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Uber to face stricter EU regulation after ECJ rules it is transport firm Uber to face stricter EU regulation after ECJ rules it is transport firm
(35 minutes later)
Uber is a transport services company, the European court of justice has ruled, requiring it to accept stricter regulation and licensing within the EU as a taxi operator. Uber is a transport services company, the European court of justice (ECJ) has ruled, requiring it to accept stricter regulation and licensing within the EU as a taxi operator.
The decision in Luxembourg, after a challenge brought by taxi drivers in Barcelona, will apply across the whole of the EU, including the UK.The decision in Luxembourg, after a challenge brought by taxi drivers in Barcelona, will apply across the whole of the EU, including the UK.
Uber had denied that it was a transport company, arguing instead that it is a computer services business with operations that should be subject to an EU directive governing e-commerce and prohibiting restrictions on the establishment of such organisations. Uber had denied it is a transport company, arguing instead that it is a computer services business with operations that should be subject to an EU directive governing e-commerce and prohibiting restrictions on the establishment of such organisations.
Lawyers for Barcelona’s Asociación Profesional Elite Taxi argued that Uber was directly involved in carrying passengers. EU rules on the freedom to provide services expressly exclude transport.Lawyers for Barcelona’s Asociación Profesional Elite Taxi argued that Uber was directly involved in carrying passengers. EU rules on the freedom to provide services expressly exclude transport.
In its ruling, the ECJ said an ‘intermediation service’, “the purpose of which is to connect, by means of a smartphone application and for remuneration, non-professional drivers using their own vehicle with persons who wish to make urban journeys, must be regarded as being 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”. In its ruling, the ECJ said an “intermediation service”, “the purpose of which is to connect, by means of a smartphone application and for remuneration, non-professional drivers using their own vehicle with persons who wish to make urban journeys, must be regarded as being 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”.
“Consequently, such a service must be excluded from the scope of the freedom to provide services in general as well as the directive on services in the internal market and the directive on electronic commerce,” the ruling said.“Consequently, such a service must be excluded from the scope of the freedom to provide services in general as well as the directive on services in the internal market and the directive on electronic commerce,” the ruling said.
“It follows that, as EU law currently stands, it is for the member states to regulate the conditions under which such services are to be provided in conformity with the general rules of the treaty on the functioning of the EU.”“It follows that, as EU law currently stands, it is for the member states to regulate the conditions under which such services are to be provided in conformity with the general rules of the treaty on the functioning of the EU.”
More to follow … The ECJ found that Uber’s services were more than merely an “intermediation service” consisting of a smartphone app that connects non-professional drivers using their own vehicle with passengers wanting to hire them for a journey.
The ECJ observed that the application provided by Uber was “indispensable for both the drivers and the persons who wish to make an urban journey”. The court also pointed out that Uber exercises “decisive influence” over the conditions under which drivers provide their service.
Such an “intermediation service”, the court concluded, must be regarded as forming an integral part of an overall service whose main component is a transport service. Therefore Uber’s operations must be classified not as “an information society service” but as “a service in the field of transport”.
Uber insisted the judgment would not have a significant impact on its business model. A spokesperson said: “This ruling will not change things in most EU countries where we already operate under transportation law. However, millions of Europeans are still prevented from using apps like ours. 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. This is the approach we’ll take to ensure everyone can get a reliable ride at the tap of a button.”
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