On September 24, Uber obtained a two-month permit to continue operating in London—a permit that falls far short of the five-year permit it sought. This signifies the second time that Transport for London (TfL), the city’s licensing authority, has rebuffed the ride-hailing firm. Further signaling distrust of the ride-sharing app, TfL imposed conditions on the two-month permit that allows it to scrutinize the company. With Uber already struggling with regulatory pressures and large net losses, TfL’s decision comes at a most inopportune time.
TfL and Uber’s stormy relationship goes back a few years. After initially issuing a five-year license to the company in 2012, TfL announced in 2017 that it would not renew Uber’s operating license. That decision was motivated in part by concern for passenger safety and Uber’s use of a software that could block authorities from accessing the app. However, the decision also sparked a court battle whereby TfL eventually had to grant the app-based company a 15-month license—an outcome characterized by London’s mayor, Sadiq Khan, as putting Uber “on probation.”
Now, a day before the 15-month license was set to expire, Uber has obtained a short two-month permit. The permit comes with additional requirements that, according to TfL, are aimed at ensuring passenger safety. While the transport authority has provided few details, under the new requirements, Uber must regularly provide assurance reports and must work with the London Metropolitan Police to report passenger complaints. Further, Uber will have to notify TfL of changes to its operating model in London at least twenty-eight days in advance, and it will have to add three non-executive members to its board.
The disappointingly short permit for the largest European taxi market is another in a streak of setbacks for the company. On the other side of the Atlantic, Uber is currently fighting Assembly Bill 5, a new California legislation that could significantly increase costs by reclassifying drivers as employees from their current status as independent contractors. Meanwhile, this August, Uber reported its largest quarterly net loss—$5.24bn—with the company resorting to cutting more than 400 jobs. With its stock price slipping since its initial public offering in May, pressure for Uber to succeed is now higher than ever.