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France had a right to charge Uber execs over running illegal service, top EU court says

  • The European Union's top court, the European Court of Justice (ECJ) backed French authorities' criminal charges against Uber.
  • Uber tried to appeal the case on an EU law technicality, which the ECJ didn't agree with.
  • Uber stopped UberPop in France in 2015 and said in a statement that it only works with "professional licensed drivers" in the country.

France has the right to bring criminal charges against Uber for running an illegal taxi service, the European Union's (EU's) top court said on Tuesday.

Criminal law proceedings were brought against Uber in France in 2016 when a court in Lille said that the U.S. company was guilty of running an illegal transportation service. The court was referring to UberPop which puts passengers in touch with non-professional and unlicensed drivers.

Uber has argued, however, that the proceedings were based on a law which concerns an "information society service" or more broadly an internet company, and therefore required that the European Commission, the EU executive, should have been notified.

Uber app
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But the European Court of Justice (ECJ), the EU's top court, said that this isn't necessarily the case.

"Member states may prohibit and punish the illegal exercise of a transport activity such as UberPop without having to notify the Commission of the draft law in advance," Maciej Szpunar, advocate general at the ECJ, said in a press release on Thursday.

The opinion given by Szpunar is non-binding but the final decision is usually followed by the ECJ's judges.

Szpunar referenced another opinion by the ECJ in May, in which it said that Uber is actually a transportation service and not an "information society service". In the May opinion, the advocate general said that Uber may be required to seek licenses for its service in every country in which it operates. Since Uber is not merely an internet service, the Commission does not need to be notified in advance about any law to criminally punish the company, Szpunar said.

Uber has always maintained that it is not a transportation company and merely connects drivers to riders.

The only time a member state would need to notify the Commission of a draft law to criminally punish a service like UberPop, is if it is looking to regulate that particular service specifically. In this case, the ECJ says that France's punishment of Uber only affected the service in "an incidental manner" and was not aimed at "explicit" regulation of UberPop.

"We have seen today's statement and await the final ruling later this year. This case relates to a French law from 2014 and affects peer-to-peer services which we stopped in 2015. Uber today works only with professional licensed drivers in France," said an Uber spokesperson.

Uber shut down its UberPop service in France following riots in the country from taxi drivers who overturned cars and burned tyres.

Also in France last year in a separate case, Pierre-Dimitri Gore-Coty, who is now Uber's EMEA head, and Thibaud Simphal, who was at the time the head of France, were both fined in Paris for running an illegal transportation service, while the company was ordered to pay 800,000 euros ($908,200). This case is still under appeal and is scheduled for late September with an outcome expected by the end of the year.

It's the latest blow for the embattled U.S. start-up which has faced sexual harassment claims, used software to evade law enforcement, and seen former CEO Travis Kalanick resign, leaving the company without any leadership.

On top of that, Europe has been tough for Uber which has clashed with regulators on a number of occasions. The company recently pulled out of Denmark, and is banned in some cities across the region. UberPop has also been banned in some countries such as Germany and Sweden.