Uber and EU Law: Information Service or Transport Provider?

In the evolving landscape of digital platforms, a pivotal question has emerged: Should services like Uber be classified merely as “information society services” under Directive 2015/1535, or do they constitute transportation services subject to more stringent regulations? This distinction carries significant implications for how such platforms operate within the European Union.

Directive 2015/1535 defines an “information society service” as one that is:

1. Provided for remuneration,
2. At a distance,
3.  By electronic means,
4. At the individual request of a recipient.

Generally, EU Member States are restricted from imposing limitations on these services, such as requiring prior authorization or licensing, except in exceptional circumstances following a specific procedure that includes notifying the European Commission.

Conversely, transportation services are excluded from the scope of these directives and are subject to specialized regulations. Providers of such services may be required to obtain licenses, prior authorizations, and drivers might need special permits. Additionally, taxi services can be subject to requirements like visual identification, fixed pricing, taximeters, and mandatory contract obligations. These regulations are determined by national laws, as there is no unified EU legislation governing passenger transport.

The rise of digital platforms like Uber, which facilitate instant booking of passenger transport, has led to legal debates about their classification. Are they merely intermediaries providing information services, or are they full-fledged transportation providers? This distinction is crucial, as the latter would subject them to comprehensive transportation regulations, eliminating the defense of being solely information service providers.

The Uber Case: A Legal Examination

In December 2017, the Court of Justice of the European Union (CJEU) addressed this issue in the case of *Asociación Profesional Elite Taxi v. Uber Systems Spain SL* (Case C-434/15). The case centered on whether Uber’s service, which connects non-professional drivers using their own vehicles with passengers via a smartphone application, should be classified as an information society service or a transportation service.

The CJEU concluded that Uber’s service is more than a simple intermediation service. The Court noted that Uber:

1.  Provides a smartphone application indispensable for both drivers and passengers,
2. Exercises decisive influence over the conditions under which drivers provide their services,
3. Determines the maximum fare,
4. Exercises control over the quality of the vehicles, the drivers, and their conduct,

Based on these factors, the Court determined that Uber’s intermediation service is an integral part of an overall service whose main, primary,  component is a transport service. Consequently, Uber does not qualify as an information society service but rather as a service in the field of transport. This classification subjects Uber to national regulations governing transportation services, including potential requirements for authorization and licensing.

However, it is important not to generalize this ruling to all digital platforms. The classification of a platform depends on specific criteria. The CJEU has ruled differently in other cases, such as those involving AirBnB and Star Taxi, where the platforms were recognized as intermediaries rather than service providers. 

The CJEU has found that platforms that do not exercise control over pricing, driver behavior, and service conditions—such as AirBnB, which merely facilitates short-term rentals without dictating the terms—can qualify as information society services. Similarly, in the Star Taxi case, the court recognized the service as an intermediary because it did not impose operational conditions on drivers.

Implications for Digital Platforms

The CJEU’s ruling has significant implications for digital platforms operating in the transportation sector. Platforms that, like Uber, exert substantial control over the transportation service may be classified as transport service providers rather than mere intermediaries. This classification subjects them to the corresponding national regulations, which can vary across EU Member States. However, as demonstrated by cases like AirBnB and Star Taxi, platforms that merely facilitate connections between service providers and customers without controlling the service itself may still be classified as intermediaries under EU law.

In conclusion, the legal classification of digital platforms in the transportation sector hinges on the degree of control they exert over the service. Platforms that play an integral role in organizing and managing transportation services are likely to be classified as transport service providers, subjecting them to the corresponding national regulations. This legal landscape necessitates careful consideration by digital platforms to ensure compliance with applicable laws.