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25.11.2019 Business & Finance

Uber Loses Licence To Operate In London After Safety Failure

By News Desk
Uber Loses Licence To Operate In London After Safety Failure
NOV 25, 2019 BUSINESS & FINANCE

Uber will not be granted a new licence to operate in London after repeated safety failures, according to the Transport for London (TfL).

The regulator said the taxi app was not "fit and proper" as a licence holder, despite having made a number of positive changes to its operations.

Uber initially lost its licence in 2017 but was granted two extensions, the most recent of which expired on Sunday.

The firm will appeal and can continue to operate during that process.

About 45,000 drivers work for Uber in London, which is one of its top five markets globally.

Explaining its decision not to renew, TfL said it had identified a "pattern of failures" that placed passenger safety and security at risk.

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These included a change to Uber's systems which allowed unauthorised drivers to upload their photos to other Uber driver accounts.

It meant at least 14,000 fraudulent trips were carried out in London in late 2018 and early 2019, TfL said.

The regulator also found dismissed or suspended drivers had been able to create Uber accounts and carry passengers, "compromising passenger safety and security".

Helen Chapman, Director of Licensing, Regulation and Charging at TfL, said: "While we recognise Uber has made improvements, it is unacceptable that Uber has allowed passengers to get into minicabs with drivers who are potentially unlicensed and uninsured."

London Mayor Sadiq Khan said: "I know this decision may be unpopular with Uber users, but their safety is the paramount concern. Regulations are there to keep Londoners safe." 'High bar'

Uber said the decision was "extraordinary and wrong". It said it had audited every driver in London over the last two months and further strengthened its processes.

Boss Dara Khosrowshahi tweeted: "We understand we're held to a high bar, as we should be. But this TfL decision is just wrong. Over the last 2 years we have fundamentally changed how we operate in London."

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If Uber's appeal is unsuccessful some think it would leave a huge gap in the London ride-hailing market.

However, Fiona Cincotta, market analyst at City Index, told BBC Radio 4's Today programme: "Here in London, there would be competition that would fill that void quite quickly."

According to Uber , 24% of its sales come from just five cities, including London. The others are Los Angeles, New York City, San Francisco and São Paulo in Brazil.

If Uber did leave London, it would not be alone

- Uber pulled out of Denmark in 2017 because of new taxi laws that required drivers to have fare meters and seat sensors.

- Bulgaria and Hungary have also banned it.

- In May, Uber pulled its UberXL service in Turkey, without saying why.

TfL can offer licences of up to five years, but it has been more stringent of late.

In July, Indian ride-hailing company Ola got a 15-month agreement for its entry into the London market, while ViaVan got a three-year licence renewal.

In September 2017, TfL declined to renew Uber's licence on similar safety grounds, citing Uber's approach to carrying out background checks on drivers and reporting serious criminal offences.

Uber's use of secret software, called "Greyball", which could be used to block regulators from monitoring the app, was another factor, although Uber said it had never been used in the UK.

---BBC

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