The company has rebounded under CEO Dara Khosrowshahi and convinced the court it has changed its ways.
On 26 June 2018 Judge Emma Arbuthnot granted the ride-sharing company a 15-month probationary licence to continue operating in the UK capital. The ruling gives some peace of mind to the 45,000 people who drive Uber vehicles in London.
The court imposed some conditions on Uber’s licence. The company must provide regulators with the results of an independent review into its procedures and safety policies every six months. It is also obliged to update UK regulators about any changes it makes to its company policy.
Despite these stipulations, the decision confirms the company is again on the ascent after Khosrowshahi took over the top job in the wake of a series of scandals. London’s transport regulator Transport for London (TfL) had rejected the company’s application to renew its operating licence in September 2017, saying it was not a “fit and proper” operator. The company was allowed to continue operating while the court reviewed its application.
No matter how big or powerful you are, you must play by the rules – especially when it comes to the safety of Londoners. @Uber has been granted a 15-month licence to operate in London – but with a clear set of conditions that @TfL will closely monitor and enforce. pic.twitter.com/5k80UtQp75
— Sadiq Khan (@SadiqKhan) June 26, 2018
Uber has been ordered to pay TfL’s legal costs, which may run to hundreds of thousands of pounds.
Uber concedes past mistakes
In an opinion piece on the issue, Sadiq Khan, the mayor of London, wrote: “Uber has now accepted in open court that TfL was right not to grant them a licence to operate at the time. In Uber’s own words, it had made “serious mistakes” that left TfL unable to conclude it was fit and proper to hold an operator’s licence.
Counsel for Uber, Thomas de la Mare QC, said the company had implemented “wholesale change” after having its application to renew its licence rejected. De la Mare added that Uber had passed its last three TfL inspections and achieved a “perfect record of compliance” in recent months. He also detailed how Uber had added three non-executive board members with a brief to ensure “total compliance to the letter and spirit” of all regulatory requirements.
Rory Cellan-Jones, a BBC technology correspondent, said Uber had successfully pursued a “humility strategy” after initially striking a defiant tone when TfL refused to renew its licence. At the hearing, it advanced an argument that mistakes had been made during the company’s unexpectedly brisk growth.
— CNN (@CNN) June 26, 2018
London is a key market for Uber with some 3.6 million people using its services. Uber’s newfound willingness to admit past mistakes and change its internal processes may also prove crucial for it to withstand challenges from other regulators around the world.
The judge ruled that Uber must provide training for its drivers. It will also be required to report and deal with any safety complaints against its drivers within 48 hours and must notify authorities when it bans a driver from its platform.
Uber rocked by scandals
One of the concerns of TfL was Uber’s inadequate processes for reporting crimes. Helen Chapman (Director of licensing, regulation and charging at TfL) described Uber’s conduct in this area as “very disturbing” during the hearing.
Under founding CEO Travis Kalanick, Uber had been strongly criticised for allowing a culture of sexism to flourish. It also had to admit that hackers had accessed the data of millions of users and drivers.
Further, there were serious concerns raised about the company’s insufficient background checks and use of the Greyball software tool to elude regulators.
Internal emails obtained by The New York Times revealed Khosrowshahi admitting “there is a high cost to a bad reputation” and conceding the company needed to do better in terms of complying with local rules and engaging with regulators.