West Midlands Conservative MEP Dan Dalton is warning that the future of internet-based services such as Uber and Airbnb has been thrown into doubt by an opinion issued today by the European Court of Justice.
The opinion from the Advocate General of the court follows a case brought by Spanish taxi drivers against the ride sharing service Uber. The Advocate General recommends that Uber should be regulated like a transport company, and not simply be regarded as a passive online platform linking passengers and drivers.
Mr Dalton, who specialise in policy relating to connectivity, online media and digital commerce, said: "This is potentially very bad news for consumers, for the sharing economy and for the businesses concerned."
If the opinion is upheld Uber, and other so-called information society services such as Airbnb, would be subject to a raft of regulations. In Uber's case, it would be required to obtain licences and authorisations like standard taxi firms. It would also fall under regulations applying in some UK cities which limit the number of taxis allowed to operate.
The court's final judgment will follow later this year. Typically the judgment judges follow Advocate General's advice, so Uber is likely to be branded either a transport company or a hybrid transport-internet business.
Mr Dalton, a member of the European Parliament's Internal Market and Consumer Protection Committee, said the opinion had huge implications for innovative, consumer driven digital services all across Europe.
“Consumers embrace services like Uber because they deliver good services at good prices, in contrast to old monopolies which have not kept pace with digital evolutions," he said. "Workers embrace them because they offer flexible working times and conditions.
“It is right that there are safeguards for consumers, but applying analogue era regulation to the digital world only strangles innovation and entrenches privileged monopolies."