Ride hailing phone app Uber is a taxi service and can be regulated, an EU Court has ruled.
The ruling from Europe’s highest court found that Uber “must be regarded as being inherently linked to a transport service and, accordingly, must be classified as ‘a service in the field of transport’??????”.
In short this means Uber has now been officially recognised as a cab company rather than a technology company, as the company had argued.
One implication of the ruling is that the company will now be regulated as transport company, meaning that rules can be set at country level.
In contrast, rules for digital platforms are set Europe-wide.
While the long-running case, which originated in Spain, is not legally binding but is likely to foreshadow the decision in the majority of cases.
Uber has previously insisted that the outcome of this case will not affect its business.
As a transport service, the taxi-hailing app will be “excluded from the scope of the freedom to provide services in general” as well as “on services in the internal market and the directive on electronic commerce”.
Importantly, the court says Uber should be classified as “a service in the field of transport” rather than “an information society service”.
For this reason Uber’s intermediation service must be regarded as forming an integral part of an overall service whose main component is transport.
The court hearing result comes on the same day as Uber returns to court to outline an appeal against its London licence.
In September, Transport for London said it would not renew the company’s private hire licence after finding it is “not fit and proper” to hold one.
Licensed as a private hire company in London in 2012, it has rapidly grown and now has about 40,000 drivers in the capital, and is used by about 3.5 million people.
Uber’s success has posed a challenge to the capital’s traditional black cabs, but it has been caught up in the backlash against the so-called gig economy.
Uber will continue to operate in the London ahead of their appeal, which is due to be heard next year.
Meanwhile, five-year licences have been granted for to the company to operate in Cambridge and Sheffield.
The international company operates in more than 600 locations around the world, including more than 40 towns and cities in the UK.