Uber suffers a major blow as it loses its London license

Uber suffers a major blow as it loses its London license

Why it matters to you

If you’re in London and ride regularly with Uber, you may soon have to make alternative plans.

In one of the biggest blows to Uber’s business since its founding eight years ago, the ridesharing company has had its application for a new operating license in London rejected.

Regulator Transport for London (TfL) told Uber on Friday that it is “not fit and proper to hold a private hire operator license” and therefore will not grant a replacement when the current one expires at the end of this month. Uber has 21 days to appeal the ruling and can continue serving riders during that time.

Uber says it currently has more than 3.5 million Londoners using its service, and around 40,000 drivers who make a living from it.

In a statement explaining its decision, TfL said its regulation of taxi and private hire businesses aimed to ensure the safety of passengers. But it said Uber’s approach and conduct demonstrated “a lack of corporate responsibility in relation to a number of issues which have potential public safety and security implications.”

These include:

  • Its approach to reporting serious criminal offences
  • Its approach to how medical certificates are obtained
  • Its approach to how Enhanced Disclosure and Barring Service (DBS) checks are obtained
  • Its approach to explaining the use of Grayball in London, software that could be used to block regulatory bodies from gaining full access to the app and prevent officials from undertaking regulatory or law enforcement duties

Uber’s London operation came under fire in August, 2017 when it was accused of failing to report directly to police a string of serious crimes allegedly committed by its drivers.

Uber: Riders and drivers will be “astounded”

Responding to TfL’s decision, Tom Elvidge, general manager of Uber London, said Uber’s riders and drivers in the capital city would be “astounded by this decision,” one which the company will appeal.

He said the decision to ban the app showed that TfL and the London mayor, Sadiq Khan, had “caved in to a small number of people who want to restrict consumer choice.”

“To defend the livelihoods of all those drivers, and the consumer choice of millions of Londoners who use our app, we intend to immediately challenge this in the courts.”

Elvidge insisted that Uber drivers are licensed by TfL “and have been through the same enhanced DBS background checks as black-cab drivers. Our pioneering technology has gone further to enhance safety with every trip tracked and recorded by GPS. We have always followed TfL rules on reporting serious incidents and have a dedicated team who work closely with the Metropolitan Police. As we have already told TfL, an independent review has found that ‘grayball’ has never been used or considered in the U.K. for the purposes cited by TfL.”

He finished by claiming the ban would “show the world that, far from being open, London is closed to innovative companies who bring choice to consumers.”

London’s mayor comments

London mayor Sadiq Khan said all businesses operating in London “must play by the rules and adhere to the high standards we expect, particularly when it comes to the safety of customers. Providing an innovative service must not be at the expense of customer safety and security.”

Khan added that it would be “wrong if TfL continued to license Uber if there is any way that this could pose a threat to Londoners’ safety and security.”

Signs that Uber’s London operation was coming under increased scrutiny came in May when its license was renewed for just four months instead of the usual five years.

It’s too early to say how Uber riders and drivers in London will react to Friday’s decision, though when TfL proposed limiting Uber’s operations with strict private hire rules in 2015, more than 200,000 people signed a petition in protest. Most of the proposals were subsequently dropped.

Uber has been having a tough time of it lately. Facing mounting criticism over how it conducts its business, it was also rocked by allegations in February of sexual harassment in the workplace. More recently, Uber founder Travis Kalanick was forced to resign by investors concerned about the direction in which the company was heading, and it’s also currently embroiled in a legal battle with Google/Alphabet.

Published at Fri, 22 Sep 2017 13:20:11 +0000

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