The European Court of Justice has ruled that Uber is a transport company
On 20 December 2017, the European Court of Justice has ruled that Uber is a transport services company. (The decision is a major setback for Uber, which has long insisted that it should be treated as technology service that connects drivers and riders; in other words, the Court placed itself on the side of traditional taxis. This definition will require the company to use only licensed taxi drivers, as well as meet other strict regulations linked to health and safety and background checks on drivers on its digital platform.
The ruling ends a legal battle started in 2014 by a taxi drivers' association in Barcelona, called Associacion Profesional Elite Taxi. It accused Uber of unfair competition: The Uber Pop service used unlicensed drivers and wasn't authorized to carry passengers, it did not comply with the same rules that applied to existing taxis. Uber, as it always does, claimed it was just an intermediary connecting drivers with passengers that should be subject to an EU directive governing e-commerce and prohibiting restrictions on the establishment of such organisations.
The Court rejected that argument in its landmark decision, taking into account that since the Uber app is „indispensable for both the drivers and the persons who wish to make an urban journey" and since „Uber exercises decisive influence over the conditions under which the drivers provide their service," Uber 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. 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.
„This ruling will not change things in most EU countries where we already operate under transportation law,” Uber said in a statement. „However, millions of Europeans are still prevented from using apps like ours.”
The decision is expected to set a precedent for how Uber will be allowed to operate across the EU – where the company already operates, and will continue to do so in many countries – including in a separate pending case at Europe’s highest court involving a complaint by a French taxi association against Uber.
Petra Agnes Kanyuk
Law Student, University of Debrecen, Faculty of Law