Is This the End of the Road for Uber in London?

(Bloomberg) -- For the second time in two years, London has put a roadblock in front of Uber Technologies Inc. The capital's transit regulator has denied the ride-hailing service a new license to operate in the city, citing concerns over rider safety and the security of the app. Uber managed to get out of a similar scrape last time, but will it do so again?

1. What's the problem?

As it did two years ago, Transport for London said Uber was not “fit and proper” to operate in the city. It's particularly concerned about a vulnerability in the company's app that lets unauthorized users upload their photos to Uber drivers' accounts, giving them the ability to pick up passengers under the guise of being a licensed driver.

2. How big a deal is London for Uber?

London is one of the company's biggest markets in the combined region of Europe, the Middle East and Africa, which is on course to overtake Latin America as the No. 2 region after North America. Uber has 45,000 drivers in the U.K. capital.

3. Are the issues unique to Uber?

TfL says it conducts regular checks on all licensed operators and hasn't found similar issues with any of them. Because Uber is classed as an operator, unlike black cab drivers, it's up against a different set of regulations. Nonetheless, TfL says it found at least 14,000 trips that involved drivers who weren't who the riders thought they were, including some who had revoked licenses. Dismissed and suspended drivers were also able to create an Uber account and carry passengers.

4. Can I still use Uber in London?

Yes, for now. Uber can keep operating as long as it lodges an appeal with a London court in the next 21 days, which it said it will do. As long as an appeal is in process, the company legally has the right to continue normal operations. Uber's U.K. boss, Jamie Heywood, said “we will continue to operate as normal and will do everything we can to work with TfL to resolve this situation.”

5. How long might the appeal take?

When Uber was denied a new license in September 2017, a trial didn't take place until the following June. If Uber were to lose its initial appeal of Monday's decision, it could appeal all the way up to the country's Supreme Court -- a process that could take years.

6. Does TfL's decision affect Uber in other U.K. cities?

The clue is in the name of TfL -- Transport for London. The company will be able to operate outside of London where it has a license.

7. What about Uber Eats?

It's a separate entity. TfL's issue with Uber's app and driver policy won't overlap with the company's food-delivery business, which should be able to continue as normal.

The Reference Shelf

• Bloomberg Intelligence considers the impact.
• Uber helicopter rides cheaper than cars for a while.
• TfL's decision.

To contact the reporter on this story: Nate Lanxon in London at nlanxon@bloomberg.net

To contact the editors responsible for this story: Giles Turner at gturner35@bloomberg.net, Grant Clark, Amy Thomson

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