Uber France Leaders Arrested For Running Illegal Taxi Company

An anonymous reader writes: Two Uber executives were arrested by French authorities for running an illegal taxi company and concealing illegal documents. This is not the first time Uber has run into trouble in France. Recently, taxi drivers started a nation-wide protest, blocking access to Roissy airport and the nation's interior minister issued a ban on UberPop. A statement from an Uber spokesperson to TechCrunch reads: "Our CEO for France and General Manager for Western Europe were invited to a police hearing this afternoon; following this interview, they were taken into custody. We are always available to answer all the questions on our service, and available to the authorities to solve any problem that could come up. Talks are in progress. In the meantime, we keep working in order to make sure that both our customers and drivers are safe following last week’s turmoils."

Comments

Does Uber need executives in France?

[EllisDees]

It's not like they need to have a physical presence for their app to work there.

Re:Does Uber need executives in France?

[Mr D from 63]

They need drivers, and if they can arrest executives, they can likely arrest drivers as well. Interestingly, France has a heavily unionized workforce...so maybe the Uber drivers need to unionize (jk).

And while France may have a legal basis to take those actions, I hate that they give the union protestors, who damaged and disrupted so much, what they wanted. It sends a message for others to follow suit. France is in a pickle.

Re:Does Uber need executives in France?

[cstacy]

they are protecting for the laws that exist that protect them, to be enforced. It's their rights. To be a taxi driver you need a pay a massive license fee, that's how it is. You can't just tell people you're a taxi driver and start making money, there's the insurances and all that, needed. Uber has NONE of it. If anything happens in a "uber taxi", you, your family and friends, essentially eat sh*t. Because not only was your using their illegal, they also don't any have sort of insurance that can protect you.

In the USA? Not quite.

Uber is not a taxi, it's a limo service. Limos are regulated in some (all?) states, but differently than taxis. You can't hail a limo on the street (or airport lane), you have to call them (phone or app) to specifically come to you. Limos don't have "medallions" and are not a limited quantity. The requirements for special driver's license, insurance, and so on, are different than taxis.

Uber provides significant insurance to it's drivers, and it's not "illegal" (at least not in the USA). And they do pay out on claims. Other tort arguments seem unlikely. HOWEVER: When you drive for Uber, your own PERSONAL insurance policy is probably void (most carriers). In fact, if you have EVER used your vehicle for Uber, your insurance is voided -- even if your claim had nothing to do with any Uber trip. If you get hit on the way to the grocery store or injure someone on your way to your day job, your nasty surprise is that you had no valid insurance at that time. Because you once on another occasion used your vehicle for a purpose that totally voids your insurance.

When you call up an insurance company these days to report an accident, the very first words out of their mouth are: "Have you ever used your vehicle for Uber, Lyft, or anything like that?" Because if they find out (and, being insurance investigators, they WILL find out) that the answer is "Yes", then they will inform you that at that time, you voided all your insurance. You Are Fucked.

Re:Does Uber need executives in France?

[Uberbah]

Unions had their place. It's in history now, just like the confederate flag. Unions need to die, they do nothing any longer other than make a few wallets fat (the few running the unions), a TON of people lazy (nearly all union workers), and they disrupt commerce and blah blah blah blah blah

Unions will be needed as long as greedy executives try to exploit labor. Any more concern trolling?

Re:Does Uber need executives in France?

[pr0fessor]

Uber left my state although it's one of the most loosely regulated because they didn't feel they should be required to have more than minimum private liability insurance as apposed to the same commercial insurance that taxis are required to have. Medallions are not required and a commercial license for a taxi driver is about $15 more than a regular driver's license every four years.

Re:Does Uber need executives in France?

[Jesrad]

France has a heavily unionized workforce

Nope. Norway or Italy have heavily unionized workforces, whereas France has the least-unionized workforce (7.7%) in Europe save for Estonia (6.8%).

However, France has some of the richest, most politically influential unions, by a huge margin. To put it simply, unions in France are like parallel political parties, with their own occult sources of funding, high-ranking members inflitrated in every institution, and legal priviledges that protect their position.

But french taxis V.S. Uber is an entirely different, though related, issue.

To make light of the sorry state of Uber in France, you only need to know a few things:
- just a few months ago, Agnès Saal was mediatically ousted from her position as head of the INA for allegedly squandering taxpayers' money on... taxi rides (40 000 euros' worth)
- then a couple weeks ago, we learned that the amount squandered was actually an order of magnitude larger than previously stated - there was simply noway to spend that much on taxis
- also notice that Jean-Jacques Augier, the previous CEO of G7 taxis, the biggest taxi company in France, was the financing director of François Hollande's presidential campaign in 2012
- G7 taxis' current CEO is a close friend of Hollande's Parti Socialiste, and was involved in François Mitterrand's own campaigns too

The intimidation campaign that is raging on against Uber in France is simply how the politicians currently in power are defending some of their illegal sources of funding. The seemingly "out of proportion" violence of this campaign is simply a reminder that, in France, you just don't ask about political parties' or unions' money unless you're ready to die (just like Robert Boulin, Pierre Bérégovoy and judge Pierre Michel died).

Not surprised

[Anonymous Coward]

If taxi drivers have to buy licenses and following certain regulations, shouldn't Uber do the same or are they already?

Re:Not surprised

[crioca]

Alternatively; if Uber drivers don't need to buy licenses and follow certain regulations, why should taxi drivers? It seems like Uber is working well enough under a de-regulated environment.

Re:Not surprised

[Mr D from 63]

Alternatively; if Uber drivers don't need to buy licenses and follow certain regulations, why should taxi drivers? It seems like Uber is working well enough under a de-regulated environment.

Then the very environment that Uber thrives on would be gone. They'd have to adapt as well.

Re:Not surprised

[Rei]

Uber drivers are subsidized by everybody else. Taxi drivers have to pay high insurance rates because the act of driving a long distance every day for a ton of strangers is a job that inherently leads to a much higher statistical rate of payouts. If they're driving as a taxi on regular car insurance, it's you that's paying the bill for their swindle of the insurance system.

Re:Not surprised

[Mashiki]

Protectionist laws like requiring a chauffeurs license? Having appropriate carrier insurance? Following the same rules that actual taxi companies have to? Holy fuck! It's like people want them to operate like a legal business or something!

Re: Not surprised

[Bartles]

Oh no, the horror. Someone trying to sell something has to adapt to better serve their customers. I liked the protectionist middleman system so much more.

Re:Not surprised

[mysidia]

No... protectionlist laws, like requiring a permit and then limiting the number of outstanding permits to a small fraction of those who want to be in the business, for the sole purpose of restricting supply to be less than what the public needs.

Re: Not surprised

[davester666]

Stupid. Read up on something called "history". We already tried what Uber is doing, only without the "over the internet" part. It didn't work out so well.

It is precisely why the taxi industry is like it is now.

Taxi licenses are crazy expensive

[MouseR]

In Quebec, it costs upwards of 200,000$ CDN to have a taxi license.

Drivers spent their entire life's saving enough to buy their own license while they lease another one's. It's their only retirement plan: lease a license they earned to buy.

No wonder they're pissed.

Re:Taxi licenses are crazy expensive

[pecosdave]

It's their own fucking faults. They lobby to make sure this is the system that's in place to prevent competition from companies like Uber. They got the laws they paid for, it's the people who bought the first wave of licenses/medallions whatever that made bank, now everyone else has to deal with it.

An upstart breaking that system is exactly what real business needs.

Re:Taxi licenses are crazy expensive

[Noah Haders]

I would have the slightest shred of sympathy if taxi unions hadn't used their protectionist racket to provide the nastiest most unpleasant rider experience. If taxi companies were really good at providing good service and uber came in with some sort of unlicensed fly by night business, then it would be clear. But even if uber were the same price as cabs, I would choose uber every_single_time. Maybe cabbies should think on why that is, and try to make an experience that is good for the customer so they win their business, rather than focusing on their entitlements and how they should be able to shut everybody else out of the market.

Re:Taxi licenses are crazy expensive

[MoaDweeb]

New Zealand liberalised its taxi system about 25+ years ago. The Gov't allowed anyone to setup a taxi company who had the appropriate car licence endorsement, log books and passed a vetting process for its drivers. etc.

Uber have shown up and decided that they do not have to have vetted drivers, log books etc. 'cos they are Uber!
The Police are investigating.

The barriers for entering the NZ market are quite low but even then Uber do not think they should apply to them.

Re:Taxi licenses are crazy expensive

[quantaman]

It's their own fucking faults. They lobby to make sure this is the system that's in place to prevent competition from companies like Uber. They got the laws they paid for, it's the people who bought the first wave of licenses/medallions whatever that made bank, now everyone else has to deal with it.

An upstart breaking that system is exactly what real business needs.

Medallion owners bought the medallions with the understanding that they were buying into a limited monopoly.

I'm not opposed to changing this agreement, in fact I encourage it, but if you're going to do so you need to compensate who bought the medallions.

Re:Taxi licenses are crazy expensive

[jklovanc]

This assumes that all the laws regarding licensed taxis were instigated by taxi owners. That is patently not true. Many of the regulations were created in response to problems caused by unlicensed taxis. Here are some of the regulations that cost licensed taxis money.
- Minimum number of cars on the road/company.
- ratio of handicap accessible taxis.
- standards of cleanliness.
- language standards
- anti-discrimination
- driving record checks
- criminal record checks
  - frequent vehicle inspections
- professional driver's licenses

While it is not perfect there is a mechanism to pull bad taxis off the read. Without being able to pull a license that mechanism is gone.

The reason there is a limit on competition is to create an environment where owners can make a living and still follow the regulations imposed on them.

An upstart breaking that system means going back to the bad days when taxis were unregulated.

Re:Taxi licenses are crazy expensive

[Anonymous Coward]

>Medallion owners bought the medallions with the understanding that they were buying into a limited monopoly.
Shit happens!

>need to compensate who bought the medallions
Nope! My shares went down in the last crash, noone compensated me!

Re:Taxi licenses are crazy expensive

[idji]

Uber has to do these checks anyway before they are allowed to take the drivers.
The "bad days" of unregulation were long before the digital age - we have better ways of checking these people now, including star ratings within the Uber app - if the driver doesn't have 5 stars, just reject them.
The goal shouldn't be so that taxi drivers can make a living, but rather that people can get from A to B how they want.
The fight here is about cronyism, protectionism and the scam of making taxi drivers pay $200,000 blood money to be able to drive in Quebec, Melbourne, etc. I have talked to taxi drivers in Melbourne who hope that they can sell their license when they retire so that they can retire.

Re:Taxi licenses are crazy expensive

[140Mandak262Jamuna]

According to TPP pushed by Obama and supported by GOP, if foreign company invested in these medallions and they lose value because of some change in the law/regulation they can sue the federal government for compensation. This bail out is not available for domestic investors. Only foreign investors can do this. And only the foreign investor has the standing to sue, not unions, not labor activists, not local governments. And they will be judged by fellow lawyers who could be representing other parties at the same time.

Re:Taxi licenses are crazy expensive

[jklovanc]

Uber has to do these checks anyway before they are allowed to take the drivers.

Not all and they could drop them at any time.

The goal shouldn't be so that taxi drivers can make a living, but rather that people can get from A to B how they want.

Right now Uber is a new thing and many people are interested in it. Wait a few years when licensed taxis are out of business and there are no taxis on the road when you need them. Wait till there are few if any handicap accessible vehicles and few will pick up certain minorities. The problem with star ratings is that they can be misused. Give every "insert minority here" a negative rating and see what happens.

Re:Taxi licenses are crazy expensive

[Rockoon]

Medallion owners bought the medallions with the understanding that they were buying into a limited monopoly.

..and I bought stock in oil reserves with the understanding that I was buying into a limited monopoly. Then Saudi Arabia started dumping oil on the market. Should the government make me whole again, too?

It seems that you are the victim of a common misconception: That the State is the one selling the medallions that cost so much. Wrong, ignorant fuck.

Re:Taxi licenses are crazy expensive

[pecosdave]

Why?

Compensate them because their government backed monopoly in which they prevented hundreds if not thousands of others from profiting because they worked the system in such a way that guaranteed the laws of supply and demand didn't affect their business? They're lucky there isn't a lynch mob coming after them for the affront to the natural market, losing a protected monopoly is no reason to reward them.

Re:Taxi licenses are crazy expensive

[PopeRatzo]

Medallion owners bought the medallions with the understanding that they were buying into a limited monopoly.

Maybe it should be clarified here that when you see someone claim that it's not the government charging $200,000 for a taxi medallion, that's just the going price on the secondary market. You know, good old capitalism, where people are bidding up the price of a necessarily limited commodity.

The taxi authority looks at population, traffic flow and transportation needs and comes up with a number of taxis that they think should be on the street. Every year, they add new medallions into the system, usually with a lottery. The idea is not so much to protect the cab drivers (cities don't care about cab drivers. If they did, they wouldn't make the minor traffic fines, like your cab being 10 inches over the line of a designated taxi waiting zone, as much as $500 (which practically wipes out the cab driver's week), but to keep the number of taxis from getting so crazy that you have cabs clogging up city centers, fighting for fares.

Another think medallions are used for is to ensure that someone in an underserved part of the city can get a cab. In my city, certain medallions are required for certain times to initiate or terminate a certain percentage of fares in certain parts of the city.

Re:Taxi licenses are crazy expensive

[drinkypoo]

- Minimum number of cars on the road/company.

A problem that solves itself if you permit anyone to perform as a taxi.

- ratio of handicap accessible taxis.

That actually seems useful. Could better be served by handicapped-specific public mobility services, however.

- standards of cleanliness.

That must be nice. No taxi I've ever been in has been clean. Some have been not too nasty.

- anti-discrimination

False everywhere in the world.

- driving record checks
- criminal record checks

Basically worthless

- frequent vehicle inspections

Everyone should have these based on mileage

- professional driver's licenses

A scam to produce revenues

Re:Taxi licenses are crazy expensive

[chihowa]

WTF have your shares got to do with your desire to deliberately trash the life savings of millions of taxi drivers in the western world?. They entered into a contract with the government...

Typically, taxi medallions aren't sold by the government anymore. They're typically sold by their previous holders and the high prices reflect their scarcity and perceived value. The market decides this value (even when they're auctioned off by the state), so there isn't any guarantee that they'll maintain that value. Any contracts that exist say nothing about limiting the supply or compensating medallion-holders for any speculative prices they paid. Buying a medallion for $800k is just as speculative as buying an $800k house or $800k worth of stock. There are no government guarantees that they will maintain value.

tl;dr... The economics of the taxi medallion situation are extremely similar to shares in a company. The "contracts" that you're referring to don't exist (at least in the form that you image).

Re:Taxi licenses are crazy expensive

[BradMajors]

According to TPP pushed by Obama and supported by GOP

BTW, Obama is a Democrat.

Re: Taxi licenses are crazy expensive

[Rakarra]

Damn statists expecting laws to be obeyed! The nerve!

A law needs to be justified to be respected. "The law is the law" is not an argument for that respect.

Re:Taxi licenses are crazy expensive

[KGIII]

The star rating system. You mean like /.'s moderation system? Yeah. That is effective. An obscene proportion of my posts get modded up. I know I did not say that many witty, insightful, informational, or otherwise beneficial posts.

Uber has demonstrated contempt for the law

[rahvin112]

Regardless of whether the laws as written are correct (I would argue that the very existence of a "medallion" that costs more than the filing fee is evidence of collusion between the taxi authority and the taxi's) Uber has shown direct contempt for the rule of law. Their CEO's frequently ignore court orders, not only that but they frequently do the exact opposite of what a court has ordered. In Korea the authorities were forced to start fining drivers record amounts, in Germany the authorities had to threaten to seize cars and fines in excess of $25K. None of this should be necessary as Uber should have shut down their platform in the area when the courts ruled against the legality of their service. If they didn't like the ruling they should have complied while challenging the ruling.

I've said all along the only way to get Uber to comply with the law is stop arresting drivers and start arresting executives for facilitating breaking the law. I'm happy to see the French are finally going to follow through at least partly, I doubt targeting these executives will do the trick the Uber corporate executives will simply let them burn, though the seizure of communications may give them the evidence they need to really get the law breaking to stop, that is to issue InterPOL red notices (warrants) for the CEO and heads of Uber corporate. I firmly believe that Uber acts in total disregard of the law because of their CEO and that the only way to get it to stop is directly go after that CEO. Once he's looking at a jail term I suspect Uber will suddenly become a law abiding business.

IMO Uber acts as a corrupt organization with contempt of the law and should be targeted under RICO statutes.

Re:Taxi driver is a crap job

[DahGhostfacedFiddlah]

Why?

Re:French citizens should be looking at Greece

[mjwx]

I dont understand France or Greece

There, fixed that for you.

Greece is in it's predicament because of it's endemic corruption. Tax evasion isn't just a national past time in Greece, it's considered an inalienable right. France does not have this problem.

I know you're trolling

[rsilvergun]

Or at least I hope you are, and you're not just a paid shill/astroturfer (you're a bit too crude for that), but you've also never had a mini-gun pointed at him by private "security" personal because you asked for better pay. You've never had terrorists come in the night and cut your families throats for the same thing (google "Coca-Cola South America" sometime). You have no bloody idea what the hell your talking about. If you did you probably wouldn't be trolling it and you'd go back to goatse and Natalie Portman Hot Grits.

Re:I know you're trolling

[OhPlz]

In this story, which group of people were pulling drivers out of cars and beating them, damaging those cars, holding passengers hostage in the terminals, and lighting tire fires trying to block the entrances to the airport? The parent has a point. They do disrupt commerce and trade. The unions have now taken on the role of mercenary instead of the companies. I don't blame customers for not wanting to get into those vehicles, and prefer something like Uber instead. Do you want to get into a car with your family with a violent lunatic behind the wheel? I don't even like what Uber is doing, but this incident is insane. You challenge stuff like this in the courts, you don't take the law into your own hands and go vigilante like that.

Re:Uber this!

[pete6677]

France can always be counted on to do things in the least logical way possible.

Re:French citizens should be looking at Greece

[Anonymous Coward]

What part about "unregulated" did you fail to understand?

Pure capitalism can't work. If there weren't customer protection laws, corporations would get away with food that poisons you and it's your own fault for not reading the poison sign, devices that fall apart after a week so you need to buy a new one to increase profits, produced by workers in just bearable enough conditions so they don't die after a week, to maximize their workforce.

Pure capitalism is pure darwinism, something a civilized society should not embrace under any circumstance.

What do you think a law is that says food must not be poisonous? A law that mandates manufacturer warranties? Minimum wage? Union rights? Could it be STATE REGULATION? Why do you think those laws need to exist in the first place? q.e.d.

Re:French citizens should be looking at Greece

[complete loony]

Er, no. Greece is in trouble because the Euro doesn't give them any way to handle a crisis. The failure of the euro wasn't just predictable, it was predicted.

Uber is illegal in France

[HuguesT]

Uber operates outside the bounds of the law in France. This is well documented. There are two sets of law that they do not obey. The first is one regulating car drivers that are not taxis. It is legal in France to operate a car service to drive people from A to B but you need to abide by some restrictions. The car cannot be hailed, only booked. The driver must have some qualification, etc. Uber does not abide by these laws. The second set of law protects the consumer. In particular, data must be viewable and deletable by the consumer, and they cannot be retained indefinitely. Again Uber does not follow the law.

Recently the french equivalent to state department pointed out to Uber that they needed to change some things, so what did they do? They opened service in 5 new cities with no change. This was seen as provocation, and so obviously the top executives were brought in for questioning. The french cannot state on the one hand that something is illegal and on the other let it happen. They had to act.

Now maybe the law needs to change, this is an important debate. In the meantime in a law-based country the law needs to be upheld.

Re:Uber this!

[Anonymous Coward]

Which is damn nice in todays worls where CEOs are usually intouchable. It's good to know in some countries they can still be held personally responsible if they do something illegal.

Re:Flagrantly anti-consumer

[dave420]

You say "let's be honest", then make up some fantasy which doesn't apply to "most countries". Maybe to yours, but not to "most countries". In Germany all the taxis I've taken have been spotless, driven by polite drivers (except one, who briefly complained about having to break a 50), are well maintained, and usually a new(-ish) Mercedes. They turn up when called, or are available to flag down on the street. Germany doesn't want Uber as the taxi service here works well.

Re:Uber this!

[gnasher719]

France can always be counted on to do things in the least logical way possible.

In which alternate universe is arresting the people running an illegal business the "least logical way possible"?

Re:Uber this!

[BlueStrat]

France can always be counted on to do things in the least logical way possible.

In which alternate universe is arresting the people running an illegal business the "least logical way possible"?

The fact that it's illegal for a private person to accept payment for a car ride principally to protect politically-connected businesses practicing an outdated/obsolete business model is both corrupt and illogical. It's protectionist crony-capitalism. Rather than logically correcting such a corrupt system, they doubled down on it. Just because a government declares something "illegal" does not mean it is morally and/or ethically wrong, or a detriment to society and/or the economy.

Strat

Re:Uber this!

[NotDrWho]

France can always be counted on to do things in the least logical way possible.

A bunch of taxi drivers start rioting in the streets, blocking traffic, and burning cars. France's response? Arrest the people they're protesting AGAINST.

Is it any wonder they keep getting invaded, or that the only decent tactician if the history of their country was from Corsica?