Spain: City Council of Madrid denounces “free trips” scheme by Uber and Cabify

Madrid’s City Council has asked markets regulator CNMC to carry out a review on the offer of free trips presented by online ride-sharing companies (known in Spain as VTCs) Cabify and Uber on September 26, to determine whether this violates competition laws by offering services at a loss in order to attract more users away from their competitors. The City Council indicated that the offer “could violate certain articles of Law 3/1991, from January 10, of Unfair Competition…”

The initiative involves attracting travelers “through unfair competition practices” to divert customers from a market agent, developed by the City Council. They noted that fares in the taxi sector are set by the administrations, as well as highlighting the common characteristics between taxi drivers and private hired cars, which makes them compete “directly” in door-to-door trips.

The Government will approve a Royal Decree Law that will empower autonomous communities to regulate the activity of ride-sharing services in their respective territories, with a possible implementation of second licenses to maintain a proportion of 1/30 (one VTC for every 30 taxis), whose average proportion is currently 1/6 in Spain.

Full Content: El Confidencial