Europe's highest court just ruled Uber is a transport service -- and it's a massive blow

GettyUber’s new chief executive, Dara Khosrowshahi.
  • Europe’s top court just found Uber to be a transport service in a major legal ruling that is likely to affect how European Union governments regulate the firm.
  • It’s a massive blow for Uber, which has consistently argued that it’s just an app, not a transport service, and therefore subject to fewer regulations.
  • The ruling will give regulators in EU member states more authority to scrutinise and regulate Uber more closely.
  • Uber is fighting multiple legal battles in Europe, including trying to regain its operator’s licence in London.

Uber is a transport service, according to Europe’s top court, a decision that is a massive blow for the firm.

The European Court of Justice issued its ruling Wednesday morning, opening up the possibility for European Union governments to regulate Uber much more closely at a local or national level or even to ban it altogether.

The court said in a statement: “The service provided by Uber connecting individuals with non-professional drivers is covered by services in the field of transport. Member States can therefore regulate the conditions for providing that service.”

Uber said the ruling wouldn’t affect its operations in countries where it already followed transport law.

A spokesman 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. This is the approach we’ll take to ensure everyone can get a reliable ride at the tap of a button.”

The ruling relates to a case originally filed by a Spanish taxi association, which argued that Uber’s Spain operations should be sanctioned and considered unfair competition. The case looked at UberPop, Uber’s peer-to-peer service that lets almost anyone with a car act as a cab driver. Uber has already withdrawn UberPop from several European markets, though it still runs in Estonia, Poland, the Czech Republic, and Finland.

While the judgement applies to Uber’s peer-to-peer service, it still contradicts how Uber has conventionally defined itself.

Uber has consistently argued that it is only an app which connects passengers to cab drivers through technology, as opposed to a transport service.

That definition has helped the firm avoid the stricter regulations which apply to conventional taxi, minicab, and other transport services. Instead, Uber has been subject to the lighter EU rules which cover digital services operating across borders.

Uber has had a terrible 2017

Uber’s legal defeat follows a string of battles in Europe and a long list of problems at the company.

After years of scandal and board infighting, the firm is under new leadership after the company’s controversial CEO, Travis Kalanick, stepped down in June. His successor, Dara Khosrowshahi, took the helm in August and promised the firm would turn a new leaf.

But that has involved uncovering some skeletons. In November, Khosrowshahi revealed that Uber had covered up a massive data breach that affected 57 million users, to the fury of regulators and governments around the world. And an explosive letter which came to light in a legal case claimed Uber secretly spied on its employees and tapped their phone calls.

In the UK, the firm’s position is looking more precarious.

The ride-hailing firm is appealing the loss of its licence to operate in London – a process that may take years, according to Mayor Sadiq Khan. It’s also appealing a UK employment tribunal ruling that classified its drivers as workers, not self-employed contractors.

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