ECJ’s Uber ruling has widespread implications for gig economy

Europe’s top court rules Uber is a taxi service rather than an app

Uber, London
(Image credit: Getty Images)

Uber is a taxi service that must comply with national laws, the European Court of Justice decided today in a ruling that has major implications for the wider gig economy across the 28-member EU bloc.

The court challenge was brought by a Barcelona taxi drivers’ group, which argued that Uber was directly involved in carrying passengers. Uber’s lawyers insisted the company was a “computer services business” and should therefore be subject to an EU directive governing e-commerce.

“This classification has helped shield the multibillion-dollar company from obtrusive national regulation where it is treated as a digital service subject to fewer rules when operating across borders in the EU’s single market,” reports the Financial Times.

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But the ECJ has ruled that since the US firm connects individuals with non-professional drivers in Europe, it should be covered by services in the field of transport.

That means Uber should be regulated like a taxi company, not a tech company, says Channel 4 News economics correspondent Helia Ebrahimi.

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“It’s the first ruling by the bloc’s court on how an app such as Uber should be qualified and it has been closely watched by the technology industry, because it could set a precedent for how firms in the burgeoning gig economy are regulated across the 28-nation bloc,” Bloomberg says.

Uber said the ruling “will not change things in most EU countries where we already operate under transportation law”.

However, BBC business correspondent Dominic O’Connell says there are larger implications for the company around the world, “because what Europe does on regulation often tends to be followed by other countries, and also for the whole gig economy because it means that Europe is taking quite a dim view of this idea of companies simply being information services or platforms. They are saying they are actually real operators.”

Professor Andre Spicer, of London’s Cass Business School, told BBC Radio Four’s Today programme that the court has made it clear that Uber is “not a ride-hailing app, it is a transport company”. The ruling could have implications for companies such as Google, Facebook and other tech companies offering services in Europe, he added.

“I don’t click on the app and say I want an information-sharing platform - I want a ride,” Spicer said.

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