UBER UPDATE INTL
UBER’S BUSINESS HIT WITH BAN IN GERMANY
A regional court in Frankfurt banned Uber from sending ride-hailing requests to rental car companies via its app in December - with the court finding multiple competition violations. According to Techcrunch, the ruling, over Uber’s dispatching pro- cess, follows a legal challenge brought by a German taxi association. In Germany, Uber’s ride-hailing business works exclu- sively with professional and licensed private hire vehicle companies - whose drivers and cars have the necessary licences and permits to transport passengers. So the court ban essentially outlaws Uber’s current model in the country - unless it’s able to make changes to come into compliance. Uber can appeal the Frankfurt court’s judgement, but did not respond when asked whether it intends to do so. The ban was enforceable immediately. It’s not clear whether Uber will temporarily pause service in the market to come into compli- ance - it has not said it will do so, suggesting it intends to scramble to make changes while continuing to operate. But if it does that, it risks fines if it’s caught breaching the law in the meanwhile. As Reuters reports, the plaintiff in the case, Taxi Deutschland, has said it will seek immediate provisional enforcement - with the threat of fines of €250 per ride, or up to €250,000 per ride for repeated offences if Uber fails to make the necessary changes. “We will assess the court’s ruling and determine the next steps to ensure our services in Germany continue,” an Uber spokesperson said in a statement. “Working with licensed PHV operators and their professional drivers, we are committed to being a true partner to German cities for the long term.” Among the issues identified by the court as violations of German law are Uber’s lack of a rental licence; rental drivers it uses to supply the driving service accepting jobs via the Uber app without first returning to their company’s headquarters; and rental drivers accepting jobs directly in the app without the jobs being previously received by their company. Uber argues that reform of German transport law is needed to take account of digital business models and app-based dispatch. In the meanwhile, its business demonstrably remains vulnerable to legal challenges around PHVs regulations.
ISTANBUL BAN TRIGGERED PIRATE CAB BOOM
Pirate cabs are proliferat- ing in Istanbul, following a ban on Uber’s ride-hailing operations, Hurriyet news- paper reports. More than 5,000 pirate taxis are operating in Turkey’s largest city, com- municating with cus- tomers via Whats- App, Hurriyet said last month, citing a taxi associ- ation. With only 17,395 licensed cabs operating in the city of 15 million, demand for cheaper but illegal cabs is surging, the newspa- per said. In October, a court in Istanbul halted Uber’s operations on the ground they created unfair competition. The court also ruled to
FEBRUARY 2020
block access to Uber’s mobile application and website. President Erdogan had opposed the company’s presence in Turkey, likening its vehicles to pirate cabs. The inadequate supply of cab services has also resulted in a surge in medallion prices. A taxi licence plate is sold for 2.1m liras (c.£268K), according to Kenan Ticaret, a privately held company that trades medallions, up 55 per cent from the start of 2019.
MURDER OF BRAZILIAN UBER DRIVERS MAY BE ‘REVENGE’
The grisly murder in December of four drivers for Uber and another ridesharing service in a Brazilian favela may have been driven by vengeance after a gang leader’s sick mother had a ride cancelled, police have said. According to the Guardian, the four men, aged between 23 and 48, were tortured and killed after being called to the Jardim Santo Inácio favela in the north-eastern city of Salvador last month. A fifth driver made a dramatic escape and alerted police. He and two victims worked for the Brazilian transport company 99; the oth- ers for Uber. In a statement police said that the motive for the killings was still being investigated, but “one line of inquiry points towards revenge against the drivers, after a trip was refused”. Two suspects in the murders were killed in a shootout with police and officers found the body of the man suspected of ordering the murders a couple of days later. He had been shot dead. “The gangster ordered these people killed because his mother called Uber, but the car never arrived,” Bahia state governor, Rui Costa, told reporters. The surviving driver described his horrific ordeal on local television. After being called to the favela early on a Friday, he was forced from his car at gunpoint and led behind a shack, where one driver had already been killed and others were being tortured. The man was tied up, beaten and tortured, but managed to escape into a swamp when one of the other drivers grabbed a gang mem- ber’s pistol.
Rui Costa
Ridesharing apps such as Uber and 99 have boomed in Brazil in recent years. Uber has more than 600,000 drivers in the country, many of whom started working for the company after a crippling recession that left 12 million unemployed. According to Reuters, crimes against Uber drivers in São Paulo rose in 2016 after the company began accepting cash payments. The company then started demanding a social security number and date of birth from passengers paying cash. “Uber deeply regrets this brutal and shocking crime,” a spokeswom- an said, while 99 said: “We were deeply saddened by these horrific acts of violence.” Both companies said they use artificial intelligence and machine learning to map risks. Atila Santana, president of a local driver’s union, said companies should be as rigorous in choosing passengers as they are at choos- ing drivers. “They don’t want more bureaucracy because users bring money. But they put drivers at risk,” he said.
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