A European top court has ruled that Uber is a transport company. The ruling could have massive implications on the ride-hailing company. On Wednesday morning, The European Court of Justice issued the ruling that will now give European governments the freedom to regulate Uber at local and national level. The governments can also ban the company from operating within their borders if they see fit.
However, Uber remains upbeat despite the ruling. The California-based firm noted that its operations will go on as usual adding that the company has always followed transport laws in every EU country it operates in.
Uber also says that there are millions of Europeans who are not allowed to use its app and that the company is open to regulations. Nonetheless, Uber maintains that it will continue to pursue dialogue with various cities in the region to ensure that as many people as possible can use the app.
Uber has faced a number of legal challenges in the EU over the last few years. Just recently, a case filed by a Spanish taxi association sought to have it sanctioned from operating in the country due to what the petitioners called “unfair competition.” The case largely targeted UberPop, a peer-to-peer service that literally converts anyone with a car to a cab driver. The ride-hailing company has already withdrawn this service from a number of countries in the EU. But it’s still operational in other countries including Finland, Poland, Estonia, and Czech Republic.
Uber says that it’s simply an app that connects passengers with drivers. This definition has allowed the ride-hailing service provider to avoid the strict regulations that minicabs, taxis, and other transport services are subjected to in the EU. Until now, Uber had been considered as a digital service. Regulations for companies in this category are very favorable in Europe.
The ruling by the European Court of Justice will change everything. It’s the last thing that Uber needed this year, especially when you consider the turbulence that the company has gone through in 2017.
To start with, Uber was hit with a sexual harassment scandal a few months ago. The scandal led to the resignation of top executives at the company including former CEO Travis Kalanick.
It was also revealed in November that Uber had covered up a massive data breach that affected nearly 60 million users. The company has also been accused of spying on employees and taping their phone calls. But the biggest blow came from the UK where the ride-hailing service lost its license to operate in London. Although Uber has started the appeals process, the case could take years before it’s settled.
Despite these challenges, Uber is still one of the most valuable companies in the world. There is an increased optimism that the new leadership could steer the ride-hailing company into more prosperity in the future. However, the company will need to re-strategize in Europe now that its status as a digital service has been changed to a transport service.
