Uber a transport firm, not a digital service: European Union court

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The case originates from a complaint by a professional taxi drivers' association in Barcelona. The drivers maintained that Uber drivers should be subject to authorizations and license requirements and accused the company of engaging in unfair competition.

In a landmark ruling published on December 20, the ECJ discounted Uber's assertion it was simply a digital platform acting as an intermediary between riders and taxi drivers.

With the ruling by Europe's highest court, Uber can now be regulated as a transport service at the national level within the EU's member states.

While Uber publicly shrugged off the blow, the decision will likely still affect its future operations and political maneuvering in the EU. Maciej Szpunar, advocate general at the EU Court of Justice, had already announced his decision that Uber was a transport company back in May, but his opinion wasn't binding.

In Uber's case, the company has faced or brought lawsuits - including anti-competitiveness claims and labour disputes - in a number of countries in the European Union and North America.

But EU judges disagreed, ruling that Uber's "main component is a transport service".

"Uber can thus be required to obtain the necessary licences and authorisations under national law", he said.

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However, the PPF's support is needed for the CVA to be voted through at a meeting of creditors scheduled for 19 December. The company is seeking a company voluntary agreement (CVA), giving it a breathing space to restructure its finances.

The court also pointed out that Uber exercises "decisive influence" over the conditions under which drivers provide their services.

"It will however hurt the necessary reform of outdated laws which prevent millions of Europeans being able to find a reliable ride with just one click", the spokesman said. In France, for example, Uber's low-priced service involving independent, unregulated drivers is banned, but Uber operates a popular ride service involving licensed drivers that competes with traditional taxis.

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.

"Uber is indispensable for both the drivers and the persons who wish to make an urban journey", the court stated.

SBC Abogados said in a statement that the ruling had "great judicial significance" and that it could be "extrapolated to other businesses that keep trying to avoid legal responsibilities in the services that they provide".

However, a group representing online companies warned that the ruling goes against EU efforts to encourage innovation and help European entrepreneurs compete with US and Asian rivals. "Member States can therefore regulate the conditions for providing that service".

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