Uber, France spar over whether company is a transport service

Some Uber services have been banned in several countries or cities around Europe after the company lost lawsuits in France, Germany, Belgium and Spain. [noeltock / Flickr]

US ride-hailing app Uber told Europe’s top court on Monday (24 April) that it was a digital service, not a transport service, and that a French law clearly targeted online taxi services, in its latest European legal battle with the taxi industry.

Uber expanded into Europe five years ago and has come under attack from taxi companies who see it as unfair competition bypassing strict licensing and safety rules.

In a hearing in Europe’s top court in Luxembourg, the US start-up described itself as a digital platform connecting willing passengers with drivers and said it does not itself provide a transport service, which would see it subjected to stricter rules.

Hugues Calvet, Uber’s lawyer, compared it to online hotel booking services like Booking.com, saying they did not actually provide the room.

“In fact it doesn’t give the transport service itself,” Calvet said.

Uber gains key support ahead of EU Court hearing

A majority of EU governments are expected tomorrow (29 November) to back – at least partly – the ride-hailing firm’s claim of being a digital platform, opening the way for a lighter regulatory oversight of the American-based company than if it was considered like a normal transport firm.

The case before the Court of Justice of the European Union (ECJ), referred to it by a court in Lille, concerns a 2014 French law on taxis and chauffeured services which makes it a criminal offence to organise illegal taxi services and sets restrictions on the use of software to find customers in the street.

Two of Uber’s executives in France were fined last year over UberPOP, Uber’s service using unlicensed drivers, which has since been suspended.

Uber, as well as the European Commission, also argued that the French law targeted electronically provided taxi services and therefore Brussels ought to have been notified about it. EU law requires that Brussels be informed of measures relating to online services.

France did not notify Brussels of its law and as such criminal penalties cannot be enforced against Uber, the company argued.

It is the second case concerning Uber that the Luxembourg judges will rule on, the other being a dispute with Barcelona’s main taxi operator in which the ECJ is asked whether Uber is a digital service or a transport service.

Uber files second complaint against French law

Uber has filed a second complaint to the European Commission against a French law that the online taxi-booking service says favours regular taxis at its expense, the company said on Tuesday.

“Pretty big nut”

The legal tests stand to define whether the Silicon Valley company has a future in Europe after years of battles with city regulators and local taxi associations. Its service has been banned in several countries or cities around Europe after the company lost lawsuits in France, Germany, Belgium and Spain.

The court battles come as Uber struggles with a wave of executive departures and criticism of its work culture.

Referring to the penalties foreseen in the French law, Calvet said a “sledgehammer has been used to crack a nut.”

Tayeb Ismi-Nedjadi, a lawyer for the French public prosecutor, replied that Uber was no small company, so “when we’re talking about using a sledgehammer to crack a nut, we’re talking about a pretty big nut.”

Michel Bauwens: Uber ‘should be regulated like rest of the economy’

Enterprises like Uber and Airbnb “basically suck value out of the local economy” by trying to work around social laws and other regulations, says Michel Bauwens. But simply banning them would be short-sighted, he told EURACTIV.com.

Uber is valued at $68 billion and its investors include Goldman Sachs and GV, formerly known as Google Ventures .

France said its law was not aimed at online services and would also have targeted people meeting travellers at airports and touting illegal taxi rides.

Joanna Hottiaux, a lawyer for the European Commission, said it was hard to imagine that people touting illegal taxi services could be so widespread as to require specific legislation.

An ECJ adviser will give a non-binding opinion on the case on July 4. The case is C-320/16.

EU cautions governments against banning Uber, Airbnb

Services such as ride-hailing app Uber and home-rental site Airbnb should only be banned as a last resort, the European Commission said on Thursday (2 June), as it seeks to foster development of the “sharing economy”.