CJEU: Uber is a transport service provider under EU law

About this case:

• Judgment:
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The court said Uber provides, by means of a smartphone application, a paid service consisting of connecting non-professional drivers using their own vehicle with persons who wish to make urban journeys.

In 2014, a professional taxi drivers’ association in Barcelona (Spain) brought an action before the Juzgado de lo Mercantil No 3 de Barcelona (Commercial Court No 3, Barcelona, Spain) seeking a declaration from that court that the activities of Uber Systems Spain, a company related to Uber Technologies (together ‘Uber’), amount to misleading practices and acts of unfair competition.

Neither Uber Systems Spain, nor the non-professional drivers of the vehicles concerned, have the licences and authorisations required under the Regulation on taxi services in the metropolitan area of Barcelona.

In order to determine whether the practices of Uber can be classified as unfair practices that infringe the Spanish rules on competition, the Juzgado de lo Mercantil No 3 de Barcelona considered it necessary to ascertain whether or not Uber requires prior administrative authorisation.

The court considered that it should be determined whether the services provided by Uber are to be regarded as transport services, information society services or a combination of both. If the service at issue were covered by the directive on services in the internal market or the directive on electronic commerce, Uber’s practices could not be regarded as unfair.

In today’s judgment (not yet available in English), the Court declares that an intermediation service such as that at issue in the main proceedings, the purpose of which is to connect, by means of a smartphone application and for remuneration, non-professional drivers using their own vehicle with persons who wish to make urban journeys, must be regarded as being inherently linked to a transport service and, accordingly,must be classified as ‘a service in the field of transport’ within the meaning of EU law.

Consequently, such a service must be excluded from the scope of the freedom to provide services in general as well as the directive on services in the internal market and the directive on electronic commerce.

It follows that, as EU law currently stands, it is for the Member States to regulate the conditions under which such services are to be provided in conformity with the general rules of the Treaty on the Functioning of the EU.

The Court takes the view, first of all, that the service provided by Uber is more than an intermediation service consisting of connecting, by means of a smartphone application, a non-professional driver using his or her own vehicle with a person who wishes to make an urban journey. Indeed, in this situation, the provider of that intermediation service simultaneously offers urban transport services, which it renders accessible, in particular, through software tools and whose general operation it organises for the benefit of persons who wish to accept that offer in order to make an urban journey. The Court notes in that regard that the application provided by Uber is indispensable for both the drivers and the persons who wish to make an urban journey. It also points out that Uber exercises decisive influence over the conditions under which the drivers provide their service.

Therefore, the Court finds that that intermediation service must be regarded as forming an integral part of an overall service whose main component is a transport service and,accordingly,must be classified not as ‘an information society service’ but as ‘a service in the field of transport’.

The Court states that, consequently, the directive on electronic commerce does not apply to that service, which is also excluded from the scope of the directive on services in the internal market. For the same reason, the service in question is covered not by the freedom to provide services in general but by the common transport policy. However, non-public urban transport services and services that are inherently linked to those services, such as the intermediation service provided by Uber, has not given rise to the adoption of measures based on that policy.