Ridesharing

Uber Makes The Case For Its Business Model In Europe’s Highest Court

Uber Defends Business Model

Just five years after expanding its ride-hailing business in Europe, Uber faced Europe’s highest court on Tuesday (Nov. 29) to defend its service against strict EU rules.

The company continues to fight in a landmark case that could result in it being labeled a transport company rather than a digital service, thus subjecting the firm to abide by the same strict local licensing and safety rules as established taxi companies, Reuters reported.

As part of Uber’s defense, the company said its service not only makes it easier for people to get around but also helps to cut down on pollution.

The Court of Justice of the European Union (ECJ) is overseeing Uber’s dispute with Barcelona’s main taxi operator, which filed the lawsuit against Uber back in 2014 for allegedly running an illegal taxi service via UberPOP.

If the case doesn’t go Uber’s way, it’s expected that the service will have to adhere to more stringent guidelines on licensing, insurance and safety, which Reuters pointed out could have trickle-down effects on other startups in the sharing economy, such as Airbnb and Deliveroo.

“If there is a transport service provided, a company should not be able to hide behind the thin veil of a different service,” Montse Balague Farre, the lawyer for Barcelona’s main taxi operator, explained.

Legal representatives for Spain, Ireland and France are also on board with Uber no longer being categorized as a digital service and instead taking on the treatment of any transport company operating in the EU.

However, the Netherlands, Estonia and the European Free Trade Association (EFTA) are backing Uber up and believe the company simply connects passengers and drivers, which should not subject it to additional regulations.

The EFTA’s lawyer said the court should “send a message that innovation and new business opportunities in the European Union should be encouraged and not hindered by submitting them to unnecessary rules.”

Earlier this year, French taxi drivers staged a three-day protest against Uber, which was marked with burning tires on main streets of the city and clashes with the riot police that clogged up traffic in Paris and brought the city to a standstill.

The ride-hailing service has also faced intense resistance in several other European countries — some of which, including Belgium, Germany and Spain, went as far as ejecting some of the company’s services out of their borders. In France, Uber was ordered by the court to pay $1.4 million in compensation to a taxi union for violating French transport law and another $170,000 in December last year for deceptive commercial practices.

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