Uber is not just a digital company, ECJ rules

20 Dec 2017

Uber app. Image:  Allmy/Shutterstock

Uber’s effort to stay outside of the scope of EU regulation as a transport company has failed, and now it’s facing much stricter regulation.

From here on in, Uber will be treated as a taxi company in the EU and will be subject to the same regulations that any other taxi firm would.

That was the decision made by the European Court of Justice (ECJ) and it will come as a major blow to Uber as it aimed to be treated as just a digital company.

“The service provided by Uber connecting individuals with non-professional drivers is covered by services in the field of transport,” the ECJ ruled. “Member states can therefore regulate the conditions for providing that service.”

According to CNBC, Uber’s legal argument was that it was an “information society service” that simply connects drivers with passengers through its app.

This, it claimed, would distinguish itself as a digital company that would be capable of operating across borders in the EU single market, despite the protestation of a number of EU states.

However, ECJ advocate general Maciej Szpunar earlier this year countered this claim by saying that in order to meet this requirement, Uber’s drivers would need to be “economically independent”.

As part of the new ruling, Uber will now be required to work far closer than it has with local governments to meet various licensing requirements and public transportation rules.

‘This ruling will not change things’

Another blow for Uber is that this ruling cannot be challenged in the ECJ, but there is still an option to pursue an appeal in other courts.

A spokesperson for Uber said following the decision: “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.”

It has been a tough year for Uber as a whole, with its co-founder and CEO stepping down over criticism of the corporate culture he had created at the company – particularly in Europe, where it saw its London licence taken away by Transport for London.

Uber is now operating once again in the city but is currently in the courts appealing any attempts to shut its access to the city.

Uber app. Image:  Allmy/Shutterstock

Colm Gorey was a senior journalist with Silicon Republic