By Alistair Smout
LONDON (Reuters) – Uber [UBER.UL] accepted it had made mistakes but said it had changed on Monday in a court challenge to a decision stripping it of its London license after it was ruled unfit to run a taxi service in its most important European market.
Backed by Goldman Sachs and BlackRock among others and valued at over $70 billion, Uber has faced protests, bans and restrictions around the world as its app challenges traditional taxi operators and angers some unions.
Transport for London (TfL) refused to renew Uber’s license in September, citing failings in its approach to reporting serious criminal offences and to background checks on drivers.
The court case is a test of how far Uber can demonstrate it has changed and while the appeal process is ongoing, Uber can continue to operate in the city.
Judge Emma Arbuthnot said she would likely decide the case on Tuesday, after hearing evidence from transport regulator TfL.
The Silicon Valley firm’s chief executive Dara Khosrowshahi, who took charge the month before TfL’s decision, has since pledged to “make things right” in London and Uber has introduced several new initiatives, including 24/7 telephone support and the proactive reporting of serious incidents to the city’s police. It has also changed senior management.
Uber’s lawyer Thomas de la Mare said it accepted the ruling and the focus of the appeal should be on its reforms.
“We accept it was right,” de la Mare told Westminster Magistrates Court, adding it had addressed TfL’s concerns.
“It’s that acceptance that has led to wholesale change in the way that we conduct our business.”
INACCURATE, INCOMPLETE, INADEQUATE
Uber UK’s General Manager Tom Elvidge admitted its correspondence with TfL had at times been inaccurate, incomplete and inadequate.
But Elvidge said that a change of personnel and policies would help avoid similar issues in the future, and credited Khosrowshahi with changing the broader culture of the company after the resignation of his predecessor, Travis Kalanick.
Kalanick stepped down a year ago following investor pressure after a string of scandals on his watch.
Uber’s Laurel Powers-Freeling said that she also had seen evidence of a shifting culture at the firm, after the banking executive was appointed its first UK Chairman in the aftermath of the ruling.
“I’ve seen a lot of cultural change. I’ve seen a lot of improvement in the systems and processes” Powers-Freeling, who has been in post since November, said.
The GMB trade union said that Uber needed to demonstrate that it had adopted “real change” in its approach to passenger safety in order to win back its license.
After its application for a five-year license was rejected last year, Uber is now seeking an 18-month one to prove to the authorities that it has reformed.
Judge Arbuthnot’s decision, which can take Uber’s reforms since the original ruling into account, can be appealed again, meaning the whole legal process could take years.
She signaled any license renewal could be for a shorter period.
“I would’ve thought, if I were to renew the license, 18 months would be rather too long,” she said.
Martin Chamberlain, lawyer for TfL, said that the steps Uber had taken should be seen in the context of its past conduct, and any license that the judge awarded should be short and subject to stricter conditions which the regulator has agreed with Uber.
At stake for the U.S. firm is one of its most crucial foreign markets. Of its over 60,000 drivers in Britain, about 45,000 are in London.
Since September’s decision, Uber has also been stripped of its license by the southern coastal city of Brighton, in a decision which it is appealing, and the northern city of York.
It has, however, gained new licenses in Sheffield, Cambridge, Nottingham and Leicester.
(Reporting by Alistair Smout and Costas Pitas; Editing by Stephen Addison/Mark Potter/Alexander Smith)