Europe's Highest Court Classifies Uber as Transport Service

22 December, 2017, 01:30 | Author: Katrina Soto
  • What is Uber? We are getting closer to an answer

The European Court of Justice (ECJ)ruled yesterday (20 December) that Uber is a transport company for the goal of employing drivers, as opposed to the "information society service" it had claimed - a decision that may make its appeal against a United Kingdom ruling that its drivers are workers less likely to succeed. SBC Abogados said in a statement that the ruling's consequences "can be extrapolated to other businesses that keep trying to avoid legal responsibilities in the services that they provide".

This verdict comes as a response to a complaint from 2014 from a professional taxi drivers' association in Barcelona, Spain.

In an emailed statement to TechCrunch, an Uber spokesperson says that this ruling will not affect Uber's operations in most European Union countries, where the company already complies with transport laws.

Taxi drivers honked in celebration while Uber — which is wrapping up a particularly punishing year — sought to play down the ruling Wednesday by the Luxembourg-based European Court of Justice.

This ruling sets out clearly that Uber is, in legal terms at least, a transport company. "Member states can therefore regulate the conditions for providing that service".

Neither Uber Systems Spain, which is related to Uber Technologies nor the non-professional drivers had the necessary authorizations and licenses that are mandatory under the regulation of taxi services in Barcelona. Uber said the ruling would make little difference in practice. "As our new CEO has said, it is appropriate to regulate services such as Uber, and so we will continue the dialogue with cities across Europe".

"However, millions of Europeans are still prevented from using apps like ours", adds the company spokesperson.

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It goes on to say that despite Uber's claims to be a mere service provider - linking customers with their ride - Uber should be classified as "a service in the field of transport" rather than "an information society service". Here, the firm argued that it was primarily a technology company, with its app bringing self-employed drivers together, rather than an employer.

In India too, Uber is facing a somewhat similar situation. "Their drivers are not commodities".

The government in Karnataka had issued rules which among other things, made it mandatory for ride-hailing services to get a permit before operating in the state. In many places its hallmark "peer-to-peer" service is already banned, and instead Uber's services are much like taxis, just more flexible and sometimes cheaper.

The decision in theory applies to ride-hailing services around the 28-nation EU.

"After today's judgment innovators will increasingly be subject to divergent national and sectoral rules", Jakob Kucharczyk, of the Computer & Communications Industry Association, told Bloomberg.

"There has also been a benefit in incumbent London taxi cabs, which are now taking credit cards, which they resisted for years".

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