11.05.2017

Uber could face transport license questioning, EU advisor says

400An advisor to Europe’s highest court has said that Uber should be regulated as a transportation company, subjecting it to local licensing regulations which could have been considered disproportionate under EU law had it been deemed an "information society service".

In a opinion handed down Thursday, Maciej Szpunar, the advocate general of the European Court of Justice (ECJ), said “Indirect control such as that exercised by Uber, based on financial incentives and decentralised passenger-led ratings, with a scale effect, makes it possible to manage in a way that is just as — if not more — effective than management based on formal orders given by an employer to his employees and direct control over the carrying out of such orders.” The decision handed down today is non-binding, though ECJ rulings have historically followed the advice of the advocate general. A final ruling is expected later this year.

The case was brought by an association of Barcelona taxi drivers who argued that Uber engaged in unfair competition with its UberPOP service - which used unlicensed drivers. The company later suspended its services in Spain, but returned to the country in 2016 after agreeing to hire licensed taxi drivers. Its low-cost UberPop offering previously connected users with non-professional drivers.

Although Szpunar also makes a point of emphasizing that despite his assessment that Uber is acting as an employer in the manner in which it uses technology to manage drivers and the quality of service, the issue of whether all Uber drivers are then “necessarily” employees is an entirely separate question — and one that is not part of the legal determination in the case before the ECJ.

Uber has faced regulatory hurdles in several European countries since expanding to the continent in 2011. The company has faced lawsuits and bans in France, the Netherlands, Italy, and Germany, and two senior executives in France were charged in 2015 for operating an illegal taxi service. Valued at $68 billion, Uber reintroduced a licensed version of its service in Madrid and Berlin last year. However, UberPOP is still operated in Estonia, Poland, Czech Republic, Norway, Finland and Switzerland.

“We have seen today’s statement and await the final ruling later this year,” an Uber spokesman said in a statement. “Being considered a transportation company would not change the way we are regulated in most EU countries as that is already the situation today. It will, however, undermine the much needed reform of outdated laws which prevent millions of Europeans from accessing a reliable ride at the tap of a button.”


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