Seoul looks to ban Uber, develop similar app of its own

Business & Economy -

Ride-sharing services such as Uber face opposition from regulators and transportation rivals nationwide and in several countries.

Circa News

Seoul's metropolitan government said July 21 that it would seek to ban Uber because the ride-sharing service is illegal. The government added that it would deploy a similar app of its own this December. Uber said the possible ban shows that Seoul is in "danger of remaining trapped in the past."

With minor revisions, the Seattle City Council on July 14 passed a deal, brokered by the city's mayor in June, to lift an earlier decision by the council to limit cars working with ride-sharing companies to 150 concurrent vehicles. It also sets insurance requirements for ride-sharing vehicles.

"We're hoping to use [the licenses] to improve our business because now they have a value that wasn't recognized before." Amin Shifow, Seattle Yellow Cab general manager

In the deal, taxi companies received a promise of 200 new licenses over 4 years (the city had previously not issued any new licenses since 1990), as well as instituting medallions, which taxis can use as collateral to take loans to upgrade their vehicles.

Transport for London (TfL), the city's transportation regulator, concluded July 3 that Uber is acting lawfully within the city, and said that it will not pursue legal action against the company. Uber called the decision a "victory for common sense."

"TfL's view is that smartphones that transmit location information (based on GPS data) between vehicles and operators… are not taximeters within the meaning of the legislation." Transport for London

At issue is whether or not Uber is breaking a law that restricts the use of taximeters (used to determine the fare that a passenger pays based on distance traveled) to licensed black taxis. Taxi companies claim that the smartphone used by Uber drivers is effectively a taximeter, and that Uber is therefore breaking the law.

Trafalgar Square

TfL's ruling in favor of Uber came three weeks after several thousand European taxi drivers went on strike to protest Uber, with the largest strike beginning in London's Trafalgar Square. Taxi drivers have said that Uber has an unfair advantage because it doesn't have to follow the same regulations that they have to.

The strikes across Europe came as Uber (and rival ride-sharing service Lyft) face regulatory battles in U.S. states including California, Connecticut, Maryland, and Virginia. Pittsburgh on July 1 issued a cease-and-desist to both Uber and Lyft.

France's Senate passed a bill July 23 that would force drivers of ride-sharing services like Uber to return their dispatch center or garage in between fares. The National Assembly, the country's lower house, is expected to vote on the measure this fall. Uber said the law could "completely disrupt" its business model.

Germany's Monopoly Commission, which advises the government on competition policy, recommended July 9 to deregulate the country's taxi industry. Deregulation would allow Uber to expand in Germany without facing legal action. The company has said that it plans to launch in Cologne and Dusseldorf in a few weeks.

Uber has in the past argued that it is not a traditional transportation company, and therefore is not subject to regulations governing that industry. Rather, Uber says it's merely a platform provider that links private drivers (who do not work for Uber) with potential riders.

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