Uber’s bid to take over British private hire tech firm Autocab will be investigated by competition watchdog
- CMA will examine if deal could result in a ‘substantial lessening of competition’
- Manchester-based Autocab provides private hire taxi operators across world
- Uber pledged to keep Autocab independent with its own staff and management
Uber’s bid to take over British private hire tech firm Autocab is to be investigated by the competition watchdog.
The Competition and Markets Authority (CMA) will examine whether the deal could result in a ‘substantial lessening of competition’ in the UK taxi market.
It comes after London cabbies came forward with plans to sue Uber for millions after accusing the firm of breaching private hire rules last week.
Manchester-based Autocab provides private hire taxi operators across the world with software to run their business.
Uber’s bid to take over British private hire tech firm Autocab is to be investigated by the competition watchdog
Ride-hailing giant Uber said in August that it had reached an agreement to acquire the company, saying the move would help it connect passengers with local drivers in areas it does not serve.
These locations include Oxford (an average of 67,000 app opens per month), Doncaster (24,000), Swansea (18,000) and Aberdeen (17,000).
As part of the deal, Uber pledged to keep Autocab independent, with its own staff and management.
The watchdog said: ‘The CMA is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.’
The CMA is seeking comment from the industry until February 12.
An Uber spokeswoman said: ‘We are co-operating fully with the UK Competition and Markets Authority’s inquiry to ensure it can conclude its review as quickly as possible.
‘We are confident that this acquisition is positive for consumers, will help local operators grow and provide drivers with genuine earning opportunities.’
Last week it was revealed legal action brought on behalf of thousands of black taxi drivers will allege that Uber allowed its drivers to accept bookings directly rather than through its central system.
Legal action brought on behalf of thousands of black taxi drivers will allege that Uber allowed its drivers to accept bookings directly rather than through its central system (file photo)
The cabbies claim this ‘unlawful breach’ between June 2012 and March 2018 undercut them and resulted in a loss of earnings.
Litigation specialist RGL Management, which is building the lawsuit with Mishcon de Reya, believes 30,000 drivers could be entitled to damages – and that full-time drivers could be in line for £25,000 each.
Around 4,000 black taxi drivers have already added their name to the claim, while another 5,000 were being processed, meaning victory could cost Uber millions.
But the ride-hailing firm dismissed the allegations as ‘completely unfounded’ and said it operates lawfully in the capital.
London cabbies are planning to sue Uber for millions after accusing the firm of breaching private hire rules (file photo)
An Uber spokeswoman said: ‘Uber operates lawfully in London and these allegations are completely unfounded.
‘We are proud to serve this great global city and the 45,000 drivers in London who rely on the app for earnings opportunities, and are committed to helping people move safely.’
The claim has not yet been issued and Uber sources said Mischon de Reya has been threatening such action for years but never followed through.
Uber found itself in court last year when it appealed a decision by TfL to strip it of its licence following accusations it posed a risk to passenger safety.
A judge in September overturned the ban and granted the firm an 18-month extension to operate.