In what could start a series of similar moves in other jurisdictions, the Transport for London (TFL) authority on Sept. 22 turned down Uber's application for an extension to its operating license in the U.K. capital.
The ride-hailing service's London-area permit expires Sept. 30. The reason for the denial, TFL said, was that Uber has shown "a lack of corporate responsibility."
Uber said it will appeal the decision and can continue doing business in the city while the appeal is in progress.
The San Francisco-based company was deemed "not fit and proper" by the TFL to be a private hire operator license holder due to several issues which the TFL believes disqualify it from being allowed to operate in the London metropolitan area. These include:
- Uber's mishandling of acquiring medical certificates and reporting criminal offenses;
- its practices related to the usage of controversial officer-avoiding software Greyball; and
- the authority citing as questionable the company's methods for obtaining Enhanced Disclosure and Barring Service (DBS) checks.
Officer-Avoiding Application Cited as Problematic
Greyball is a software application used to identify and deny service to certain riders, including riders who Uber suspects of violating its terms of service. As early as 2014, Uber had used Greyball to evade local government authorities in the U.S., Australia, South Korea and China.
Following the publication earlier this year of a New York Times story about the application, Uber admitted that it had used it to thwart government regulators and promised to stop using the tool for that purpose.
Uber said it is prepared to exhaust all legal options before it accepts the TFL's decision, which it described as originating from political pressure exerted by "a small number of people" who have labeled it as being anti-consumerist because it limits the choice of transportation means in the city.
According to the publication Androidheadlines.com, Uber obtained its first private hire operator license in London in 2012 and paid only 3,000 pounds for it before gaining a four-month extension last May while the TFL was still drafting a new licensing system.
Serves About 3.5 Million Riders in London
Uber said it employs 40,000 drivers in London and serves about 3.5 million riders in the city. Uber has 21 days from Sept. 22 to file an official appeal to the decision.
Local taxi drivers have been organizing protests against Uber for more than five years.
Dan Ridsdale, analyst at Edison Investment Research, told eWEEK in a media advisory that "the decision will be unpopular with many Londoners, but it was made because Uber has played too fast and too loose in a number of areas, particularly with the use of Greyball, which was possibly the swing factor.
"We also believe that the ruling is symptomatic of the increasing concern of governments and government bodies over the ever growing power of 'big tech' companies and the perception that they are writing their own rule books to gain a competitive advantage."