Disruptive Legislation: France re-examines taxi law amid Uber's rise

By MoneyTimes

Jul 28, 2015 07:37 AM EDT

France is rethinking its taxi laws with the rising demand for Uber and other online ride-hailing services.

France's Economy Minister Emmanuel Macron says key players are meeting next month to re-examine the industry's economic model.

"We will find a new set of regulations that will take into account the new dynamics of the sector," Macron told Reuters during a function for startup companies.

This comes nearly a year after France passed a new law regulating the taxi industry. That law is being questioned by Uber in court, saying it limits its use of a localization software.

With its mobile apps, Uber enables people to get a ride from private individuals at prices lower than traditional.

Threatened by Uber, traditional cab drivers launched protests, saying unlike them Uber's drivers did not have to pay licenses or tax.

Following protests, Uber suspended its UberPOP-sharing service earlier this month.

Uber wants to be allowed to compete with incumbent taxi and limousine drivers, noting its service redounds to the benefit of consumers.

This matter will be discussed in next month's meeting, according to Macron. The minister said taxis and car-sharing services did not have to drive each other out of business.

"You created a new service, which has created a new demand," he said to the CEO of Hitch, a France-based ride-sharing app service.

Uber is facing government opposition in several other countries, including Belgium, Germany, Spain, the Netherlands, and Australia.

In California, the ride-sharing company is facing a class action suit for treating its drivers as contractors, not employees, which frees itself from having to pay for insurance, overtime, and taxes.

Despite these challenges, Uber continues to grow.

In China, where its offices were raided and equipment seized, it recently hit one million rides a day. At this rate, Uber expects China to be its largest market soon.

Uber drew global prominence last December after one of its drivers in India was charged with rape. The company was banned for a time in the city of Delhi, but now it is adding seven more Indian cities to its operations.

Uber now offers services in 56 countries. And while it is now worth $50 billion, it has no plans yet of going public via an IPO.

"Our focus is right now on just providing as good a service as we can to as many people around the world," David Plouffe, Uber's top strategy man and board member, told ABC News.

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