EU court advises challenge to Uber business model

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Uber provides a transport service and must be licensed, an adviser to the European Union’s top court said on Thursday, in a potential blow to the U.S. firm which says it is merely a digital enabler. Harvey Biggs reports

(REUTERS / UBER) – The EU’s top court has applied the brakes to Uber’s ambitions in Europe ..

reccomending the U.S firm provides a transport service and must be licensed.

It’s a blow for the ride-sharing company, which claims it is merely a “digital enabler” – allowing it to bypass strict local licensing and safety rules.

Though a non-binding opinion, the determination by the Court of Justice is followed by its judges in most cases and a ruling can thus require Uber to obtain local licensing and authorisations.

The case was brought by an association of Barcelona taxi drivers – the latest group to take Uber to court since the company expanded into Europe five years ago – arguing it has created an unfair market.

Reuters Transport Correspondent Julia Fioretti says the ruling is unlikely to change how the company operates.

REUTERS TRANSPORT CORRESPONDENT, JULIA FIORETTI,
“Consumers will be affected because launching peer-to-peer car-sharing services such as UberPOP will be… could be made harder, if a final ruling comes down, and it could… Uber X, which is the licensed service, could be a little bit more expensive as a result of added regulations and safety requirements, and so yes we could see Uber X slightly hampered in its expansion and therefore less availability for consumers.”

In a statement, Uber said it would await the final ruling later this year, but added it wouldn’t change how it is already regulated in most EU countries.

But warned such a ruling would “undermine the much needed reform of outdated laws which prevent millions of Europeans from access a reliable ride at the tap of a button”.

Once again, showing that this rapidly growing company has no intention of being knocked out of the fast lane.

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