Description
The Court of Appeal in Germany ruled on 11 December 2015 that the business model of Uber Black violated competition law (Ruling 11.12.2015, (5 U 31/15). The judgement was taken to the Federal Supreme Court. Furthermore, on 18 May 2017 (ref. I ZR 3/16), the Federal Court of Justice stayed the proceedings and referred them to the European Court of Justice for a decision.
The facts:
A Berlin taxi operator sued Uber B.V. (operating Uber Black). The claimant argued that Uber Black's business model constituted unfair competition because it violated the German Passenger Transport Act (Personenbeförderungsgesetz - PBefG) – specifically, the rule requiring rental car bookings to be received at the operator's place of business.
The Berlin Court of Appeal (Kammergericht) dismissed Uber's appeal against the lower court's decision. It upheld the finding that the Uber Black service, as operated, was unlawful. (Note: An appeal to the Federal Court of Justice was permitted).
Motivation for Ruling: The court found that Uber Black directly connected passengers with rental car drivers via its app, bypassing the legal requirement (§49 PBefG) for such bookings to be received first at the licensed rental car company's registered office. This violation of transport regulations gave Uber an unfair competitive advantage over compliant taxi services.
On the 18 May 2017 the Federal Court of Justice (Bundesgerichtshof - BGH) issued an order ('Beschluss') confirming the appeal proceedings and referring questions to the Court of Justice of the European Union (CJEU) for a preliminary ruling.
The BGH needed clarification from the CJEU on a crucial point of EU law: Should Uber's service be classified as a "transport service" under the Treaty on the Functioning of the European Union (TFEU Art. 58)? This was vital because transport services are largely exempt from the EU's general "freedom to provide services" (TFEU Art. 56), which Uber might have invoked. Determining the correct classification under EU law was necessary for the BGH to decide the appeal correctly. This referral was later withdrawn by the BGH after the CJEU ruled on a similar Spanish case involving Uber.
- Keywords
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sector aspects, competition, lobbying
- Actors
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Other,
Court
- Sector
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Transportation and storage
Sources