Uber loses London licence

Transport for London (TfL) has published its decision not to renew Uber's hire vehicle operator licence on the basis that Uber is not fit and proper to hold a licence.

How did we get here? 

London's private hire market is regulated under the Private Hire Vehicles (London) Act 1998. TfL is the licensing authority and it is a criminal offence to accept bookings without a licence from TfL.

Uber was originally granted a five year private hire vehicle (PHV) licence in 2012. When Uber came to renew that licence in 2017 it was granted a short licence whilst TfL investigated various concerns. The outcome of that investigation was that Uber was not "fit and proper" to hold a PHV licence. TfL's decision was based, amongst other things, on Uber's approach to reporting criminal offences, obtaining medical certificates and conducting background checks on its drivers.

Uber appealed TfL's decision and, on 26 June 2018, the Chief Magistrate, Emma Arbuthnot, found that whilst Uber was not a fit and proper person to hold the licence at the time of TfL's decision it had since provided evidence that the deficiencies identified by TfL had been remedied. Uber was granted a 15-month licence to enable TfL to test out the new arrangements and to enable Uber to demonstrate its adherence to its licence conditions. Uber was also required to comply with a number of further conditions including a requirement to maintain arrangements with the Metropolitan Police for the reporting of passenger complaints that were possibly criminal in nature.

In July 2019, Uber was convicted of contravening its licence by allowing drivers to pick up passengers without the required insurance.

The 15-month licence expired in September 2019 and TfL granted Uber only a two month extension stating that it needed to see further evidence of Uber's commitment to ensure passenger safety. TfL also imposed further conditions on ride sharing, appropriate insurance and driver document checks.

TfL's decision today

TfL identified a pattern of failures including breaches that it concluded risked passengers safety leading TfL to conclude that Uber "is not fit and proper at this time".

TfL was particularly concerned by a change to Uber's systems which enabled unauthorised drivers to upload their photos to other Uber driver accounts and pick up passengers as though they were the booked driver. This occurred on at least 14,000 occasions. All of these journeys were uninsured and some took place with unlicensed drivers.

What happens next?

Uber has 21 days to lodge an appeal. It will be permitted to operate until such time as the appeal is heard in the magistrates' court. Uber may seek to implement further changes to its operations to demonstrate to the court that it is fit and proper by the time of the appeal.

The court has power to reverse or vary TfL's decision, it could for example, once again, grant a licence for a period shorter than the usual five years. The hearing will look at the matter completely afresh rather than by reviewing TfL's decision. The court will examine the evidence that was considered by TfL, together with any new information from Uber and TfL's policies and make its own decision on whether a licence is granted.

TfL noted a number of positive changes and improvements to Uber's culture, leadership and systems and conceded that Uber had interacted with TfL in a transparent and productive manner. Notwithstanding the issues raised by TfL, Uber seems to have dramatically improved its approach to public safety and its regulator since its licence was refused in 2017. TfL's statement that Uber "is not fit and proper at this time" seems to anticipate a successful appeal. Uber may therefore approach the magistrates court with some confidence that, with a period to further change its business operations, it will be granted a new licence.

In the circumstances it is perhaps surprising that TfL felt that it was necessary to refuse a licence when it could itself have issued a licence for a limited period and imposed conditions that would have compelled Uber to take further steps to ensure public safety. The decision to refuse a licence altogether will cause distress to Uber's drivers who, once again, will endure a period of uncertainty as to whether they will be permitted to earn a living and will feed the suspicion in some quarters that TfL is more concerned with protecting the interests of black-cab drivers than in the cause of public safety.