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Technology

Uber loses its licence to operate in London

By Chris Baraniuk

22 September 2017

Using uber on a smartphone

Don't count on it

credit : Toby Melville/Reuters

Popular ride-sharing firm Uber has had its licence to operate in London revoked in a surprise move by the city鈥檚 regulator. Transport for London (TfL)聽聽that Uber was 鈥渘ot fit and proper to hold a private hire operator licence鈥.

Tom Elvidge, Uber鈥檚 general manager in London, says the firm鈥檚 users 鈥 and its 40,000 drivers 鈥 will be 鈥渁stounded鈥 by TfL鈥檚 decision.

鈥淚f this decision stands, it will put more than 40,000 licensed drivers out of work and deprive Londoners of a convenient and affordable form of transport,鈥 he says.

There were multiple reasons for the decision. TfL聽cited the company鈥檚 approach to reporting criminal offences. In August, a senior officer within London鈥檚 Metropolitan Police Service聽聽that her driver had sexually assaulted her. TfL said it was also concerned about how Uber obtained medical certificates and criminal records checks for drivers. The straw that broke the camel’s back may have been the company’s聽鈥淕reyball鈥 software 鈥 an internal application that Uber may have used to block regulators鈥 oversight of the Uber app.聽鈥淭his shows that Uber can鈥檛 have its own way everywhere in the world where it tries to launch,鈥 says Chris Jones, chief analyst with research firm Canalys.

The firm’s licence will expire on 30 September, but this does not mean that Uber’s 3.5 million London users will immediately need to reconsider their transport options: Uber can continue to operate during the 21 days it has to appeal. 鈥淭hey do have a lot of people using them so it will be a shock,” says Jones.

Competitors smell blood

He also says this will be a warning for other companies. In the immediate aftermath, however,聽other聽companies seem to see more聽opportunity than warning. MyTaxi has notified select customers to promote its 50 percent reduced weekend fares, commenting that this will be cheaper than Uber, “who have just been found not fit and proper”.

Other services already competing with Uber in the British capital may fare well. Uber offers a food delivery service and today JustEat, a rival, has seen a聽.

However, not every potential competitor will benefit. Jones says he doesn鈥檛 think the news will make US rival Lyft 鈥 which offers a similar app and ride-sharing service 鈥 any more likely to enter the UK market. 鈥淚t would be an obvious place to launch after the US but they鈥檝e witnessed what Uber has gone through and the troubles it鈥檚 faced in London,鈥 he explains.

Elvidge adds that Uber drivers have been through the same record checks as black cab drivers and said the firm has 鈥渁 dedicated team鈥 that works closely with the Met Police. He also cites an independent review which had cleared Uber of using or considering to use Greyball in the UK.

Steve McNamara is general secretary of the Licensed Taxi Drivers鈥 Association, which represents drivers at firms competing with Uber. He says TfL had made the right call, adding that Uber, which he describes as an 鈥渋mmoral company鈥, has no place on London鈥檚 streets.

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