The European court of justice has ruled that ride-hailing service Uber is a transportation company.
While this may sound fairly obvious to anyone that has ever used the service, Uber has up until this point been operating as a computer services business that connects users with drivers. This has allowed it to operate with looser regulations and licensing under EU law.
There are specific laws laid out in the EU to allow freedom of providing services digitally, which expressly excludes transportation services. Uber getting reclassified changes the freedom with which it is allowed to regulate.
According to Uber, it’s going to be business as usual. A spokesperson has 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.”
Uber has for the longest time not owned vehicles, or technically employed drivers, presumably to jump through the loopholes of business classification. It will be interesting to see if being classified as a transportation company does anything to change the rights for the drivers who work for Uber.
It’s also unclear whether these changes will affect the service for the consumer. If the company has to adhere to more rules, it would stand to reason that its expenses will go up, and those extra expenditures would most likely work their way back to the users.
The court hearing came after a Barcelona based taxi company called Elite Taxi took Uber to court, which was then passed up to the European court of justice, which ruled: “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.”
Via The Guardian