The decision by Uber to terminate its Colombian operations on February 1, 2020, just six years after its launch in the country to offer a ridesharing alternative, ends a long legal battle between the company, government regulators and yellow taxi operators.
The ruling by the Superintendence of Industry and Commerce (SIC) to suspend Uber operations citing the company did not pay mobility fees standard taxis are subject to by using its digital platform status as a loophole, effectively shut down ridesharing in the short term for Uber Colombia’s 2 million registered users and forces 88,000 drivers, to migrate to other platforms – Cabify, Didi and Beat – which continue to provide the service.
Uber claims the SIC ruling is “arbitrary” as it does not ban competitors, nor other app-based companies including its delivery service Uber Eats. For the guild of yellow cab operators, Uber’s departure from Colombia cements their monopoly, but users view the ruling as a victory for unsafe cabs and return to adulterated taxi meters.
According to guild representative Hugo Ospina, the yellow cab companies plan on adding 40,000 new licenses to receive ex-Uber drivers. Colombia is the first Latin American country to ban the service, even though Uber has faced legal obstacles in many countries, most recently, in Germany and Italy.
In response to the SIC ruling, Uber could file a lawsuit against the Colombian government for violating technology and information terms of the Free Trade Agreement with the United States. Uber’s Colombia experience, however, has been anything but a smooth ride so far, and focus of many protests by unions claiming unfair competition as the app-hailed drivers do not have official public transportation documents.
Uber was allowed to operate in the country by the Ministry of Information Technology and Communications, but its drivers were subject to regulations of the Ministry of Transportation. This policy vacuum meant Uber drivers could be sanctioned by police if stopped and their privately-owned vehicles impounded.
Uber posted on its Twitter account a farewell message for Colombians saying: “Goodbye … hopefully, see you soon,” but given negative reaction by the public to the ruling, Uber’s days in the country could over for the short-haul, yet given the company’s global track record for a comeback and President Iván Duque’s promotion of digital technologies as a pillar of economic growth the future of ridesharing will depend on government initiatives to regulate, and not lawyers to dictate.