Uber a transport firm, not a digital service: EU court

Brussels, Dec 20 (IANS) Ride-hailing app Uber was dealt a blow on Wednesday when the European Union's top court ruled it to be a transport company rather than a digital intermediation service as the company had argued, and therefore subject to similar regulation as traditional taxi companies.

The judgment by the European Court of Justice (ECJ) came after a challenge brought in 2014 by taxi drivers in Barcelona that the activities of Uber Systems Spain amounted to unfair competition considering that its drivers did not require a taxi permit nor did they submit to the same regulation as other taxi companies in the city.

Uber had denied it was a transport company, arguing instead it was a computer services business with operations that should be subject to an EU directive governing e-commerce and prohibiting restrictions on the establishment of such organisations, the Guardian reported.

It said the verdict would make little difference to the way it operated in Europe but experts say the case could have implications for the gig economy.

An Uber spokesperson said: "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. 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."

In its ruling, the ECJ said: "An intermediation service, the purpose of which is to connect, by means of a smartphone application and for remuneration, non-professional drivers using their own vehicle with persons who wish to make urban journeys, must be regarded as being inherently linked to a transport service."

The decision will apply across the whole of the EU including the UK.

The court also pointed out that Uber exercises "decisive influence" over the conditions under which drivers provide their services. Such an intermediation service, the ECJ concluded, must be regarded as forming an integral part of an overall service, the main component of which is transport.

The landmark ruling meant it was up to individual EU member states to decide what regulation to apply to the San Franciso-based car-sharing technology, the statement added.

Trades Union Congress General Secretary Frances O'Grady said the verdict meant Uber must "play by the same rules as everybody else".

She added: "Their drivers are not commodities. They deserve at the very least the minimum wage and holiday pay. Advances in technology should be used to make work better, not to return to the type of working practices we thought we'd seen the back of decades ago."

The verdict came after Uber was told last month that the appeal to renew its licence in London could take years, according to Mayor Sadiq Khan.

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