South Korea to ban taxi services by private drivers in blow to Uber

South Korean lawmakers passed a bill early on Friday to ban taxi services provided by private drivers, marking what is likely the first nationwide legislation to outlaw Uber Technologies Inc’s low-cost uberX service. The ban, which will take effect by the year-end, marks the latest setback for the U.S. company. Though the firm has expanded rapidly and commands a valuation of around $40 billion, its business practice of matching passengers with private drivers without a taxi license has triggered legal and regulatory battles across the globe.

Uber respects this decision by the National Assembly and looks forward to continuing its conversations with Seoul City on how to best serve Seoul and its citizens within the legal framework allowed by Korean Law.

Uber’s company statement

While the legislation, which amends an existing law on transportation services, imposes a blanket ban rather than explicitly mentioning Uber, it was pushed by lawmakers to block uberX. The bill also bans any parties from offering services that match passengers with drivers without a taxi license. The move may be largely symbolic, however, as Uber suspended its uberX service in Seoul in March following a backlash from authorities and taxi unions, and local competitors match riders with taxi drivers only.