City gov’t ups ante in war with Uber

Social Affairs

Published: 06 Jan. 2015, 21:00

City gov’t ups ante in war with Uber

The dispute between the app-based transportation and taxi service Uber and the Seoul Metropolitan Government appears to be heating up, evidenced by a city government initiative in which anyone who reports Uber taxis from Jan. 2 could receive up to 1 million won ($900).

The international private chauffeur service claims the Seoul government is contradicting its initial stance from 2012, when it declared its support for a collaborative economy, and attempting to promote the use of domestic cabs over the international driving service.

Providing bounties for what has come to be known as the Uparazzi - a portmanteau of Uber and paparazzi - is the latest measure taken by the municipal government to define the service as illegal and curb its employment in the capital city.

Uber drivers or car-rental shops could also face jail time of up to two years or be fined up to 20 million won. The policy is applicable to both Uber X, in which anyone with a driver’s license may work part-time as a chauffeur, and Uber Black, which brokers limo agents and passengers.

But the city government has yet to impose direct restrictions on Uber. By law, car-rental agents and drivers that provide private chauffeur services are illegal, though there are no grounds to punish those who broker private chauffeur services between drivers and passengers.

However, so far the city government’s newest move seems to be taking effect. Some Uber drivers reportedly quit before the measure went into effect, while Uber itself has provided full service only for existing customers in Seoul, restricting access to newcomers.

But despite its caution, the international company - which has already suffered similar setbacks in other countries - seems to have no intention of backing down completely.

Uber said on Friday that the local government’s decision “does not do any good to Seoul citizens” and requested Seoul Mayor Park Won-soon to reconsider. It added that it is still trying to continue its services by any means and is even considering compensating its drivers.

In light of events, the city government has been hit with a barrage of criticism for applying a double standard - supporting similar domestic services but restricting international private chauffeur services.

The local government last year selected Tikle, a carpool application, as the city’s representative sharing-economy service. Tica, a car-sharing application for travelers that was awarded last year by the Ministry of Land, Infrastructure and Transportation, also provides a similar service.

A few observers remain critical about the local government’s policy.

“If the city government starts to apply a double standard to domestic and international companies, we aren’t likely to see global companies growing up in Seoul,” said a founder of an IT company who requested anonymity.

BY PARK SU-RYON, KIM BONG-MOON [bongmoon@joongang.co.kr]