Uber - Why Downing Street Panicked

The pressing of the panic button by driver and rider matching service Uber, representatives of the Foreign Office, and those within Downing Street when Transport for London looked likely to take enforcement action on the basis that Uber’s operation in the capital was illegal, was detailed on Zelo Street yesterday. Now it can be revealed exactly what caused the panic - and the brazen attempt to side with Uber.

On December 10, 2013, TfL officials Helen Chapman and Garrett Emmerson were in receipt of communication from lawyers Clifford, Chance. The action had been prompted not by the taxi trade, but the Licensed Private Hire Car Association. Clifford, Chance had, at the end of the previous month, made the concerns of the LPHCA clear to TfL. So Ms Chapman and Emmerson should have known what was coming down the track.

The letter goes through the Uber model, booking process, fare calculation and much more, and in some detail, but the conclusions made can be put directly. These asserted that the law was being broken on a number of counts - nine, in fact, in all. These were:

1 Uber drivers are accepting private hire bookings without operator licences in breach of the 1998 Act.

2 Any Uber driver who does possess an operator’s licence is accepting bookings other than at an operating centre in breach of the 1998 Act.

3 Uber vehicles are equipped with taximeters in breach of the 1998 Act.

4 Uber vehicles are plying for hire without Hackney Carriage vehicle licences in breach of the Metropolitan Public Carriage Act 1869.

5 Uber BV is making provision for the initiation of private hire bookings without an operator’s licence in breach of the 1998 Act.

6 Uber London Limited is likely to be accepting private hire bookings other than at an operating centre in breach of the 1998 Act.

7 Uber London Limited is likely to be failing to keep a record of the prescribed particulars of each journey in breach of the 1998 Act.

8 Uber London Limited is likely to be sub-contracting with unlicensed operators in breach of the 1998 Act.

9 Uber London Limited is likely to be providing unlicensed vehicles and drivers, in breach of the 1998 Act.

The Clifford, Chance letter also notes “Uber has effectively created an unlicensed taxi service, which seeks to enable its drivers to ply for hire on the streets of London whilst avoiding any of the regulation properly applicable to taxis and their drivers”.

There was more: the breaches of the law were “so clear-cut and so serious” that Uber should face immediate sanction. The manner in which Uber had entered the public  transport market in many cities across the world, appearing “to trade regardless of what local law allows, and then to seek to avoid enforcement action” was also noted.

That was what was to happen in London, too. After Steve Burton, TfL’s director for enforcement and on-street operations, had replied to Clifford, Chance confirming that the alleged breaches of the law were being investigated, compliance manager Cliff Llewellyn’s report on that investigation caused the panic button to be hit big time.

Why that should be is not hard to deduce after reading his report. He told that “I have agreed to email them today explaining the main points they need address immediately and we expect a response by Monday 23rd December 2013”. His concerns were:

“Clarification of the legal entity between Uber BV and Uber London Limited … Which company will be making the provision, acceptance and the undertaking of PHV bookings, once point 1 has been addressed … Review of the Uber website to reflect the London legislation … The charging of a fare using a Time x Distance device which is in contravention of the 1998 Act … Review of your sub-contracting processes to reflect that all bookings go through the sub-contractor and not directly to the driver”.

He concludes “There is foundation to this complaint and I would rather they met our licensing conditions via compliance [rather] than enforcement”, but also stresses “If they fail to comply within a reasonable time period, then enforcement action is the only option”.

In other words, Llewellyn was treating Uber as he would any other participant in the London surface public transport marketplace. There were rules in this game, he was there to ensure all players played by them, those rules were there for good reason and for a purpose, and they would be, if necessary, enforced.

The problem he and all those other players in this market faced was that not only did Uber not intend to play by the rules if this did not suit them, they had friends in high places ready and willing to wipe their backsides for them - including in Downing Street.

Uber in California had contacted Priya Guha, then British Consul General in San Francisco, who delegated the matter to vice consul Samantha Evans. Ms Evans described Uber as an “fdi project I am working on”. Foreign Direct Investment.

But the direct investment Uber, and services like it, make in cities like London is minimal. Drivers are self-employed, they source and maintain their own vehicles, and all that Uber provides is an office and access to the app. So why provide what looks very much like special status to a company bringing so little, which appears to be breaking the law?

The answer to that one lies with Daniel Korski and all those in Downing Street who appear to have leaned on TfL to do the bidding of modern-day robber baron Travis Kalanick and his henchmen. They should now explain the mess in which central London’s taxi and private hire market finds itself - the extra congestion, the poor driving standards of Uber drivers (and all the shunts), the increased incidence of assaults and worse, the jacking up of fares without prior notice, and how they got all that fawning press coverage.

Worst of all, those who smoothed the path for Uber need to tell We The People why we should respect the law, when those in power very clearly do not.