Yahoo Finance Why is Uber going to court in London - and will it win back its licence?
Transport for London refused to hand Uber a new licence to operate in London in September, and the company is now appealing the decision in court.
The company has millions of riders in London, but it has come under fire for the ways its business has been run. Uber is now hoping that it's made enough changes to get a new licence.
Why is Uber going to court?
Uber is appealing a September decision by London’s transport regulator Transport for London. The regulator declined to issue a new private hire operator licence to Uber, which is the crucial licence that the company needs to operate in London.
Uber has appealed TfL’s decision, which has kickstarted a legal process. The appeal will be held in Westminster Magistrates Court, and a judge will rule on whether Uber is currently fit and proper to be given a new private hire operator licence.
Who decides what happens?
TfL announced its decision not to renew Uber’s licence in September. Now that Uber has started a legal appeals process, TfL will let the judge decide whether Uber should get a new licence. TfL will follow the judge’s decision and grant or decline to give a licence accordingly.
What were TfL’s issues with Uber?
TfL said in September that it thought that “Uber's approach and conduct demonstrate a lack of corporate responsibility in relation to a number of issues which have potential public safety and security implications.”
The regulator went on to list several issues that it had with Uber’s business. It said that it was unhappy with the companies that Uber used to conduct background and medical checks.
It also took issue with Uber’s approach to reporting crimes that happen to its customers and drivers. At the time, Uber relied on passengers and riders to report crimes, and didn’t take a proactive approach to reporting them itself.
Finally, TfL criticised Uber’s alleged use of its “Greyball” software, which allowed the company to show different versions of its app to different users. The New York Times reported that Uber had used the software in some cities around the world to change which cars were shown to users who were suspected of working for regulators.
What has Uber done since September?
Uber has made a series of changes to its business in the UK following TfL’s decision in September.
The company has changed its background and medical checking suppliers to use companies that TfL is happy with. The company has also started proactively reporting crimes itself to The Metropolitan Police.
Uber’s European head sent an email to staff in September which denied that the Greyball tool had been used to dupe regulators in the UK. The company has admitted that the software is used for feature testing, though.
And Uber has also appointed three independent non-executive directors to its board in the UK, which it hopes will help to stop worries over the company’s corporate responsibility.
As well as directly responding to TfL’s concerns, Uber has also started paying UK drivers sick pay and parental leave. It’s also launched a special telephone helpline for passenger and its drivers.
What does Uber want?
Uber wants a new private hire operator licence which will allow it to operate in London. The company has said in written evidence that an 18 month licence would be appropriate.
What happens if Uber wins?
If the judge rules that Uber is fit and proper to hold a private hire operator licence then TfL is expected to grant the company a licence, and it will continue to operate as normal.
What about if Uber loses?
And if Uber loses, then there won’t be a sudden removal of its service in London. The company intends to work through the appeals process, meaning that if the Magistrates Court doesn’t rule in its favour, then it can continue appealing through to the Supreme Court.
London mayor Sadiq Khan has said that the full appeals process could take years, and Uber is able to continue to operate until it exhausts all avenues of appeal.
What are the alternatives to Uber?
Uber isn’t the only ride-sharing company in London. Rival services include Gett, mytaxi and minicab company Addison Lee.
