The Court of Justice of the EU: to the member States the regulation of Uber as a transport service

With the ruling n. C-434/15 of December 20 2017 the Court of Justice of the EU have delegated to the member States the task of regulating, even prohibiting its supply, the electronic platform managed by Uber which, as is well known, provides, through a smartphone application, a paid service for contacting non-professional drivers, without licenses and administrative authorizations, who use  their vehicle for offering urban mobility service.

The dispute arises from the appeal proposed by Elite Taxi – a professional association of taxi drivers in Barcellona – ahead the Juzgado de lo Mercantil n. 3 de Barcelona – to ascertain the violation by Uber Systems Spains of the internal regulation corncerning deceptive practices and acts of unfair competition, given that neither Uber Systems Spains nor the non-professional drivers of the vehicles concerned, had the licenses and permits required from the taxi services regulation in effect in Barcellona. The spanish Court, considering as preliminary for the judicial decision the question “if the services provided by Uber had to be qualified as transport services, or as information society services or as a combination of both types of services”, had proposed the aforementioned question  – ex art. 267 TFEU – ahead the Court of Justice of the EU; from the judicial decision of supranational Court would descended the possibility of imposing to Uber the obligation to obtain a prior administrative authorization.

In particular, the judge a quo had expressed the belief that if the Uber service fell within the scope of Directive 2006/123 – on services in the internal market – or within the Directive 98/34 – on electronic commerce – Uber’s practices could not have been considered unfairs.

The Court of Justice of the EU, called to dispel the exposed hermeneutical and applicative uncertainties, after outlining the service provided by Uber, has established that it is to be considered part of a more complex service whose main element is represented by the transport service which, as such, does not respond to the qualification of “information society service” – pursuant to Article 1, paragraph 2 Directive 98/34 – but to that of “transport sector service” – textually excluded by the Article 2, paragraph 2 from the scope of Directive 2006/123.

From these premises, the Court of Justice of the EU has inferred the non-applicability, in the case, of Article 56 TFEU related to the free performance of services, finding instead application the Article 58, paragraph 1 TFEU according to which “the free movement of transport services is governed by the provisions of the title relating to transport”; in the trasport sector, the application  of principles of free provision of services would had to be achieve through the implementation of the common transport policy.

However, given that, currently, the Parliament and the European Council have not yet proceeded with the adoption of common rules, the Court of Justice of the EU concluded by requiring the member States to regulate the conditions of performance of service in compliance with the rules provided by the Treaty on the Functioning of the European Union.

The ruling n. C-434/15 has strongly striked the expectations of Uber’s economic growth as well as of many startup of sharing economy, that, having worked in an unregulated sector so far, they have been able to reduce costs offering a service at competitive prices.

As for Italy, is deeply desiderable the intervention of the Legislator, also considered the inadequacy of the current transport regulation law, now dating back to 1992.