The European law regulates and protects online services from undue restrictions and the national governments have an obligation to notify the European Commission of any measure regulating them, in order to not be discriminatory or disproportionate.
In this case, transport services are regulated at national and local level. “Any ruling will not change things in most EU countries where we already operate under transportation law” a spokesperson for Uber declared.
The Uber case was brought up in front of the Court by professional taxi drivers in Spain who argued that Uber has an unfair advantage because its drivers on UberPop service did not have the taxi licenses required by the city of Barcelona. The Spanish Court referred the case to the European Court of Justice.
This month, the European Court of Justice decided that Uber is at heart a transportation company and should be regulated as such. Therefore, Uber can be now subject to stricter licensing requirements that apply normally to traditional taxi companies.
Uber declared that the ruling “will not change things in most EU countries where we already operate under transportation law.” Nevertheless, it will limit the company’s ability to use drivers who do not have professional licenses – a service already offered in only a few European markets. The downside to this ruling will be that the Uber rides in Europe could become more expensive, as the company will be required to collect sales taxes from consumers. Farr says: “would immediately increase the cost of fares by 20%.” However, this decision it is not open to Appeal.
The company has, for example, paused its services in Finland and Norway so that it can re-launch under new transport regulations. It now only operates unlicensed services in Poland, the Czech Republic, Slovakia, and Romania, although in the first two Uber is switching its drivers to operate under local transportation law.
The Computer & Communications Industry Association (CCIA), of which Uber is a member, said the ruling will ”decide over the ability of the EU to ensure online services are not unduly restricted by member states.
“The judgment will either promote the digital single market or lead to more market fragmentation for online innovators,” said Jakob Kucharczyk, vice president for competition and EU regulatory policy at the lobby group.