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Image credit: Charles Platiau / Reuters

EU decides to treat Uber like a taxi company, not an app

The landmark decision will drastically change how Uber operates in Europe.
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Charles Platiau / Reuters

Europe's highest court has ruled that Uber is a transportation company and not some kind of middleman between passengers and drivers, like it has often claimed. The much-anticipated decision opens the door for member nations to impose stricter regulations on the company, especially where it operates the UberPOP service with non-professional drivers.

The judges weren't buying Uber's argument that it's merely an information company. "The service provided by Uber is more than an intermediation service consisting of connecting, by means of a smartphone application, a nonprofessional driver using his or her own vehicle with a person who wishes to make an urban journey," the ruling states. "The application provided by Uber is indispensable for both the drivers and the persons who wish to make an urban journey."

Uber took the decision in stride, despite the serious potential impact on its future growth. "This ruling will not change things in most EU countries where we already operate under transportation law," the company told Engadget in a statement. "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."

The service provided by Uber is more than an intermediation service consisting of connecting, by means of a smartphone application, a nonprofessional driver using his or her own vehicle with a person who wishes to make an urban journey. The application provided by Uber is indispensable for both the drivers and the persons who wish to make an urban journey.

The decision came after over two years of deliberation, prodded by a complaint by a Spanish taxi association. It claimed that Uber wasn't competing fairly by using non-licensed drivers that don't have to deal with the strict rules and checks imposed on taxi drivers.

The decision caps off a very bad 2017 for Uber in Europe and elsewhere. The company was banned in London and could be outlawed in other UK cities, and has had legal troubles in Spain, Italy, Greece, France and elsewhere. In the US, it was accused of sexual harassment, illegal spying on competitors (and law enforcement), and stealing trade secrets from Waymo. CEO Travis Kalanick also stepped down in June and replaced by Dara Khosrowshahi.

Khosrowshahi isi trying reform Uber's battered image, but it'll be hard for him to stay ahead of all the problems. That was highlighted in the so-called Jacob Letter, that brought a number of previously unknown issues to light. Uber will do well just to keep those fires tamped down, so 2018 isn't looking any better for the ride-hailing, er, transportation service.

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