Germany bans Uber's ridesharing service

A German court on Wednesday banned Uber from offering some of its ridesharing services nationwide and imposed stiff fines for any violations of the country’s local transport laws, adding to the San Francisco-based company's troubles in Europe.

Uber, which enables users to summon taxi-like services on their phones, is under fire from taxi operators and city officials across Europe who allege its system breaches licensing laws governing professional taxi drivers and informal ridesharing arrangements. 

Frankfurt state court spokesman Arne Hasse said the ruling banned the company’s UberPop service from offering rides with drivers who don't have taxi permits. The company said it would continue to operate other services, such as UberBLACK and UberTAXI, that were unaffected by the ruling. 

UberPOP links private, unlicensed drivers with passengers via their mobile phones. UberBLACK and UberTAXI use professional limousine drivers and licensed taxi cab drivers, respectively. 

The court’s decision stems from a suit brought against Uber by a German taxi association, and the case was heard in Frankfurt because it is one of several German cities where Uber launched operations.

Due to the same lawsuit, the same state court last summer issued an injunction banning Uber from operating in Germany — but the Frankfurt Regional Court lifted it a few weeks later, saying that while it considered Uber's practices illegal, an emergency injunction wasn't justified.

According to Wednesday's ruling by a three-judge panel, each violation of the order against Uber and its UberPOP online service is subject to a $264,825 fine.

Uber Germany General Manager and spokesman Fabien Nestmann said the company expected to appeal the court's decision.

“We regret today's decision by the Frankfurt regional court to prevent Uber from contributing to better and cheaper individual mobility,” Nestmann said outside the courtroom.

The company also said it was working on a new alternative ridesharing service designed to comply with the court's interpretations of existing German laws.

The case, brought by German taxi operator group Taxi Deutschland, is one of more than a dozen lawsuits that have been filed in countries across Europe in recent months against the U.S. company.

Dieter Schlenker, chairman of Taxi Deutschland, hailed the German court’s decision as a move that would protect professional taxi drivers from competition by unlicensed casual workers employed by Uber.

Attorneys representing Uber denied it was subject to rules governing taxi operators, claiming that the company merely acts as an exchange connecting drivers with clients.

Taxi industry groups and some taxi drivers complain that Uber unfairly bypasses local licensing and safety regulations by using the Internet to put drivers in touch with passengers. 

However, many licensed taxi drivers work with Uber as a way to supplement their existing incomes.

On Tuesday, French police raided Uber’s Paris offices at the request of the city prosecutor's office. 

The company called the French raids an "attempt at intimidation," adding that dozens of non-professional UberPop users had been fined since the start of the year. UberPop is technically illegal in France, but the company has appealed a $113,000 fine it received last year.

Earlier this month hundreds of taxi drivers from Belgium and France brought central Brussels to a virtual standstill with their vehicles as demonstrations protesting Uber caused traffic jams. About 100 French taxi drivers traveled to Brussels to take part in the protest.

Uber's American founder Travis Kalanick has said the system will create 50,000 new jobs in Europe this year, and will help take 400,000 cars off the road by encouraging drivers to use Uber cars instead of their own vehicles. 

Late last year, authorities in Thailand and Spain ordered the company to cease its ridesharing operations in those countries. The decisions were made after Uber was banned in the Indian capital of Delhi, following accusations that one of the online taxi service's drivers raped a passenger.  

Wire services