2017 just isn’t Uber’s year. Aside from hiring Dara Khosrowshahi, the company doesn’t have much to show for itself, other than a slew of scandals. Khosrowshahi’s arrival marked a change in tune at the top of the company, but the new CEO still has to fix plenty of problems created by the former leadership. And Uber was just dealt a massive blow in Europe, where a court ruled the company has to abide by cab regulations.
This one is an old battle that Uber has been fighting in various countries. Uber always defended itself by saying it’s not a genuine taxi service. Instead, it’s an app that acts an intermediary between drivers and customers looking for rides. Therefore, Uber argued, it should not be regulated like a cab company.
However, the European Court of Justice believes otherwise.
“The service provided by Uber connecting individuals with non-professional drivers is covered by services in the field of transport,” the ECJ said, per Reuters. ““Member states can, therefore, regulate the conditions for providing that service.”
And it’s likely that member states will act accordingly.
The ECJ says that Uber “exercises decisive influence over the conditions under which the drivers provide their service.” Furthermore, without the mobile app, the “persons who wish to make an urban journey would not use the services provided by those drivers.”
Reuters says the decision will not have an immediate impact on Uber’s operations, as the company has cut back the use of unlicensed services like UberPOP. However, it’s still a landmark ruling against the company, which may influence Uber’s future, as well as other companies.
“This ruling will not change things in most EU countries where we already operate under transportation law,” an Uber spokeswoman said. “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.”
