Uber’s ride-hailing services in Germany have been banned in seven cities after a court found it lacks appropriate licence
More bad news for Uber after a court in German on Thursday banned its ride-hailing services in the country.
It ruled that the American firm lacks a necessary licence to offer passenger transport services using rental cars, Reuters reported.
It comes after Uber last month lost its licence to operate in London for a second time after Transport for London (TfL) discovered more than 14,000 rides by unauthorised drivers in late 2018 and early 2019, and claimed it had put passenger safety at risk.
Uber had also briefly lost its London licence in 2017 due to safety concerns.
In Germany though, Uber is said to be active in seven cities including Frankfurt, Berlin and Munich. Uber exclusively works with car rental companies and their licensed drivers.
The verdict is effective immediately but can be appealed, Reuters reported.
“We will assess the court’s ruling and determine next steps to ensure our services in Germany continue”, an Uber spokesperson was quoted as saying.
A person close to the company reportedly said that Uber will now change the way it operates in Germany, adding that it is also considering taking legal action against the ruling.
The court ruling was welcomed by the plaintiff, Taxi Deutschland, which said it would seek immediate provisional enforcement.
The ruling reportedly means that Uber will have to pay fines starting at 250 euros per ride and rising to as much as 250,000 euros per ride in the case of repeated offences.
It seems that Uber was having to contend with previous court rulings in Germany. The court in 2015 reportedly banned Uber from matching up drivers using their own cars with ride hailers.
So Uber’s current service lets customers hail rides that are carried out in rented cars. The only problem is that the court has now ruled that this is also illegal, as it violates competition rules.
Uber advertised rides to customers in a way that led them to view it as the provider of the transport service, the court reportedly said, adding that the firm also selects specific drivers and determines prices.
“From a passenger’s point of view, Uber provides the service itself and is therefore an entrepreneur,” the presiding judge said. This meant Uber has to comply with laws governing passenger transport.
Separately, Uber reportedly breached the obligation that hired cars have to return to a rental firm’s main office after carrying out a ride, the court said.
Besides London and now Germany, Uber is experiencing problems in a number of countries. It has been closed down in Copenhagen and Hungary for example.
It appealed the London ban last week.
Although it is facing regulatory troubles, the company took a bold step in the past year for its investors.
Uber began trading on the New York Stock Exchange earlier in 2019 in the year’s biggest IPO to date.