Uber isn’t a benign platform offering to ferry people from A to B via a simple app—it’s a transportation service and as such must comply with the relevant rules, a law adviser at Europe’s top court has said.
In a nonbinding opinion, advocate general Maciej Szpunar concluded that “the service offered by Uber cannot be classified as an ‘information society service’.” If the Court of Justice of the European Union (CJEU) agrees with Szpunar, Uber will face a major regulatory setback that could hobble its expansion plans.
In the majority of judgments, Europe’s highest court sides with the advocate general’s opinion.
Uber’s status was examined by Szpunar after a Spanish taxi lobby group—representing drivers in Barcelona—challenged the US company’s classification under EU law. Elite Taxi argued that Uber was sidestepping tough regulatory rules, while local cab services were obliged to adhere to the bloc’s transportation rules. A Barcelona judge subsequently referred a number of questions in the case to the CJEU.
Notably, while the CJEU will pass a binding judgment on the validity and interpretation of the relevant EU law in light of Szpunar’s conclusions, it will be the court in Barcelona that ultimately rules on the Uber case.
“The Uber electronic platform, whilst innovative, falls within the field of transport,” said Szpunar on Thursday. “Uber can thus be required to obtain the necessary licenses and authorisations under national law.”
This means that Uber’s claim to be just an app could hit a red light in Europe, forcing it to comply with strict transport rules, such as licensing requirements. Szpunar said in his non-binding opinion that Uber’s smartphone app is “a secondary component” to its business. He added: “It is undoubtedly transport which is the main supply and which gives the service meaning in economic terms.”
Uber has long claimed it offers an “information society service” and markets its taxi app as a “digital economy” champion. But it has faced battles with taxi drivers and regulators across Europe. In the UK, it recently lost a legal fight over driver exams with Transport for London, which has also threatened to jack up private-hire operator licence fees.
For scandal-hit Uber, it’s business as usual in Europe while it awaits the CJEU’s judgment, which isn’t expected until later this year. The company said: “Being considered a transportation company would not change the way we are regulated in most EU countries as that is already the situation today.” It argued that reform of “outdated laws” was “much needed.”