Uber gains London licence for just 2 months

Uber has failed to obtain a long-term licence to operate in London as the city’s transport agency granted its ride-hailing service just a two-month permit.

The decision hands an advantage to its growing number of rivals and threatens to disrupt its business in one of the world’s largest taxi markets ahead of the Christmas period.

Uber’s licence, issued just a day before its previous permit expired, comes with new conditions designed to improve passenger safety. Transport for London, the capital’s licensing authority for private hire services, said it was seeking “additional information” from Uber before considering a longer term licence. 

A source close to the process said: “There are issues over safety, identification and insurance. There are concerns around these points and Uber need to more provide more information on them.”

In response on Tuesday, Uber said it would “keep listening, learning and improving” and provide any information that TfL requested. 

But the two-month licence falls far short of the maximum five-year permit that Uber could have hoped to obtain. It puts the San Francisco-based company on a much tighter leash than several new competitors in London including SoftBank-backed Ola that has been granted longer licences in recent months. 

“Granting Uber a two-month temporary licence clearly shows that the firm have failed their probation and are still a huge threat to public safety,” said Steve McNamara, general secretary of the Licensed Taxi Drivers’ Association. 

Uber won a new 15-month London licence in June 2018 only after a court battle that ended with strict new conditions being imposed on the company. TfL had withheld Uber’s permission to operate the previous September, just weeks after Dara Khosrowshahi took over as its chief executive, over concerns that it was not a “fit and proper” company to hold the permit.

Uber had faced a series of scandals in 2017, from allegations of misleading regulators to workplace harassment.

The court last year found that Uber had improved its culture and governance after co-founder Travis Kalanick had been replaced by Mr Khosrowshahi, alongside other changes to its UK management team. Mr Khosrowshahi had made winning back its permit in the city a benchmark for his reforms at the company. After his apparent vindication, he promised Londoners: “We won’t let you down.”

Tuesday’s decision by TfL threatens to undo some of that progress. 

“Uber London Limited has been granted a two-month private hire operator licence to allow for scrutiny of additional information that we are requesting ahead of consideration of any potential further licensing application,” TfL said. The extra conditions for the two-month licence include insurance and document checks.

Jamie Heywood, Uber’s regional general manager for Northern and Eastern Europe, said: “TfL’s recognition of our improved culture and governance reflects the progress we have made in London. We will continue to work closely with TfL and provide any additional requested information.”

Over the course of this year, London has seen several new ride-hailing entrants that have been aggressively discounting their services to win customers. Ola was granted a 15-month licence in July, while other new competitors include French app Kapten and Bolt, which is backed by Uber’s Chinese rival Didi Chuxing.

A spokesperson for London Mayor Sadiq Khan said the new conditions imposed on Uber were designed to “ensure the highest standards around passenger safety”. 

“Regulations are in place to keep Londoners safe, and fully complying with these strict standards is essential if private hire operators want a licence to operate in London,” the Mayor’s office said. “Sadiq has been crystal clear that in London it doesn’t matter how powerful and how big you are, you must play by the rules.”