company is threatened with
losing its licence, said it had to pay the drivers a minimum wage and
give them paid leave.
Uber does not employ drivers or
own vehicles, but instead relies on private contractors with their own
cars, allowing them to run their own businesses.
Licensed
taxi drivers meanwhile often have to undergo hundreds of hours of
training, and they accuse Uber of endangering their jobs by using
cheaper drivers who need a GPS to get around.
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