European Union judge: Uber is in the business of transportation, not information
- Author: Essie Rivera May 13, 2017,
May 13, 2017, 0:54
As a transport service supplier, Uber may be liable for value-added tax imposed on businesses that provide goods and services. Once the trip is complete, the fare is automatically charged to the user's pre-registered bank card.
The determination that Uber is a transportation company could level the legal playing field between Uber and traditional taxi firms operating in the EU. "It is thus subject to the conditions under which non-resident carriers may operate transport services within member states, (in this case, possession of the licences and authorisations required by the city of Barcelona regulations)", Szpunar concluded.
The Advocate General's identification of Uber as a transport provider is "hugely helpful to our Value-Added Tax case", The Good Law Project, the claimant behind the United Kingdom case, said in a May 11 tweet.
This may limit the number of drivers who are able to work for Uber, which now has about 120,000 drivers in the EU.
It said that Uber "certainly can not be considered a carpooling platform" because drivers accept payment over and above the cost of providing transport.
Jolyon Maugham, the tax barrister and campaigner behind the project, told Bloomberg BNA in a May 10 telephone interview that he plans to file the case in the High Court "next week".
In a May 11 email, meanwhile, a spokesman for Uber declined to comment on The Good Law Project's tweet. The ECJ's final ruling can not be appealed by Uber, the world's most valuable venture-backed company, which is also struggling with a wave of executive departures and criticism of its work culture.
"Being considered a transportation company would not change the way we are regulated in most European Union countries as that is already the situation today", the statement said.
But warned such a ruling would "undermine the much needed reform of outdated laws which prevent millions of Europeans from access a reliable ride at the tap of a button".
Maciej Szpunar, the advocate general, said that the app does have many regulations that drivers need to abide by.
"This has been the case across the taxi and private hire industry for decades", the statement said. The app recognises the location of the user and alerts nearby drivers. In the U.K. The company is now preparing for an appeal against a U.K. court decision that its drivers should be classed as workers, rather than self-employed people who use its app. Expanding rapidly across the #UnitedStates and then internationally, it developed a reputation for launching first and dealing with regulators later.
Outside the EU, Uber has already fought tax claims in court.
It follows, he said, that Uber's activity is not governed by the principle of the freedom to provide services in the context of "information society services", and is therefore subject to the same conditions as other carriers operating transport services in European Union countries, and in this case, the regulations of the City of Barcelona. A lawyer for the Barcelona taxi drivers association said Szpunar's findings marked a "memorable day".
Europe's top court has been advised to rule that Uber should be regulated as a transport service, not an app.
In his opinion, the Advocate General concluded that Uber "must be" a transport service.