BUSINESS
08/12/2015 12:29 pm ET Updated Aug 12, 2015

9 Countries That Aren't Giving Uber An Inch

As Uber breaks into markets all over the world, governments and taxi drivers push back -- hard.
Credit: Bloomberg via Getty Images

Uber's reputation isn't great: It has barged relentlessly into new markets, both in the U.S. and internationally, upsetting local governments and riling up traditional taxi drivers.  

In recent weeks the ride-hailing company, valued at a colossal $50 billion, has butted heads with the mayor of New York City, received a $7.3 million fine for failing to provide data to California regulators and been the target of yet another protest by taxi drivers, this time in Cambridge, Massachusetts. Things aren't going much smoother elsewhere in the world.

Below, staffers from nine of The Huffington Post's international editions give their take on Uber’s impact in their countries and the challenges the company faces from governments, as well as rival services and taxi companies.

 

BRAZIL 

<span>Hundreds of taxi drivers from Rio de Janeiro, Sao Paulo and Belo Horizonte block the avenue which links South and Cente
VANDERLEI ALMEIDA via Getty Images
Hundreds of taxi drivers from Rio de Janeiro, Sao Paulo and Belo Horizonte block the avenue which links South and Center Rio de Janeiro on July 24, 2015, to protest against UBER, a mobile phone application to hail taxi.

Uber has been used in Brazil since last year, but only in four major cities: São Paulo, Rio de Janeiro, Belo Horizonte and Brasília. Since it is a user-friendly app and broke up the monopoly of cab drivers on individual transport, Uber use has increased a lot over the first half of 2015. Uber is the preference for passengers who appreciate safety, more diversity in payment options (due to credit cards) and promotional offers. 

Since cab drivers are very organized here in Brazil, they have been frequently protesting against Uber. They complain that since they pay taxes, Uber drivers or owners should too.

In some cases, cab drivers have been violent. In Belo Horizonte, they've persecuted Uber drivers. In Rio de Janeiro, threats are common, and there was a massive protest against Uber there in late July. In Brasília, a man was attacked by mistake in the airport of Brazil's capital after cab drivers thought he was an Uber user.

Due to the organization of cab drivers, their lobbying power is huge. And in most cities where Uber is used, politicians are working for its prohibition.

In São Paulo and Brasília, local legislators have approved different projects to forbid Uber. The mayor of São Paulo has to decide if this prohibition will become a law. The governor of Brasília vetoed the ban on Uber, although this doesn't technically legalize the service. In Rio de Janeiro and Belo Horizonte, Uber is still running without legal constraints. But their municipal chambers are expected to be as strict as in the other cities. 

-- Diego Iraheta, editor-in-chief, Brasil Post

 

CANADA 

<span>TORONTO, ON - MAY 14 - Photographed at Dundas Square, Toronto, Uber taxi service is a new alternative way to traditiona
Bernard Weil via Getty Images
TORONTO, ON - MAY 14 - Photographed at Dundas Square, Toronto, Uber taxi service is a new alternative way to traditional taxi to travel around the city.

Uber is succeeding commercially in Canada, having made major inroads in Toronto, Montreal and several other cities, but the service is headed for conflict just about everywhere it operates here.

While those who use the app laud it for lowering transportation costs, the taxi industry says it’s in crisis. Some cabbies in Toronto say they have lost half their business to the relatively cheap UberX service. Municipalities are concerned UberX drivers aren’t declaring and paying sales taxes on their income. For these reasons, the taxi industry and many municipal bureaucracies have, in effect, joined forces to stop Uber.

Canadian municipalities have been slow to respond with policy changes, preferring to deal with the matter through the courts. Both Toronto and Montreal launched blitzes this year in which UberX drivers were charged with violating laws requiring a professional license to carry passengers for money.

The taxi industry is also taking to the courts: In July, it launched a class-action lawsuit against Uber in the province of Ontario, seeking $400 million in compensation for lost revenue and asking the courts to shut down the service permanently.

However, policy changes are likely ahead that will allow Uber to operate, though it remains to be seen under what conditions. Toronto Mayor John Tory has expressed his support for Uber (though most of the rest of city council hasn’t), and cities are slowly beginning to look at regulatory options.

-- Daniel Tencer, business editor, The Huffington Post Canada

 

CHINA 

ASSOCIATED PRESS

Uber faces immense challenges in China due to entrenched taxi interest groups, local Chinese competitors and an unclear legal framework. Both Uber and its local rival, Didi Kuaidi, have faced protests from taxi drivers and sporadic crackdowns from police who have fined drivers and raided Uber offices in some cities. Conflicts with police grew so intense that Uber threatened to fine any drivers who drive toward the scene of a confrontation.

Uber won the hearts of riders in many cities with hugely subsidized rides, even becoming the subject of a viral (and subsequently censored) rap song. But despite the huge investment, it remains unclear if Uber will even be allowed to operate in the future.

Either way, it has permanently changed the operating environment for official taxis.

-- Matt Sheehan, China correspondent, The Huffington Post

 

FRANCE 

<span>Smoke rises as demonstrators light firecrackers at Porte Maillot in Paris on June 25, 2015, as hundreds of taxi drivers
THOMAS SAMSON via Getty Images
Smoke rises as demonstrators light firecrackers at Porte Maillot in Paris on June 25, 2015, as hundreds of taxi drivers converged on airports and other areas around the capital to demonstrate against UberPOP.

Uber established new quality standards. The country's main taxi company, G7, has been slowly following Uber's path since 2012: It developed an app, asked drivers to wear a suit and applied fixed fares for airports.

The government is pro-taxi. It first tried to block Uber development, and then chose to regulate the app with the "Thevenoud law," which allows licensed UberX drivers but forbids UberPop, a low-cost service that employs drivers who don't have commercial licenses. So Uber challenged the law in court to prevent its application, then taxis and the government got angrier, and so on. The situation culminated in the Paris taxi drivers' violent anti-Uber protests in late June.

Though the violence was quite unpopular, the government backed taxis and announced enforcement of the controls on the same day. Soon after, two top Uber managers were arrested for “illicit taxi service.” Their judgement is expected Sept. 30.

In early July, Uber announced UberPop was suspended until a new decision of justice. 

-- Jean-Baptiste Duval, business editor, Le Huffington Post

 

GERMANY 

<span>A smartphone displays the Uber app in this arranged photograph as taxis and the Brandenburg Gate stand beyond in Berlin
Bloomberg via Getty Images
A smartphone displays the Uber app in this arranged photograph as taxis and the Brandenburg Gate stand beyond in Berlin, Germany, on Monday, Nov. 24, 2014.

Uber has had a lot of trouble conquering the German market.

Earlier this year, a regional court argued that UberPop had violated German law because its drivers didn't have licenses for transport. The court banned Uber from running the service with unlicensed drivers and set fines for any violations of local transport regulations. Taxi drivers organized several protests as well.

So Uber had to stop its UberPop service, as it did in France. It resumed service under the name UberX in May -- with guarantees that its cars and drivers would comply with specific legal requirements.

But taxi drivers remain skeptical. The taxi driver trade union says it will observe whether Uber is abiding by local regulations.

Uber, frustrated, has criticized the German courts for trying to force the digital platform to comply with laws "dating back to the '50s." The app also brought its concerns about the restrictions to the European Commission, which is currently investigating the complaint.

-- Tobias Fülbeck, editor, Huffington Post Germany

 

INDIA 

<span>An Indian cab driver displays the city map on a smartphone provided by Uber as he drives in New Delhi, India, Friday, J
ASSOCIATED PRESS
An Indian cab driver displays the city map on a smartphone provided by Uber as he drives in New Delhi, India, Friday, July 31, 2015.

Uber has made it way easier than before to commute in Indian cities. Traditional operators were unorganized and unreliable. Cabs often failed to arrive on time, and the number of cars was far less than demand. Uber’s service made it possible to order cabs at short notice and for shorter distances, which traditional cabs would often refuse to travel. It is also cheaper than any other service.

Uber has inspired India’s homegrown taxi-hailing apps such as Ola, which is now present in 100 cities, compared with 16 for Uber. Smartphones have become widespread in Indian cities, and such apps are making a real difference for people. 

After a woman was allegedly raped by an Uber driver in Delhi, the city government banned the service, along with other taxi-hailing apps. It then introduced rules which said that Uber should get a radio-cab license by fulfilling conditions like owning its own cabs, providing designated parking slots and so on. Uber filed for a licence, but was rejected. However it continues to operate in Delhi, after Ola got a favorable court ruling for such apps. But it will still need a licence for the ban to be lifted.

-- Anirvan Ghosh, business editor, The Huffington Post India

 

JAPAN 

<span>A driver opens the door for a customer during a demonstration outside the Uber Japan Co. office in Tokyo, Japan, on Wed
Bloomberg via Getty Images
A driver opens the door for a customer during a demonstration outside the Uber Japan Co. office in Tokyo, Japan, on Wednesday, March 5, 2014.

Uber started its Tokyo business in November 2013. The company has had tremendous difficulties making inroads into the Japanese market, partly due to Tokyo's availability of more than 50,000 taxis -- about 20 percent of the nation's total taxis and nearly four times the number in New York. Intensifying competition from local taxi operators hasn't helped, either.

This year, the country's largest taxi company, Nihon Kotsu, struck back at Uber by launching a partnership with local mobile messaging company Line. The new ride-hailing service, called Line Taxi, is an expansion of Nihon Kotsu's existing app.  

In January 2014, the Tokyo Hire-Taxi Association also took a swipe at Uber, introducing a mobile app service that allows users to connect with around 6,500 cabs in central areas of Tokyo. The Japanese e-commerce giant Rakuten also entered the ride-sharing industry by purchasing an 11.9 percent stake in Lyft in March. 

In March, Japan’s transport ministry ordered Uber to suspend a pilot project for its ride-sharing business in the city of Fukuoka because it violated the laws prohibiting unlicensed taxi services. 

-- Kosuke Takahashi, editor-in-chief, The Huffington Post Japan

 

KOREA 

<span>Taxis queue for passengers in downtown Seoul on March 31, 2015. South Korea's top mobile messenger operator launched a
JUNG YEON-JE via Getty Images
Taxis queue for passengers in downtown Seoul on March 31, 2015. South Korea's top mobile messenger operator launched a new web-based cab-hailing service to compete with California-based Uber, whose service has been subjected to crackdowns from state regulators.

Uber's arrival clearly set the bar higher for the taxi industry. The general consensus among most people in Korea's big cities was that the quality of taxi services is not great. Uber hasn’t made a huge change in that, but people's take on the quality of taxi service has changed a lot. The expectation is a lot higher!

That is partly because of the fact that Uber arrived in 2013 with its flagship service, Uber Black, which was a kind of service none of us ordinary people had ever experienced to a certain extent. It made the best effort to make the service popular in this country by cutting fares, doubling referral credits, offering promotions and running ads highlighting its differences from the country's existing premium taxi service. It then went on to launch UberX and Uber Taxi.

The introduction of Uber triggered a huge competition for on-demand taxi services which had never really existed. A number of startups successfully built a similar service, and then Daum Kakao, the second biggest Internet company in Korea, developed its own on-demand taxi service called Kakao Taxi. (It's actually nothing like UberX, rather more like a normal call-taxi.)

Like everywhere else around the world, Uber has provoked a lot of controversy. Existing taxi companies don’t like Uber and went on strike in November 2014, so the government had to do something. Basically, UberX service is totally illegal because drivers without taxi licenses cannot do business with their own cars. Uber somehow ignored this fact and launched UberX, but the company soon announced its suspension in March.

Uber blamed the government for not allowing its service, insisting the authority is too old and conservative. But it was clear that the pressure had been mounting, as Uber's CEO had been charged in December with violating local transportation regulations. 

-- Wan Heo, news editor, The Huffington Post Korea

 

SPAIN 

<span>&nbsp;BARCELONA, SPAIN - JULY 01: In this photo illustration the new smart phone taxi app 'Uber' shows how to select a
David Ramos via Getty Images
 BARCELONA, SPAIN - JULY 01: In this photo illustration the new smart phone taxi app 'Uber' shows how to select a pick up location backdropped by La Sagrada Familia on July 1, 2014 in Barcelona, Spain.

Uber has had a rather limited impact in Spain, particularly due to the short time it had to establish itself in the country. 

It arrived in Barcelona (Catalonia), for the first time in a Spanish city, in May 2014, with relative success among users. But it sparked strong protests from taxi drivers. The controversy revived in September 2014, when the service reached Madrid. Irritation rose among professional drivers, resulting in a strike that affected both cities. Taxi drivers demanded Uber’s activities be stopped; they considered the company to be unfair competition, since it worked without the expensive license that taxi drivers need to acquire in order to perform their job legally.

In this tense context, by the end of 2014, a ruling from a Madrid court forced the company to shut down everywhere in Spain. The court ruled that Uber’s activities should be terminated and prohibited in the whole country as a cautionary measure, due to a denunciation from the taxi drivers association. After this, a judge in Barcelona requested the Court of Justice of the European Union to determine whether the activities of said service present an unfair competition against taxi drivers. The company’s services have yet to return in Spain.

The EU court should decide during the next year whether Uber is a transportation company or a company offering "information society services." While the latter ruling might afford Uber certain protections under EU laws, the former could force the company to comply with stricter national rules on licensing, insurance and safety. 

Since the prohibition, the company has reinvented itself by taking advantage of its wide network of drivers. It has now forged a partnership with some restaurants and launched UberEats, a super-fast service for food delivery.

-- Rodrigo Carretero, editor, The Huffington Post Spain

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