Continuing the Uber legal saga (see the December edition of the EU Competition Bulletin), the Paris Commercial Court was called upon in summary proceedings in November 2014 to decide whether UberPop competes unfairly with rivals such as taxis and French chauffeured cars (VTCs). VTC associations, joined by the voluntary intervention of taxi unions, sought an injunction from the Commercial Court to stop UberPop activities as soon as possible and to impose a penalty in case of non-compliance which “to have a deterrent effect, cannot be less than 250,000 euros per day”.
On December 12, the Commercial Court declined to ban Uber Technologies Inc. from operating UberPop, its service that uses drivers without professional licenses who offer trips in their own cars for fares which are cheaper than those of taxis or VTCs.
Furthermore, in its decision, the Commercial Court stated that it is up to a French Criminal Court to decide whether or not Uber should be fined.
Nonetheless, the Commercial Court ordered Uber to withdraw from its app “all mention suggesting it is legal” for Uber's French drivers to stop, park or circulate on public roads while waiting for a potential client, under a daily fine of € 20,000 for non-compliance.
Although the Court noted that Uber did not contest its non-compliance with provisions of the French Transport Code deriving from the Thévenoud Law, which regulates taxis and VTCs, it stated that it could not rule on the possible violations or issue an injunction in consequence before the decrees implementing this Law have been published, and, so long as the Constitutional Council has not decided on the constitutionality of certain provisions thereof contested by Uber (assuming that the French Supreme Court will consider that Uber’s contestations raise serious issues).
In this regard, the Commercial Court granted Uber’s request to ask the highest French constitutional authority, the Constitutional Council, to judge the constitutionality of certain elements of the Thévenoud Law. The provisions Uber is contesting include one that bars non-taxi companies from showing the location of nearby vehicles on a map, and another that bars anyone other than taxis from using precise time and distance measures to calculate fares.
In regard to the first contested provision, the Commercial Court found it justified to ask the Constitutional Council whether or not to reserve to taxis all access to “a practice permitted by technical progress, which may facilitate customer demands, improve the productivity of all carriers and reduce vehicles’ travel on public roads in the interest of the environment is a disproportionate interference with the freedom of entrepreneurship.”
As to the second contested provision, the Commercial Court also found it justified to ask the Constitutional Council whether or not reserving to taxis the ability to calculate fares by distance and time travelled violates the principle of equality on the market of booked trips on which VTCs (and potentially, Uber as its drivers’ agent) are in competition with taxis.
Moreover, the Commercial Court denied the plaintiffs’ request not to suspend its ruling on Uber’s method of fare calculation while awaiting for the Constitutional Council’s decision, as the Court considered that waiting for the Constitutional Council to rule would have no irreparable or manifestly excessive consequences for the VTCs.
The French Supreme Court will now examine the merits of the two constitutional questions proposed and decide whether or not such questions raise serious issues which should be transmitted to the Constitutional Council. If the questions are indeed submitted to the Constitutional Council, its decision on their constitutionality is not expected before the end of 2015.
On December 15, in an effort to appease the dissatisfied taxis who protested against the Commercial Court’s decision by blocking traffic into Paris, the French Government announced that UberPop would be banned as from January 1, 2015, as soon as the decrees implementing the Thévenoud Law will be promulgated.
In the meantime, as result of the suspension of the Commercial Court’s decision until a ruling of certain of the Thévenoud Law provisions, Uber has won time during which it has stated it will continue to operate its UberPop service.
Uber is also awaiting a decision in its appeal against the October 16, 2014 verdict of the Paris Criminal Court, in a case brought by taxi and limousine companies, where it was ordered to pay a € 100,000 fine for “deceptive business practices” for having advertised its paid transportation service UberPop as a car pool, which decision is not expected for several months.