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EU court overturns Barcelona’s limits on ride-hailing groups

EU court overturns Barcelona’s limits on ride-hailing groups

The EU’s top court has lifted Barcelona’s restrictions on driving licenses in a ruling that is a victory for app-based taxi groups such as Uber and Cabify.

Barcelona’s city government – one of the most tourist-unfriendly in Europe – ruled in 2018 that for every 30 traditional taxi licenses, only one license can be granted to a vehicle affiliated with Spain’s Cabify or Uber from the US.

However, the European Court of Justice said on Thursday that the license ratio was “contrary to European law”. It notes that a total of 15 private hire companies argued that the regulation had “the sole aim of protecting the interests of the taxi industry”.

The ECJ’s ruling could have far-reaching effects across Europe as it says that ensuring the “economic viability” of taxi services “cannot constitute an overriding reason in the general interest” for restricting private fleets. Italy and Greece have justified similar restrictions on apps like Uber as a means of protecting traditional taxi companies.

A subsidiary of Cabify launched legal action against Barcelona, ​​which was led by left-wing mayor Ada Colau, who has won international praise for trying to reduce car use but has been criticized at home for perceived mismanagement and business caution.

Colau was defeated in the mayoral election at the end of May. Her pro-business rival Xavier Trias secured the largest representation in the city council, but with no candidate winning an absolute majority, negotiations to form a government continue.

The ECJ said that Barcelona “imposed restrictions on the exercise of freedom of establishment” by requiring special licenses for Barcelona in addition to national ones, and then added a license ratio that was skewed in favor of traditional taxis.

The court rejected the claim that the measures would protect the environment or contribute to “sound management of transport, traffic and public space”.

Around the world, Uber and its rivals have long been seen as an existential threat to traditional taxi drivers, who often have to pay hefty fees to buy their licenses. In recent years, Uber has been forced to embrace traditional taxis, bringing them into its app to gain a foothold in European markets like Barcelona that have imposed restrictions on private hire vehicles.

About 4,000 taxis are now available for hire through the Uber app in Spain. The company said earlier this week that taxis now account for about 10 percent of all trips by its customers in Europe, the Middle East and Africa, double what it was a year ago.

Two Spanish trade groups for vehicle transport companies, Feneval and Unauto VTC, welcomed the ECJ’s decision and said it “called into question many of the restrictions” on members introduced in recent years by the regional governments of Catalonia, Valencia, Aragon and the Balearic Islands. .

In Catalonia, the regional government, based in Barcelona, ​​has imposed rules requiring passengers to wait at least 15 minutes between ordering a car and its arrival. They also prescribe a minimum vehicle size that is larger than a typical car to drive.

Asked about the ECJ ruling, Janet Sanz, one of Barcelona’s deputy mayors, did not comment on the court’s rejection of the city’s permit application. Cabify declined to comment.

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