Economy
Brussels to call on EU governments not to ban Uber, Airbnb
The EU executive will this week set out guidelines to harmonize the often wildly different treatment faced by businesses trying to shake up sectors ranging from accommodation to transport across the 28-country bloc.
While businesses such as ride-hailing company Uber have been welcomed by countries including the UK, their executives have been threatened with stiff fines or even jail in places such as France, the FT said.
Coherent regulation on an EU-wide basis would provide a huge boost to these businesses, negating the need for companies to have fights with 28 different regulators.
Although most of the new guidelines are expected to be welcomed by the predominantly U.S. groups that dominate the so-called sharing economy sector, some will cause concern in Silicon Valley, the paper added.
The Commission suggests that companies that do not allow their operators to set their own prices or that force them to take customers could be considered an "employment relationship".
“Any such definition would be resisted by Uber, which has vociferously argued that its drivers are not employees, meaning that the company does not have to do things such as contribute to social insurance schemes on their behalf," the FT added.
Uber has already faced partial prohibition in countries across the EU, including Belgium, the Netherlands, France and Germany. Hungary is also working on legislation to ban Uber.
The National Development Ministry has recently said that the technical conditions to banning Uber could be created by the end of the year at the latest. Should Prime Minister Viktor Orbán’s cabinet decide to take Uber off the streets, a law enabling the blocking of Uber’s application may enter into effect at the end of June. The final vote on the matter is expected in the first week of June.The European Commission also came out in defence of rating systems used by the likes of Uber, arguing that being able to rate a driver can lead to safer services. Critics of this system have argued that relying on reviews to judge drivers was potentially unsafe, the FT said.
Brussels also dislikes Berlin's attempt to crack down on Airbnb hosts by introducing fines of up to EUR 100,000 for people who rent out their entire apartments on the home-letting website. The EC said such rules were "generally difficult to justify", and instead it urges countries to consider measures such as introducing limits on the number of days someone can rent out an apartment on websites such as Airbnb.
“The guidelines are intended to encourage EU countries to look again at their regulation of sharing-economy businesses," the FT said, reminding that companies such as Uber have already complained to Brussels about their treatment in various countries. Results of these investigations are expected in a few months.
While businesses such as ride-hailing company Uber have been welcomed by countries including the UK, their executives have been threatened with stiff fines or even jail in places such as France, the FT said.
Coherent regulation on an EU-wide basis would provide a huge boost to these businesses, negating the need for companies to have fights with 28 different regulators.
Based on a draft seen by the FT and to be published on Thursday, government should ban such services only as a “measure of last resort".
The FT also said the move to help new entrants “will ease some of the tension over technology regulation between Brussels and Washington, where Europe's efforts to rein in the market power of the likes of Google and Apple have caused friction." It reminded that in 2015, U.S. President Barack Obama accused the EU of regulation that was "designed to carve out some of their commercial interests".Although most of the new guidelines are expected to be welcomed by the predominantly U.S. groups that dominate the so-called sharing economy sector, some will cause concern in Silicon Valley, the paper added.
The Commission suggests that companies that do not allow their operators to set their own prices or that force them to take customers could be considered an "employment relationship".
“Any such definition would be resisted by Uber, which has vociferously argued that its drivers are not employees, meaning that the company does not have to do things such as contribute to social insurance schemes on their behalf," the FT added.
Uber has already faced partial prohibition in countries across the EU, including Belgium, the Netherlands, France and Germany. Hungary is also working on legislation to ban Uber.
The National Development Ministry has recently said that the technical conditions to banning Uber could be created by the end of the year at the latest. Should Prime Minister Viktor Orbán’s cabinet decide to take Uber off the streets, a law enabling the blocking of Uber’s application may enter into effect at the end of June. The final vote on the matter is expected in the first week of June.The European Commission also came out in defence of rating systems used by the likes of Uber, arguing that being able to rate a driver can lead to safer services. Critics of this system have argued that relying on reviews to judge drivers was potentially unsafe, the FT said.
Brussels also dislikes Berlin's attempt to crack down on Airbnb hosts by introducing fines of up to EUR 100,000 for people who rent out their entire apartments on the home-letting website. The EC said such rules were "generally difficult to justify", and instead it urges countries to consider measures such as introducing limits on the number of days someone can rent out an apartment on websites such as Airbnb.
“The guidelines are intended to encourage EU countries to look again at their regulation of sharing-economy businesses," the FT said, reminding that companies such as Uber have already complained to Brussels about their treatment in various countries. Results of these investigations are expected in a few months.
In general, the commission has given sharing economy businesses a more sympathetic hearing. Elzbieta Bienkowska, the commissioner for industry and the internal market, last year compared critics of Uber with those who had railed against the introduction of printing presses in medieval times.
The FT reminded that both Paris and Berlin have been keen on keeping a far stricter eye on new entrants, arguing that national regulations should not be diluted for their sake.
