Taxi app Uber banned in Germany

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11 September, 2014

Due to an injunction by the German Court (Landsgericht Frankfurt) last Thursday, the innovative taxi service Uber is now banned across Germany. According to the Court, Uber is not allowed to offer their taxi services without an official permit. If they do not comply, Uber risks a fine of 250 000 euro per infringement or directors risk a prison sentence.

The action was brought by the German taxi industry organization, Taxi Deutschland Servicegesellschaft für Taxizentralen. Uber allows non-professional drivers and passengers to mediate through Uber’s apps. According to the German organization, the apps Uber and UberPOP lead to unfair competition in the market, because the drivers do not have to meet the formal standards for regular taxi drivers. Especially UberPOP raised a lot of commotion, since this application allows non-professional drivers to offer rides to consumers. Moreover, the German organization feels that the Uber apps compete with its own taxi-service app.

Last Thursday, the German court has confirmed the statement of the German organisation and gave an injunction. Uber’s drivers are obliged to have a valid permit in order to offer their taxi services. If Uber ignores the injunction, they risk a fine of 250 000 euro per infringement or the directors risk a prison sentence.

Germany isn’t the first country that restricts Uber’s activities. Earlier, a Belgian judge took measures that lead to a formal ban of Uber in Brussels. In the Netherlands, UberPOP drivers risk a fine if they offer their services via the UberPOP app. Despite the risk of a fine, Uber has stated in all cases that they will continue to offer their activities because Uber believes that innovation and competition is beneficial for both the passengers and the drivers.

Uber is an example of an innovative technology that conflicts with existing legislation. In order to prevent restrictions on your innovative technology, it is useful to examine what the legislative challenges are before launching a service.

Source: Techcrunch

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Jonathan Toornstra

Legal Consultant

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