The app-based cab service Uber yesterday vowed to ignore a German ban imposed by a court in Frankfurt as traditional taxi firms stepped up their campaign against the San Francisco-based upstart.
Uber said that it would fight the injunction despite the threat of a €250,000 fine every time it flouts the ban, which was applied pending a full hearing of a case brought by Taxi Deutschland, a German group that offers an app for ordering licensed cabs.
Court battles in Berlin and Hamburg had led to traditional taxi groups winning temporary bans. These were successfully challenged by Uber last month in an increasingly bitter fight over the lucrative German market.
Uber enables users to summon taxi-like services on their smartphones. It has faced a series of regulatory battles, though this has not stopped it from expanding rapidly into 150 cities.
“Uber will continue its operations and will offer UberPop ride-sharing services via its app throughout Germany,” the company said.
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“Germany is one of the fastest-growing markets for Uber in Europe. We will continue to operate in Germany and will appeal the recent lawsuit filed by Taxi Deutschland in Frankfurt. We believe innovation and competition is good for everyone, riders and drivers, everyone wins. You cannot put the brakes on progress.”
Uber is widely regarded in Germany as a brash American challenger to the established order, much in the same way that Amazon has shaken up the retail industry.
In its ruling, Frankfurt Regional Court said that the company could no longer offer its Uber and UberPop phone apps to connect drivers with passengers, stating that Uber’s network of drivers lacked the necessary commercial licences.
German law allows drivers to pick up passengers without a commercial licence only if the driver charges no more than the operating cost of the trip. Uber takes a cut of any charges, making it liable in the eyes of the court.
Legal experts said that the ruling applied nationwide unless Uber appealed and subsequent decisions limited the scope of the ban.
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Founded in 2009 and valued at $18.2 billion (£11 billion) after its latest funding round in June, Uber Technologies argues that it is an electronic marketplace which connects drivers with customers, not a transportation service itself.
Drivers must carry a valid driving licence, have necessary local permits and undergo background checks, Uber said.
The case was brought by Taxi Deutschland, a consortium of taxi companies operating in large cities across Germany. Taxi Deutschland offers its own taxi-hire apps for smartphones.
BZP, the German taxi federation, welcomed the court ruling, insisting that the legal permits required under German law “are not an end in themselves, but in order to safeguard quality and customer protection”.
It added: “We are not frightened by new market players. But competition can only function if the same legal conditions apply to everyone, including new market players. Internet services do not operate outside the law.”
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Even in its home city of San Francisco, Uber had to overcome legal and regulatory hurdles from city authorities concerned that its services sidestepped rules governing commercial transport and from taxi companies hoping to keep competition out.
Taxi drivers across Europe caused chaos in June by going on strike to protest against the service, but it has continued to grow in popularity.
Uber said last week that it was experiencing huge demand for its services in German cities including Berlin, Frankfurt and Hamburg and that it planned to expand into Cologne and Stuttgart this year.