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Uber is shutting down its operations in Denmark less than three years after launching in the country. The company said upcoming changes in Danish taxi legislation had left it with “no choice” but to close the service.
The new law, which was passed in February, requires taxis to install fare meters and seat occupancy detector sensors. These rules are problematic for Uber to enforce because its drivers operate their own cars and use the Uber mobile app to track and arrange their rides.
“Our top priority is supporting the drivers who use Uber during this difficult time,” said Kristian Agerbo, the company’s spokesperson in Denmark. “We will continue to work with the government in the hope that they will update their proposed regulation and again enable Danes to enjoy the benefits of modern technologies like Uber.”
The San Francisco-based company said its service was used by more than 2,000 drivers and 300,000 riders in Denmark. The ride-sharing service will be shut down on 18 April, but the company hinted at a relaunch if the legislation changes. Uber will also keep a team of 40 engineers in Aarhus, Denmark’s second largest city, who will continue to develop its technology.
It has been a rough ride for Uber since the company launched in Denmark in late 2014. The ride-hailing app has faced demonstrations from Danish taxi drivers from the start, including a protest over the company speaking at a startup event in Copenhagen in March 2016.
The company suffered a major blow in December 2016 when a Danish high court indicted Uber on charges of assisting two drivers to violate local taxi laws and the new legislation seems to have been the final straw for the company.
Uber has caused similarly heated reactions elsewhere in the Nordics and Europe, where taxi drivers and operators have accused it of not adhering to local legislation and distorting competition.
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In Finland, the police have been clamping down on Uber drivers with criminal charges and last October it said it was investigating 200 suspected cases of unlicensed taxi services. The situation might ease in mid-2018 when proposed taxi industry reform comes into force in the country with no limit on the number of taxi licences issued, although a licence will still be required.
Uber itself says it is not a taxi company, but provides a mobile platform for connecting passengers and drivers. This is currently being considered by the European Court of Justice, which is expected to rule later this year whether the company is providing a “transport service” or “information society service”.
It could be a defining moment for the company in Europe as the former would require Uber to comply with the relevant rules and legislation, and the latter would provide more leeway for the company to operate.