Ride-hailing firm Uber was dealt a severe blow on Wednesday after the EU Court of Justice (CJEU) ruled that the company should be treated more like a traditional taxi firm.
It means the US start-up is set to be subject to the obligations applied to taxi firms, ranging from licensing to insurance, changing the way it currently operates in the EU.
Uber has long argued that it is just a digital app that acts as an intermediary link between drivers and customers who need a taxi.
However, the CJEU has completely overturned Uber´s argument.
“The Court takes the view, first of all, that the service provided by Uber is more than an intermediation service consisting of connecting, by means of a smartphone application, a nonprofessional driver using his or her own vehicle with a person who wishes to make an urban journey,” said the CJEU in a statement on Wednesday.
“The Court finds that that intermediation service must be regarded as forming an integral part of an overall service whose main component is a transport service and, accordingly, must be classified not as ‘an information society service’ but as ‘a service in the field of transport” said the CJEU.
The case originated from a complaint of unfair competition from a Barcelona taxi association against Uber’s unlicensed ride-hailing service UberPOP.
UberPOP used inexperienced drivers and the service has since been suspended in most European cities.
In September, Transport for London ruled that Uber was unfit to run a taxi service and refused to renew its license.