Status of Uber as Transport Services Company: ECJ Confirmation
09/07/2018

On 10 April 2018, the Grand Chamber of the Court of Justice of the European Union (the “ECJ”) delivered a judgment confirming that Uber’s UberPop ridesharing service is a “service in the field of transport” within the meaning of Article 2(2)(d) of Directive 2006/123 of 12 December 2006 on services in the internal market (the “Services Directive”) (ECJ, 10 April 2018, Case C-320/16, Uber France SAS v. Nabil Bensalem). Article 2(2)(d) of the Services Directive excludes transport services from the Directive’s scope. The ECJ delivered its judgment in response to a request for a preliminary ruling from a Lille Regional Court. The dispute dealt with a private prosecution and civil action brought against Uber France SAS (“Uber”) by a taxi driver based, inter alia, on a newly introduced provision of French criminal law which prohibits and penalises the organisation of a system for putting customers in touch with persons who engage in the carriage of passengers by road without authorisation. In the case giving rise to the preliminary reference, Uber was charged with the “unlawful organisation from 1 October 2014 onwards of a system for putting customers in contact with persons carrying passengers by road for remuneration”.

Uber maintained that the French legislation constituted a technical regulation which concerns an information society service within the meaning of Directive 98/34/EC of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations and of rules on information society services (the “Directive on Information Society Services”). That Directive requires EU Member States to notify the European Commission (the “Commission”) of any draft rules laying down technical regulations relating to products and information society services, failing which those rules will be unenforceable against individuals. In the present case, the French authorities had not notified the legislation in question to the Commission prior to its promulgation.

In essence, the reference for a preliminary ruling sought to establish whether the provision of French law must be classified as a rule on information society services, subject to the obligation of prior notification to the Commission, or whether, conversely, the provision concerns a transport service, which is excluded from the scope of the Directive on Information Society Services and the Services Directive.

In relation to the legal classification of the service provided, the ECJ followed the reasoning which it had developed earlier in Case C-434/15, Asociación Profesional Élite Taxi v. Uber Systems Spain SL (“Uber Spain”) (see VBB on Belgian Business Law, Volume 2017, No. 12, available at www.vbb.com). In that case, the ECJ held that while in principle an intermediation service that enables the transfer, by means of a smartphone application, of information concerning the booking of a transport service between the passenger and the driver meets the criteria for classification as an “information society service”, Uber’s commercial offering consists of more than an intermediary service and its service is “inherently linked” to the offer of transport services. The ECJ noted that Uber is involved in the selection of the non-professional drivers and provides them with the application required to connect with service users. Moreover, Uber exercises a decisive influence over the conditions under which services are provided by the drivers, for instance by: (i) determining a maximum fare; (ii) receiving the fare from the passenger; (iii) subsequently forwarding the fare to the driver; and (iv) exercising a degree of control over the quality of the vehicle and the conduct of the driver.

Therefore, in Uber Spain, the ECJ reached the conclusion that Uber’s intermediation service has to be regarded as forming an integral part of an overall service the main component of which is a transport service and that, accordingly, Uber offers a “service in the field of transport”. In the present case, the ECJ was of the opinion that the UberPop service on offer in France is essentially identical to the service provided in Spain. However, it instructed the Lille Regional Court to verify this, based on the concrete facts.

Accordingly, subject to that verification, the ECJ concluded that the French legislation cannot be classified as a rule on information services and that, therefore, the obligation of prior notification to the Commission did not apply.

The overall result of this classification of the UberPop service as a “service in the field of transport” is that Uber must comply with the relevant rules for taxis and other transport companies.

This is consistent with a judgment of the President of the Brussels Commercial Court of 23 September 2015 in which, to the extent that the remuneration of UberPop drivers exceeds the actual costs which they incur, UberPop was considered to be a “taxi service” pursuant to Article 2, 1° of the Ordinance of the Brussels Capital Region of 27 April 1995 on taxi services and vehicle location services with driver (Ordonnantie van het Brussels Hoofdstedelijk Gewest van 27 april 1995 betreffende de taxidiensten en de diensten voor het verhuren van voertuigen met chauffeur/Ordonnance de la Région de Bruxelles-Capitale du 27 avril 1995 relative aux services de taxi et aux services de location de voiture avec chauffeur) and thus subject to the licensing requirements contained in Article 3 of the same Ordinance (see VBB on Belgian Business Law, Volume 2015, No. 10, available at www.vbb.com).

By Koen T’Syen and Charlotte Woolfson

Related : Van Bael & Bellis

[+ http://www.vbb.com]


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