The Legal Implications of Sharing Economy Models: A Deeper Look into Uber’s Impact on Competition...
Transcript of The Legal Implications of Sharing Economy Models: A Deeper Look into Uber’s Impact on Competition...
THE LEGAL IMPLICATIONS OF SHARING ECONOMY MODELS:
3 May 2016 Christopher S. Hill
A deeper look into Uber’s impact on competition and other legal issues
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What is Uber?
• Foundedin2009inSanFranciscoas“UberCab,”goingliveinSanFranciscoinJuly2010
• Uberconnectsriderstodriversthroughanapponsmartdevices
• UberrampsupnationalexpansioninMay2011,expandingtoNewYorkCity,andexpandingintoanewcityeachmonth,includingChicagoandWashingtonDC.
• InDecember,2011,ParisistheLirstcityoutsideoftheU.S.whereUber’sservicebeganoperating
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WhatisUber?
• AsofFebruary1,theserviceisavailablein68countriesand400citiesworldwide.
• 2015estimatedworth:$50Billion
• 2015estimatedrevenue:$10Billion
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• SmartphoneApp
• TechCompany
• RideshareFacilitator
• JointVenturewithTransportationProviders
• TransportationCompany• EmployerofTransportationServices
WhatisUber?
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Thesharingeconomy...allowsindividualstoshareproductsandserviceslikeofferinghomesandapartmentsforrent,ordrivingpassengerstodestinations.Thesmalltasksoftenarebrokeredthroughmobilesmartphoneapps,andtheplatformsconnectfreelancerswithavailableshort-termgigs.
Sometimescalled:• Peer-to-peernetworks• Collaborativeeconomy• Accesseconomy• On-demandeconomy• Gigeconomy
Describesatypeofbusinessbuiltonthesharingofresources—allowingcustomerstoaccessgoodswhenneeded.
What is the Sharing Economy?
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SnapGoodsHigh-endhouseholditems,e.g.,cameras,kitchenware,musicalinstrumentsAirbnbPrivateroomsorhomes/apartmentsDogVacay
PetBoardingRelayRidesCarRental–Borrowcarsfromneighbors
TaskRabbitHirepeopleforjobsandtasks,includinghandymen,delivery,andofLicehelp
GetaroundPeer-to-peercarsharing
Liquid(Spinlister)Bike,surf,andsnowgearrental
ZaarlyPeer-to-peermarketplaceforpeopletoprovideservicesforothers,e.g.,iPhonerepair,homerepair,homemadecooking
Other Share Economy Companies
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LyftUbercompetitor–ridesharing
BlablacarAnotherridesharingcompany
WeWorkSharedofLicespaces–ondemandworkspaces
InstacartGroceryservices
LendingClubPeer-to-peerlendingandinvesting
FonWi-Linetworksharing
PoshmarkClothingandfashion
NeighborgoodsSharinghouseholditems,likelawnmowers,ladders,etc.
SideCarRideSharing
Other Share Economy Companies
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Legal and Business Concerns Raised Regarding Uber
• Unregulated– Unfaircompetitionfortaxisandothersthatareheavilyregulated– Ubercounter–industry-controlledregulatorsimpedeUber
• Slicingpricestocornerthemarket– Unfaircompetitionfortaxisandcompetitors
• Labor/EmploymentLaw– EmployeesorIndependentContractors– Outofpocketexpensesfordrivers,tipsgotoUber,etc.
• Publicsafety• Health,safety,fraud,unskilledserviceproviders• AmericanswithDisabilitiesAct
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Labor Issues
O’Connoretalv.UberTechnologies,Inc.C.A.No.13-03826-EMC(N.D.Cal.)
JuryTrialScheduledJune20,2016
ClassCerJficaJonAppealpendinginJune
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Labor Issues
• WinningtheBattlevs.LosingtheWar
• ImpactofDriverlessCars
• WhatdoesthatdototheUberModel?
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Antitrust Issues
Missouri Lawsuit Allegations By Uber:
1. St.LouisMetropolitanTaxicabCommissionrequiresexcessive licensingrequirements
2. MTCiscontrolledbymarketparticipants
3. MTCcolludestostiLlecompetition
Wallenv.St.LouisMetropolitanTaxicabCommissionCase:4:15-cv-01432(E.D.Mo.)(9/18/15),Motionstodismissbriefed;Rulingspending
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European Collaborative Economy Industry Open letter to The Netherlands Presidency of the Council of the European Union
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European Collaborative Economy Industry Open letter to The Netherlands Presidency of the Council of the European Union
LawNo.2014-1104ofOctober1,2014• (1)prohibitionagainstchauffeuredvehiclesotherthantaxischarginga
per-kilometerfee;• (2)prohibitionon“electronicroaming”bychauffeuredvehicles,i.e.,
theuseofasmartphoneapplicationthatshowsthelocationofnearbyavailablevehiclestopotentialcustomersinreal-time;and
• (3)aftereachride,chauffeuredvehiclesreturntotheirhomebaseorstopinaplacewheretheyareauthorizedtopark.
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Thévenoud Law
FRANCE
• UberFranceandUberBVsuedbytheUnionNationaledesTaxis,ataxitradeassociation,andthreetraditionalprofessionalchauffeurservices.
• UberrequestedthatconstitutionalchallengestothreemajorprovisionsoftheThévenoudLawbereferredtotheConseilconstitutionnel(ConstitutionalCouncil),theFrenchbodytaskedwithverifyingtheconstitutionalityoflaws.
• TheCourdecassation,whichactsasagatekeeperforthistypeofconstitutionalchallenges,accepted,intwoseparatedecisions,thereferralofUber’schallengestotheConseilconstitutionnel.
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Thévenoud Law
FRANCE
Conseilconstitutionneldecision:May22,2015(1) prohibitionagainstchauffeuredvehiclesotherthantaxischarginga
per-kilometerfee;
• prohibitingchauffeuredvehiclesfromchargingcustomersonthebasisofdistancewhileauthorizinglicensedtaxistodoso,unjustiLiablyviolatedfreedomofenterprise,whichtheConseilconstitutionnelderivesfromaclauseofthe1789DeclarationoftheRightsofManstatingthat“[l]ibertyconsistsinbeingabletodoanythingthatdoesnotharmothers.”
FRANCE
Conseilconstitutionneldecision:May22,2015(2)prohibitionon“electronicroaming”bychauffeuredvehicles,i.e.,theuseofasmartphoneapplicationthatshowsthelocationofnearbyavailablevehiclestopotentialcustomersinreal-time;and(3)aftereachride,chauffeuredvehiclesreturntotheirhomebaseorstopinaplacewheretheyareauthorizedtopark.
• TheConseilconstitutionnelfoundtheothertwoprovisionstobeconstitutional,however,deemingthemtobejustiLiedbythegovernmentalinterestinpreservingpublicorder,particularlywithregardtotheuseofpublicroadwaysandparkingplaces.
FRANCE
digitalserviceprovider,calledan“informationsocietyservice”intheapplicableEUdirective• regulatedbytheEUandbeneLitfromthefreedomofestablishmentforserviceproviders
andthefreemovementofservicesasprovidedforintheServicesDirective2006/123/ECandtheTFEU
• “Informationsocietyservices”aredeLinedas“anyservicesnormallyprovidedforremuneration,atadistance,bymeansofelectronicequipmentfortheprocessing(includingdigitalcompression)andstorageofdata,andattheindividualrequestofarecipientofaservice.”(Id.art.2(a).)
transportoperator• transportoperationisregulatedbytheEUMemberStates.(ServicesDirective,recital
21.)
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EU Classifications:
SPAIN
• EuropeanUnion(EU)islessclear.TheservicecaneitherbequaliLiedasadigitalserviceprovider,calledan“informationsocietyservice”intheapplicableEUdirective,orasatransportoperator.InformationsocietyservicesareregulatedbytheEUandbeneLitfromthefreedomofestablishmentforserviceprovidersandthefreemovementofservicesasprovidedforintheServicesDirective2006/123/ECandtheTFEU,whereastransportoperationisregulatedbytheEUMemberStates.(ServicesDirective,recital21.)“Informationsocietyservices”aredeLinedas“anyservicesnormallyprovidedforremuneration,atadistance,bymeansofelectronicequipmentfortheprocessing(includingdigitalcompression)andstorageofdata,andattheindividualrequestofarecipientofaservice.”(Id.art.2(a).)
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EU Classifications:
SPAIN
1. IftheservicesUberprovidescanbequaliLiedasmerelyatransportserviceorifitmustbeconsideredtobeanelectronicintermediaryserviceoraninformationsocietyservice?
2. IfUber’sservicescanbequaliLiedas“informationsocietyservices,”shoulditbeneLitfromthefreedomtoprovideservicesguaranteedbyArticle56TFEUandtheServicesDirective2006/123/ECandtheE-CommerceDirective2000/31/EC?
3. IsUber’sallegedbreachofSpain’sunfaircompetitionlawcontrarytoArticle9oftheServicesDirective,whichgoverns“authorizationschemes”andwhichstatesthatanauthorization,licensingorpermitsregimecannotberestrictiveordisproportionate,andcannotunreasonablyhindertheprincipleoffreedomofestablishment?
4. IfUberistobeconsideredasaninformationsocietyservice,aretherestrictionsSpainiscurrentlyimposingonUberallowed,takingintoaccountthefreedomtoprovideinformationsocietyservicesexpressedbyArticle3oftheE-CommerceDirective?
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Certified Questions
SPAIN
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"IfParisianswanttorentouttheirhomewhentheygoonholiday,thatisnotreallyaproblem.Whatconcernsusiswhensomeonepurchasesoneormorepropertieswiththeaimtoturnthemintotouristrentals.Wedon'thaveenoughpropertiestohouseParisians.“IanBrossat,Paris'deputymayorinchargeofhousing.
France
AIRBNB
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InFrance,homeownersarefreetorentouttheirprimaryresidenceforuptofourmonthsperyear.ButunderaParisianlawenactedin2011,peoplewhowanttorentoutaninvestmentpropertymustownanequivalentpropertywithalong-termtenant.Finesforbreakingtherulecanexceed$28,000.
France
AIRBNB
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"Around83%ofourlistingsinParisaremainresidences,sothiscrackdowndoesnotreallyconcernus"
AirbnbFrancespokeswomanPhilippineNouveau.
France
AIRBNB
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• Lawpassedin2014requiringallshort-termvacationrentalstoberegisteredwithauthorities,withone-timefeestoregisterthepropertythatcanrunhigherthan$250.
• Berlingovernmentsaystheruledoesn'trestrictthesharingeconomyandaffectsonlypeoplewhorentoutinvestmentproperties.
• "Theaimofthelawistoturnholidayapartmentsintoregularhousingtoalleviatethehousingshortage,especiallyinpopulardistricts."
TorstenKuehne,districtcouncilorforPrenzlauerBerg
Berlin
AIRBNB
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Over-regulatingroomsharingdoesn'taddresstheunderlyingproblem—ashortageofhousing—thathaspromptedcriticismoftheindustry.IfcitieslikeBerlinwouldbuildmorehousing,peoplewouldbelessinclinedtocriticizeAirbnbandotherroom-sharingservices.
AirbnbspokesmanPeterHuntingford
Berlin
AIRBNB
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Berlininspectorsregularlycheckroom-sharingsitestomakesurenooneisviolatingtherule.Residentsareeagertohelp.IntheLirstsevenmonthsaftertheban'sintroduction,neighborsnotiLiedauthoritiesofabout700potentiallyillegalrentals,Kuehnesaid.
Enforcement
AIRBNB
THE LEGAL IMPLICATIONS OF SHARING ECONOMY MODELS:
3 May 2016 Christopher S. Hill
A deeper look into Uber’s impact on competition and other legal issues