Uber’s Kalanick fined $18,000 by local court

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Uber’s Kalanick fined $18,000 by local court

Travis Kalanick, former CEO of Uber, made an abrupt visit to Seoul to stand trial on Friday. The Seoul Central District Court, southern Seoul, slapped him with a 20 million won ($18,000) fine for violating local passenger transport regulations.

Kalanick was initially charged at the end of 2014 but the trial was postponed after he refused to comply with repeated summons, citing personal reasons.

Uber entered Korea in 2013 under a contract with a local rental-car service but faced opposition from taxi drivers who feared losing their share of the market.

The Seoul Metropolitan Government filed a complaint against the American ride-hailing app, saying it illegally operated a passenger service on unauthorized vehicles with its Uber X service.

In December 2014, prosecutors indicted Kalanick, then-Uber CEO, Uber Korea Technology and MK Korea, which provided rental car services with Uber Korea, and the company’s CEO without arrest.

The Passenger Transport Service Act stipulates that no rental car operator shall transport passengers for profit using the automobile or broker such a service in response to the demand of others. Anyone violating the act is subject to up to two years in prison or 20 million in fines at the maximum.

MK Korea and its CEO were each slapped with 2 million won fines in June 2015 and Uber Korea Technology 10 million won in April 2017.

“The plaintiff has been found to be guilty on all of his charges and is fundamentally responsible for the crime, which makes it necessary to hand down a corresponding penalty,” said Judge Kim Dae-gyu in the ruling Friday.

The judge said he took into account the fact that Uber failed to make up for the elements that went against the law in the course of developing and administering a new business model in the mobile age, and the violations in question have been fixed.

Kalanick showed up in court in a suit but refused to answer reporters’ questions. He stepped down as Uber CEO in June 2017 after a scandal about Uber’s work culture as well as a revelation that he visited a hostess bar in Korea. Uber Korea did not come up with an official statement regarding the verdict.

After scrapping the controversial Uber X, Uber currently operates Uber Black, a luxury ride service, and long-distance rental services in Korea. Users can still hail taxis on the Uber app but most Koreans use Kakao T, a Korean app modeled after Uber X.

Uber Korea has yet to give up on the Korean market. It launched UberEATS, a food delivery service app, last August.

The former Uber CEO reportedly bought a controlling stake in a distressed real estate start-up called City Storage Systems for $150 million and seated himself as its chief executive. The company is known to focus on repurposing distressed real estate assets and transforming them into spaces for emerging industries.

BY SEO JI-EUN [seo.jieun@joongang.co.kr]
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