Uber’s expansion plans are running into obstacles in cities across the world, including in Europe.
Taxi drivers have complained that Uber, the US personal transport service, has hit their business unfairly during its rapid expansion over the four years since its launch in 2009. Uber, which is now available in 43 countries and was recently valued at $18 billion, has faced disputes with taxi operators and regulatory issues in many cities where it operates, including in San Francisco, Uber’s founding city.
Uber, which now operates in 25 European cities, has sparked legal cases and taxi protests from London to Rome. Courts and regulators have challenged the legality of certain Uber services in cities from Berlin to Barcelona. Uber has responded by challenging the decisions, hiring an array of lobbyists and public relations firms—and continuing to expand aggressively.
To the dismay of Parisian taxis, Uber decided to make the French capital its “out of the United States innovation laboratory”.
Taxi drivers in Paris had retaliated by blocking traffic into the city center in a protest against Uber in June, an action duplicated in London, Berlin and Madrid.
Taking the action further, the French Taxi Association (AFT) engaged on June 4 an urgent proceeding against Uber before the Commercial Court of Paris arguing that the invoices issued by Uber's French drivers at the time of reservation are in violation of French law since they only refer to the rate by distance and time travelled, leaving the final total to be calculated at the ride's end. The action was based on article R.231-1-4 of the French Code of Tourism which provides that
chauffeured cars (VTC) such as limousines, unlike taxis, may work only with prior reservation and the total cost of the trip must be specified when clients make their reservation.
On August 1, the Commercial Court concluded that Uber's conduct violates the law and ordered the company to change its billing procedures to inform customers how much their ride will cost when they order a car, under penalty of a fine of 15,000 euros per infringement.
The judge made a distinction between Uber’s liability before and after the ride. Before the ride, according to the judge, Uber cannot be held responsible for not complying with the French Code of Tourism since it does not exercise any decisive control over the prices set by its drivers. After the ride, however, the court found that Uber acts as its drivers’ agent. As such, it represents them and is therefore subject to the same rules.
In any case, the court's decision does not call into question the Uber business practice itself, since the company is a booking platform, not a VTC company.
Under continued pressure from taxi companies, lawmakers this autumn passed new legislation (loi Thévenoud), which entered into force on October 2. This new law bans Uber and other private car services from using GPS technology to display the locations of cars and potential customers - a key feature of the apps - and provides that such an approach can be used only by licensed taxis. The Thévenoud law also requires car services’ drivers to return to their place of dispatch between fares if they are not booked by a client for a ride.
On November 14, Uber expanded its controversial UberPop service, which via a mobile phone application connects passengers with drivers who do not have professional licenses, by adding the ability for Parisian passengers to save money by sharing their rides with strangers who have a similar route. The new function, also dubbed UberPool, was previously available only in San Francisco.
This move comes as Uber continues to face a rocky regulatory landscape in France and across Europe.
Despite this new regulation, Uber stated that it has no plans to change its app system to conform with the law, insisting the provision is unclear and should in any case be overturned.
Uber has recently launched a petition to rally French supporters to its plight and draw the European Commission’s attention to the matter. In the petition, the company portrays itself as the victim of a campaign coordinated by powerful public transportation incumbents and taxi unions. But it also takes a swipe at Thomas Thévenoud, the politician who had led the push to pass the legislation that makes it more difficult for Uber to operate in France, and who was recently forced to leave the government for failure to declare his own taxes. The company is asking supporters to sign the petition to show their support for Uber and for more competition in the French transportation market. So far, the petition has 53, 476 signatures with a goal of 60,000.
Even if it seems as though the French government and jurisdictions have favored the French taxi drivers against Uber, the California firm remains unaffected and continues to expand.