Uber's International Expansion: Frankfurt (Germany) Court Lifts Injunction

In our May 2014 Newsletter, we wrote about the Berlin Taxi Association successfully suing Uber, the private car company that created a GPS-enabled app for customer to summon rides, in the Berlin court system.

Now the district court in Frankfurt overturned a nationwide ban against Uber's car-sharing service, one of the most severe legal restrictions imposed on Uber anywhere. The temporary ban had been in effect since September 2 before a hearing could be held. After the hearing the court decided to lift the injunction because, since the plaintiff, Taxi Deutschland, had waited too long to file the case, there are no sufficient reasons for an accelerated decision.

In Germany, Uber started its low-cost service, UberPop, in April. The court did not make a judgment on whether Uber's services were now legal in Germany. Taxi Deutschland argues that Uber does not provide the necessary licenses and insurance for its drivers and therefore believes that Uber is acting unlawfully. In addition taxi companies emphasize the perils of everyday road traffic that require certain regulations to be met by drivers and taxis.

Uber's drivers are classified independent contractors, not employees and therefore Uber claims to just provide digital dispatch or ride-sharing services.

Opposition to Uber exist from taxi associations across Europe because their Uber competitors can offer cheaper prices as they are not saddled with the same operating costs, like taxi insurance and local licenses. Charges center on the question whether Uber's business was anti-competitive.

There are open legal cases against Uber in Berlin and Hamburg as well. But the courts in these cities did not impose preliminary injunctions like in Frankfurt. Until now there is still no final ruling over whether Uber complies with local laws.

While taxi associations believe that Uber is not complying with local licensing rules, Uber claims it is pushing for more innovation, as well as use of social media in business and the taxi drivers are just resisting increasing competition. It is old fashioned ways of taxi service (and regulations) versus innovation.

Meanwhile the district court in Frankfurt on September 9 prohibited another driver (the second in about two weeks) to offer rides via "UberPop" as long as his payment exceeds the operation costs of the ride.

In Charlotte, cab companies also say Uber, and Lyft, should face same regulations as regular taxi companies. In Charleston, S.C. the police announced to stop Uber drivers who do not abide by the same requirements as taxi drivers.

Charlotte's City Council debates about passing a new ordinance that would extend some cab regulations to Uber and Lyft drivers while loosening some restrictions on cabs. Meanwhile state lawmakers in Raleigh are seeking a statewide solution.