https://www.ft.com/content/61743db2-795e-11e8-8e67-1e1a0846c475Uber wins back London licenceApp to continue operating in largest European market ahead of IPOAliya Ram and
Shannon BondUber has won back its London licence in a major court victory that will allow the app to continue operating in its largest European market ahead of an initial public offering next year.
British judge Emma Arbuthnot granted Uber a 15-month licence on Tuesday with the caveat that it follow a set of rules agreed with London’s transport authority.
“Inevitably such a young business has suffered a number of growing pains that hasn’t been helped by the gung-ho approach [of managers],” she said. “I have given particular weight to the conditions agreed between the parties. Taking into account the new governance arrangements I find that while Uber was not a fit and proper person when the decision was taken and the months after it is now a fit and proper person.”
Uber had its licence revoked by TfL last September after it was accused of being “not a fit and proper” operator because of public safety concerns and its attitude to regulators.
The decision follows a high-stakes court battle in which Uber argued it had “grown up” following the ousting of founder Travis Kalanick as chief executive at the end of last summer. Thomas de la Mare, a lawyer representing Uber, admitted that the company “did some things in hindsight that are pretty stupid to be frank.”
Uber has agreed to a slew of new conditions with TfL in addition to a series of changes made since the start of the year, including proactive reporting of violent incidents to the police. The app has agreed to be audited after six months and said it will not employ senior managers who were aware of the Greyball software used to avoid regulatory scrutiny.
Tom Elvidge, promoted to be the ride-hailing app’s general manager for the UK and Ireland in the wake of its licence ban, argued that Uber had made a “fundamental change” to its management style and overhauled its UK leadership.
Mr Elvidge’s predecessor, Jo Bertram, who was singled out for criticism by TfL, left the company last October. She has since joined O2 the UK arm of Telefónica, the Spanish telecoms company.
Uber’s London license case, which lasted two days, was watched closely for signs that a regulatory backlash has eased as the app attempts to shake off its reputation for a bullying culture under its new chief executive, Dara Khosrowshahi, who replaced Mr Kalanick in August.
The case had come to symbolise the clash between European regulators and disruptive US technology companies that have been accused of riding roughshod over traditional industry categories and regulations.
Within weeks of his appointment, Mr Khosrowshahi flew to the UK to meet TfL commissioner Mike Brown. After initially saying he was “disappointed” by London’s decision, Mr Khosrowshahi has apologised for past mistakes.
Helen Chapman, licensing director for TfL, said in a witness statement that “it is difficult for TfL to assess Uber London Limited’s changes to its corporate culture and approach, because they will take time to become embedded in the business.”
London is Uber’s biggest European market with over 3.6m users and around 45,000 drivers. As Uber has pulled back from money-losing markets including south-east Asia, its biggest backer, SoftBank, has urged the company to focus on core markets including the US and Europe.
Uber is currently banned, restricted or forced to withdraw certain services such as its peer-to-peer technology UberPOP from countries including Spain, Denmark, Germany, Italy, Finland, the Northern Territory of Australia, Japan, Hungary and Bulgaria.
The app also faces tougher government oversight in the EU following a decision from the European Court of Justice last November that it should be regulated like a traditional taxi company instead of a technology group. It is also under government investigation over its business practices in the US.
Tuesday’s decision marks a significant victory for Mr Khosrowshahi, who has made London a front line in his attempt to clean up the company’s image and prove to regulators it can operate responsibly. The company is also planning to relaunch in Finland after new regulations come into effect next month.
The legal battles are not over for Uber in the UK, however. In November the app lost a key tribunal ruling after it was told it must treat drivers as “workers” entitled to the minimum wage and holiday pay. It is also appealing against that decision, with the next hearing scheduled for October.
