Opinion of Advocate General Szpunar on the Star Taxi App case: An electronic application that puts taxi passengers directly in touch with taxi drivers constitutes an Information Society Service

Thanks to Luca Russo for collaborating on this article

On September 10, 2020, Advocate General Szpunar delivered his opinion in case C-62/19 regarding the proceeding between Star Taxi App SRL (“Star Taxi App”), which operates a mobile application that puts taxi passengers directly in touch with taxi drivers (“Service”), and the municipality of Bucharest. This opinion is not binding upon the Court of Justice of the European Union (“CJEU”), which will issue its judgment at a later date.

  1. Background

The relevant Romanian authority fined Star Taxi App for violating Decision No. 626/2017 (“Decision”), which extended the obligation to apply for authorization for “taxi dispatching” (i.e., under Romanian law, is the activity related to the transport by taxi consisting in receiving customer bookings by telephone or other means and forwarding them to a taxi driver via a two-way radio) to operators of information technology applications. Nevertheless, Star Taxi App claimed its service was an Information Society Service (as defined below), and therefore not subject to prior authorization pursuant to Article 4.1 of Directive No. 2000/31/EC. On this basis, Star Taxi App sought annulment of the Decision before the Regional Court of Bucharest, which in turn referred four questions to the CJEU for a preliminary ruling.

The Advocate General has issued his opinion with his considerations on several questions raised during the proceedings.

  1. The first question: Does a service consisting of putting taxi passengers in touch with taxi drivers directly via an electronic application constitute an “Information Society Service”?

The Advocate General clarifies that a service consisting of putting taxi passengers in touch with taxi drivers directly via an electronic application constitutes an Information Society Service when that service is not inherently linked to taxi transport service, so that it does not form an integral part of the taxi transport service.

Indeed, the Service meets all the requirements mentioned in the definition under Article 1.1.b of Directive No. 2015/1535 (which sets forth a procedure for the provision of information in the area of technical regulations and rules on Information Society Services), which states that an Information Society Service is “any service normally provided for remuneration, at a distance, by electronic means and at the individual request of a recipient of services” (“Information Society Service”). In particular, with regard to the Service in question:

  • Taxi drivers who are recipients of the Service pay a fee to Star Taxi App (passengers are recipients as well, but the Service is free of charge for them);
  • It is provided at distance since “the simultaneous presence of the service provider and the recipients” is not required (the simultaneous presence of the driver and the passenger is required to carry out the transport service, but that is a different service);
  • It is provided by individual request originating from both the taxi driver and the passenger; and
  • It is provided via electronic means (e., a mobile app).

According to CJEU case-law,[1] a service meeting the requirements above does not fall under the definition of an Information Society Service if it is inherently linked to the provision of another service, meaning that the provider of the service provided via electronic means controls the essential aspects of the other service, including the selection of the providers of that other service. The latter must be the primary service and must not be provided by electronic means. The Advocate General, however, believes that the Service does not fall under this exception, given that it is an addition to a pre-existing and organized taxi transport service, and thus “Star Taxi App’s role is confined to that of an external provider of an ancillary service, which is important but not essential for the efficiency of the primary service, being the transport service.

  1. The second and third questions: Is European law interpreted as precluding national legislation that makes the Service subject to the same authorization as that imposed upon operators of “taxi dispatching” services provided by other means?

The Advocate General believes that Directive 2000/31/EC does not preclude application to an Information Society Service provider of an authorization scheme applicable to providers of economically equivalent services that are not Information Society Services.

Indeed, although Article 4.1 of Directive No. 2000/31/EC prohibits Member States from requiring prior authorization for Information Society Services, Article 4.2 clarifies that said prohibition does not apply to authorizations that are not specifically and exclusively targeted at Information Society Services, such as the authorization scheme under Romanian Law. However, the evaluation of the economic equivalence between the Service and other taxi dispatching services – and thus the actual applicability of the prohibition under Article 4.1 – should be carried out by the national court.

Furthermore, said authorization must comply with the criteria and principles set forth in Articles 9 and 10 of Directive No. 2006/123/EC regarding services in the internal market (which is fully applicable in this case). The principles under Article 9 require that the authorization scheme not be discriminatory and be justified by an overriding reason relating to the public interest, and that there not be less restrictive measures to achieve the same purpose. Moreover, Article 10 provides conditions for granting authorization. The Advocate General specifies that these criteria are not met when obtaining such authorization is “subject to requirements which are technologically unsuited to the applicant’s intended service” (i.e., requiring an applicant using an electronic application to provide its service to obtain a license to use radio frequencies and related equipment). In any case, the national court should determine whether the authorization complies with the conditions or not.

Lastly, Article 3 of Directive No. 2000/31/EC, Article 16 of Directive No. 2006/123, and Article 56 TFEU, cited in the preliminary questions by the Regional Court of Bucharest, are not applicable to the case under consideration, because the Service is provided in the same Member State where the provider is established.

  1. The fourth question: Does the decision of the relevant Romanian authority constitute a technical regulation requiring prior notification to the European Commission?

The Advocate General notes that the Decision does not establish rules specifically aimed at Information Society Services, meaning that the specific aim and object of the authorization regime is not to regulate the Information Society Service in a specific and targeted manner, and therefore it cannot be regarded as a technical rule requiring prior notification to the European Commission under Article 1.1.f of Directive No. 2015/1535.

[1] CJEU Judgment of December 20, 2017, Asociación Profesional Elite Taxi, C‑434/15, EU:C:2017:981.

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