Uber a transport provider, rules EU court

The EU Court of Justice (ECJ) on Wednesday rejected Uber's claim that it is a technology platform connecting passengers with independent drivers, saying that it was a transportation company, and therfore subject to the same rules as taxi services.

The ECJ has ruled that the services provided by Uber are 'services in the field of transport' within the meaning of EU law, rather than 'information society services', and it is therefore for member states to determine how to regulate the conditions under which it provides its services.

Uber's service connects customers via a smartphone app to non-professional drivers who provide car rides in their own vehicles.

An association of professional taxi drivers in 2014 brought an action before a Barcelona Commercial Court calling for Uber's activities in the city to be termed unfair practices in violation of Spanish competition law.

The association pointed out that Uber and its drivers operated as a taxi service without the licences and authorisations required by Barcelona transport law.

The Barcelona court referred the matter to the ECJ, which to decide whether the services provided by Uber should be regarded as transport services, information society services or a combination of both.

If the services were wholly information society services, protection under the Directive on Services in the Internal Market and the Directive on Electronic Commerce would be applicable, and its activities could not be regarded as unfair practices.

The ECJ considered Uber's role to be "more than an intermediation service consisting of connecting, by means of a smartphone application, a non-professional driver using his or her own vehicle with a person who wishes to make an urban journey."

Meanwhile, commentators point out that the EU position is in stark contrast to the view in US, where states have passed broad-based laws governing ride-sharing businesses. In the process they allowed ride sharing apps such as Uber and Lyft Inc to sidestep regulations that apply to traditional taxi-industry.

''There's a philosophical issue that we don't have here,'' insurancejournal.com reported quoting Matthew Daus, a lawyer and former chairman of the New York City Taxi & Limousine Commission. ''The US approach to policy has been more heavily driven by tech-based capitalism, while the European response has been to put the brakes on services that are not licensed businesses.''