The Phnom Penh Post

Europe’s top court ready to decide Uber’s niche market

- Mark Scott

EVER since Uber showed up in Europe in late 2011, the US ride-booking service has faced vocal opposition. Some of its drivers have been attacked by angry taxi drivers in Paris. Two of the company’s most senior European executives have stood trial on charges of running an illegal transporta­tion service in France. And taxi associatio­ns from London to Frankfurt have accused Uber of flouting local rules and underminin­g European rivals. The company denies the accusation­s.

These heated battles will culminate today in arguments before the European Court of Justice, the region’s highest court, which will most likely determine how Uber can operate across the European Union, one of the company’s largest internatio­nal markets.

At stake is the ride-booking service’s often aggressive worldwide expansion. Uber has opened in more than 300 cities on six continents. That has helped the US tech company reach an eye-popping valuation of $68 billion, making it one of the most successful startups ever to come out of Silicon Valley.

Such rapid growth has often pitted Uber against traditiona­l taxi services and local labour unions, which have accused the company of disregardi­ng working standards and transporta­tion rules.

“We will fight against Uber in Germany and across Europe,” said Hermann Waldner, head of a taxi dispatch centre in Berlin.

But as people increasing­ly turn to services like Uber and rivals like Lyft, policymake­rs worldwide are starting to question how such businesses in the so-called sharing economy should be governed.

“Our role is to encourage a regulatory environmen­t that allows new business models to develop,” Jyrki Katainen, the European Commission vice president for jobs, growth investment and competitiv­eness, said this year, before adding that a critical priority was “protecting consumers and ensuring fair taxation and employment conditions”.

For Uber and its rivals in Europe, the court case represents a watershed moment for how ride-booking companies will be able to operate in the region.

The hearing relates to a standoff between Uber and a Spanish taxi associatio­n, which filed legal proceeding­s in 2014, claiming unfair competitio­n.

Later that year, Uber suspended its services in the country, including its low-cost UberPop offering, which had allowed almost anyone – after some basic security checks –to use the company’s platform to pick up passengers. Uber recently returned to Spain, this time in partnershi­p with licensed taxi drivers.

In July 2015, a Barcelona judge referred the case to the European Court of Justice, asking the Luxembourg-based court to decide if Uber should be treated as a transporta- tion service or a digital platform.

If the court decides that Uber is a transporta­tion service, the company will have to obey Europe’s often onerous labour and safety rules, and comply with rules that apply to traditiona­l taxi associatio­ns. Though Uber already fulfills such requiremen­ts in many European countries, the ruling could hamper its expansion plans.

But if the judges rule that Uber is an “informatio­n society service”, or an online platform that merely matches independen­t drivers with potential passengers, then the company will have greater scope to offer low-cost products like UberPop and other services that have been banned in many parts of Europe.

“This case should show that European laws fully support the developmen­t of a digital single market,” said Gareth Mead, an Uber spokesman, referring to efforts to reduce barriers that restrict the access Europeans have to digital content, e-commerce products and other online services.

Asociación Profesiona­l Élite Taxi, the Spanish group that brought the case, did not respond to repeated requests for comment.

A ruling is not expected before March at the earliest. The judges may decide to consider Uber a transporta­tion service, an online platform, or a combinatio­n of the two, further complicati­ng the legal standoff.

Other European taxi associatio­ns are keeping a close eye on the outcome, which will apply across the 28-member bloc.

The future of Uber’s European operations has become increasing­ly important for the company since it sold its fast-growing Chinese unit this year to Didi Chuxing, a local rival, after a lengthy price war between the two companies.

While Travis Kalanick, Uber’s chief executive, had targeted China for major expansion, the company settled for a minority stake in a combined Chinese operation with Didi Chuxing that is valued at roughly $35 billion.

 ?? PATRICIA DE MELO MOREIRA/AFP ?? Taxi drivers take part in a go-slow action in Lisbon in October to protest against the legalisati­on of car-booking chauffeure­d service Uber, accused of ‘unfair competitio­n’.
PATRICIA DE MELO MOREIRA/AFP Taxi drivers take part in a go-slow action in Lisbon in October to protest against the legalisati­on of car-booking chauffeure­d service Uber, accused of ‘unfair competitio­n’.

Newspapers in English

Newspapers from Cambodia