By Alistair Smout

LONDON (Reuters) - Uber [UBER.UL] will hear on Tuesday if a bid to overturn a ruling stripping it of its licence to operate in London has succeeded, after a court heard about its difficult relationship with the city's transport regulator.

The taxi-hailing app overhauled its policies and personnel in Britain after Transport for London (TfL) refused to renew its licence in September for failings in its approach to reporting serious criminal offences and background checks on drivers.

"We've had five years of a very difficult relationship, where Uber has felt that it hasn’t required regulation," TfL's licensing director Helen Chapman told the court on Tuesday, adding it had been "frankly frustrating" that issues TfL should have been aware of were first reported in the media.

 

While the appeal process is ongoing, Uber can continue to operate in the city, and Tuesday's decision can also be appealed, meaning the whole legal process could take years.

With backers including Goldman Sachs and BlackRock and valued at more than $70 billion, Uber has faced protests, bans and restrictions around the world as it challenges traditional taxi operators, angering some unions.

Uber, which has about 45,000 drivers in London, introduced several new initiatives in response to the ruling, including 24/7 telephone support and the proactive reporting of serious incidents to police. It has also changed senior management in Britain, its biggest European market.

The ruling has been a test of Uber's new management at the board level, with chief executive Dara Khosrowshahi, who took charge the month before TfL's decision, pledging to "make things right" in London.

Uber's corporate culture has changed since Khosrowshahi's arrival, company officials told the court on Monday, promising better practices and more transparency.

After its application for a five-year licence was rejected last year, Uber is now seeking an 18-month one to prove to the authorities that it has reformed. But Judge Emma Arbuthnot said on Monday she thought 18 months "would be rather too long."

Arbuthnot said on Tuesday she expected to give the judgment at around 1600 GMT.

TfL's lawyer told the court on Monday that if a licence was granted by Arbuthnot, it should be under strict conditions which the regulator has agreed with Uber, and for a short duration, as there were questions whether Uber's changes could be trusted.

Asked if Uber's more proactive approach since the ruling showed the relationship with the regulator had improved, Chapman said: "It certainly works better when an operator is seeking permission rather than forgiveness."

(Reporting by Alistair Smout; Additional reporting by Costas Pitas; Editing by Alexander Smith and Mark Potter)

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