The Court of Justice of the European Union ruled Dec. 20 that Uber Technologies Inc. can be classified as a transport company, rather than a digital service, allowing regulators in EU member states to treat the platform as a taxi operator under national law.
Europe's top court concluded that Uber's "main component" is a transport service, namely "a service in the field of transport," placing it outside the scope of other intermediary electronic commerce such as hotel or flight booking platforms.
"The application provided by Uber is indispensable for both the drivers and the persons who wish to make an urban journey. [The Court] also points out that Uber exercises decisive influence over the conditions under which the drivers provide their service," the judicial body explained in a statement.
The judgment means that the company must comply with transportation rules and regulation in individual EU member states.
Responding to the verdict, an Uber spokesperson said the "ruling will not change things in most EU countries where we already operate under transportation law."
He also added that it is "appropriate" to regulate services such as Uber, so "we will continue the dialogue with cities across Europe. This is the approach we'll take to ensure everyone can get a reliable ride at the tap of a button."
The ruling is the result of a case that was brought against the ride-hailing firm in 2014 by a Barcelona-based taxi industry body, Asociación Profesional Elite Taxi, following complaints of unfair competition toward Elite Taxi's drivers.
Founded in 2009, the San Francisco-based company that currently operates in hundreds of cities worldwide, has been plagued by controversy over its management and services. The firm is currently appealing a decision by Transport for London not to renew Uber's private hire license.