- London’s regulator did not renew Uber’s licence, finding failings that put passenger safety at risk.
- The company can keep operating while it appeals, within a period of twenty-one days.
- The case shows that platforms are subject to licences, controls and responsibilities like any transport operator.
On 25 November 2019, Transport for London, the body that regulates transport in the British capital, announced that it would not renew Uber’s licence to operate in the city. Its argument was that the company had shown a pattern of failings that put passenger safety at risk. One of the problems cited was a change in its identification systems that allowed unauthorised people to upload their photos to the accounts of legitimate drivers.
Uber has twenty-one days to appeal and, while that process lasts, can continue providing the service. The company announced it would appeal and called the decision “extraordinary and wrong”. It is not the first time: the regulator had already refused to renew the licence in September 2017, and a magistrate overturned that decision in June 2018 after an appeal by the company. The regulator had shown in the past its willingness to limit or withdraw licences from platforms that fail to comply, so the notice was not entirely unexpected.
A platform subject to licence
In London, as in many cities, ride-hailing apps operate as private-hire vehicle businesses, an activity that requires a licence renewable periodically, with requirements on drivers’ identity, insurance, vehicle condition and complaint handling. The licence is not a formality: it is the condition for operating, and the regulator may attach conditions to it or withdraw it.
What matters in the case is not just the decision, but what it shows about the model. A platform that connects independent drivers with passengers remains responsible for verifying who provides the service. When the identification system fails, there is not only a risk to the user: there is a regulatory and reputational risk for the company. The responsibility to verify drivers is central to the business model, because users’ trust depends on knowing who is behind the wheel.
What happens in Spain
Spain has had its own regulatory dispute between taxis and private-hire vehicles. The government approved in 2018 a royal decree-law that reinforced the powers of the regions and the municipalities to regulate the sector, and in Catalonia rules have been issued requiring, for example, a minimum advance booking time. Companies have reacted in different ways, from adapting to reducing their activity in certain cities.
The lesson for companies in any sector is that the digital model does not exempt them from the rules of the traditional sector. Whoever intermediates transport, accommodation, delivery or payment services answers, to a greater or lesser degree, for the quality and safety of the final service, and for the protection of its users’ data. There is also a continuing debate on whether those working for platforms are employees or self-employed, a question that in Spain some high courts have resolved differently in delivery cases.
What to review
Companies operating through platforms or apps should review what licences or authorisations their activity requires in each territory, how they verify the identity and background of those providing the service and what happens if a control fails. It is advisable to document these procedures and audit them periodically.
For those who hire or use platform services, it is useful to know the framework: what responsibilities the company assumes, what insurance covers the user and what complaint routes exist. If your business depends on these platforms for its activity, it is wise to have alternatives in case a licence is put in doubt.
A licence is a conditional permit, not a right acquired for ever.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
