Uber suffers legal setbacks in France and Germany

In France, a judge slapped Uber with a €800,000 (£625,500) fine for running the "illegal” UberPop service using unlicensed drivers. It also fined two of the company’s senior executives a combined €50,000.

Both penalties are suspended, meaning the company – which suspended UberPop in France last year – and its senior staff will only have to pay half the amount if they do not commit another offence.

A regional court in Frankfurt also upheld Germany’s ban on UberPop, its lower cost service, rejecting an appeal by the San Francisco-based firm. The UberPop service connects customers, via a smartphone app, with non-professional drivers using their own cars. The Frankfurt ruling means Uber can be fined for violation of local transport laws if it uses drivers who are not licensed by the state in order to cut costs.

Uber has used licensed drivers in the UK since it launched, in anticipation of objections from the strong private hire taxi lobby here. The verdicts in two of the European Union’s key member states come just days after the European commission called on governments to consider banning Uber – and other sharing economy firms – only as a last resort.

The commission’s new guidelines also state that service providers should only be required to obtain licences "where strictly necessary to meet relevant public interest objections”. Despite the commission’s calls for restraint, a clutch of European countries have already set out their stall against Uber.

The Californian startup’s rapid expansion since it launched in 2009 has triggered a series of courtroom battles, as traditional taxi services fight to protect their turf. UberPop been declared illegal by courts in Italy and Spain while appeals are pending in Belgium and the Netherlands.

The ruling in Frankfurt means Germany will remain on the list of countries to have banned UberPop. Uber did not say whether it intends to dispute the German ruling. But it said the verdict would not do much damage to its business in Germany because it already suspended its low-cost service there about a year ago.

The firm said it was now concentrating its efforts on its more upmarket sedan services with licensed drivers.

Uber expressed greater disappointment with the French ruling. "We stopped UberPop last summer and we are disappointed by this judgment,” the firm said in a statement.

"The European commission has just published guidelines that support such services. The judgment does not impact our service in France today – which now connects more than 12,000 professional drivers with 1.5m passengers – but we will appeal.”

While several European states have put legal obstacles in the way of Uber’s expansion, the taxi service has also faced fierce opposition in other parts of the world. Protests by taxi drivers in Jakarta, Indonesia, erupted into violence earlier this year, while Brazil initially moved to ban Uber outright before the law was overturned, sparking anger from taxi drivers in Rio de Janeiro.

But opposition to Uber has not dissuaded investors who have placed major bets on its ongoing expansion. Saudi Arabia agreed to invest $3.5bn (£2.4bn) in the company earlier this month, while the world’s biggest carmaker Toyota agreed a partnership with Uber that will see it offer drivers favourable leases on cars.