September 2, 2014
German Court Issues Temporary Injunction Banning Uber Ride-Sharing Service
Chuck Bednar for redOrbit.com – Your Universe Online
Uber, the rapidly-growing US-based online ride-sharing service, has been hit with a temporary injunction by a Frankfurt court prohibiting it from operating throughout Germany, various media outlets have reported.
According to Ben Knight of The Guardian, the court rules that the mobile app and chauffeuring service violated that country’s Passenger Transportation Act. The injunction, which was issued following expedited proceedings, will remain in effect until a full hearing takes place and threatens Uber with a €250,000 (approximately $328,000) fine per ride.
The case against the ride-sharing service was brought by Taxi Deutschland Servicegesellschaft (TDS), which operates an app that links smartphone users to registered taxi drivers, Knight added. The company claimed that Uber was not a legitimate service since its drivers lacked the proper permits, were not adequately insured, and were not subject to any oversight. A TDS representative said the company was “very happy” with the ruling.
Arne Hasse, a spokesman with Frankfurt state court, told the Associated Press (AP) that the decision means that Uber cannot offer its services without a specific permit required by German transportation regulations. The ruling also comes after authorities in Berlin banned the service from operating in the nation’s capital due to safety concerns, the wire service added.
In a statement, San Francisco-based Uber said that it would use "all legal means" to fight the case, and according to Christopher Williams of The Telegraph, the company vowed that it would continue servicing German customers in spite of the temporary nationwide ban and the threat of the hefty fines attached to that injunction.
A company spokesperson told BBC News reporter Kevin Rawlinson that the ban was not enforceable while the appeals process was ongoing. Rawlinson noted that a check of the company’s app verified that drivers were still offering to pick up customers in several German cities, including Munich, Berlin, Hamburg, Frankfurt and Dusseldorf.
“Germany is one of the fastest growing markets for Uber in Europe. We will continue to operate in Germany and will appeal the…lawsuit,” that spokesperson explained. “You cannot put the brakes on progress. Uber will continue its operations and will offer UberPop ridesharing services via its app throughout Germany.”
“The law says there are safety regulations for drivers and safety regulations for users, and these also apply to neo-liberal firms like Uber,” Floetenmeyer told the Guardian, adding that since Uber said that they planned to ignore the verdict, that TDS would formally petition the court to enforce the relevant fines.
“If you get into a car, you are legally in the hands of the driver with your life and your personal health and safety, and the driver has to play by the German rules,” she continued, noting that the company could also seek to have additional fines imposed on drivers using the Uber app. “If they don't play by the rules, this is worth up to €25,000 (about $32,800) per drive, per driver.”
This is a high-stakes legal battle for Uber, whose German userbase has grown fivefold this year alone, explained Reuters reporter Eric Auchard. The firm, which is currently valued at $18.2 billion, has expanded into nearly 150 cities worldwide since launching in March 2009 and has been hit with regulatory challenges since day one, largely pertaining to whether or not its drivers should be specially licensed and fully insured to carry passengers, he added.
“Even in its home city of San Francisco, Uber has had to overcome legal and regulatory hurdles from city authorities concerned its services sidestep rules governing commercial transport and by taxi companies hoping to keep competition out,” Auchard said.
“Taxi drivers across Europe caused chaos in June by protesting against the service but Uber services have continued to grow in popularity,” he added. “Uber last week said it was experiencing ‘huge demand’ for its services in German cities… and that it planned to expand into Cologne and Stuttgart by the end of this year.”