Uber Calls for Emergency Decree as It Faces Exit From Colombia

(Bloomberg) -- Uber Technologies Inc. is calling on the Colombian government to enact emergency regulations to allow it to keep its ride-hailing service operating after a local regulator ruled the company wasn’t competing fairly.

Uber is asking President Ivan Duque’s administration to put in place an emergency decree to set temporary rules for ride-hailing services, said Justin Kintz, the company’s vice president for global public policy. If not, the company will end its service as of Feb. 1, making Colombia the first Latin American country that has forced it to leave.

“Almost every other country in Latin America and nearly every country around the world that has encountered Uber has figured out a way to set rules and regulations to govern our service. Colombia stayed behind,” Kintz said by phone from Davos, where he is attending the World Economic Forum to speak about government regulations for ride-hailing services.

The president’s office and transportation ministry declined to comment, but Transportation Minister Angela Maria Orozco told W Radio Monday that this “country does not legislate for any particular company.” The government has said it will have legislation ready by March to regulate such services, but Uber will have stopped service by then, Kintz said.

The San Francisco-based company encountered stiff resistance from taxi drivers ever since it chose Bogota as its first South American operation in 2013. The company paid about $40 million in taxes over the years, hired nearly 90,000 drivers, and provided service to about 2 million riders. But the government never passed laws to regulate it. A taxi service sued the company for violating competition norms, and in December a judge at the local market regulator ruled against Uber.

Political Influence

“We want to continue operating as normal, but right now we’re in the process of shutting down to comply with the order,” Kintz said, adding that the food-delivery business, Uber Eats, is not affected. The company may consider re-establishing its ride-hailing business if regulations are put in place in the future, he said. “We’ll have to wait and see.”

The service was widely embraced in Colombia by residents who feared hailing cabs on the streets due to crimes and kidnappings. Politically influential owners of taxi companies took aim at the company, Kintz said.

“Despite the fact that we chose Bogota to be our first operation in South America, it has been a really troubled relationship from a political standpoint because we received so much heavy opposition from local taxi owners,” he said.

As the relationship soured, Uber scrapped plans to build a $40 million center of excellence in Colombia last year. That center and plans to introduce new products, such as self-driving cars, are now being shifted to neighboring countries, he said.

Uber has asked the Colombian government for years to regulate ride-hailing companies, even offering to create a fund that would support displaced taxi drivers, Kintz said.

“We’ve talked to anyone who would listen to us, in the president’s office, the president himself, with congress,” he said. “They say the right things, that they want this kind of investment and that they want to figure out a path forward. But nothing really ever materializes. It’s like watching the same show on repeat year after year after year.”

The country risks damaging its reputation with other investors, just as Duque promotes the “orange economy,” an idea to encourage the creative and technology sectors. Uber’s competitors, including Chinese company Didi Chuxing and Beat, will continue operating for now.

“Uber is definitely the best-known brand and it’s the most widely used and so I think for the local competitors who wanted us out of the market, they started with us first,” he said. “I’m sure eventually once we leave, they’ll turn their focus to competitors like Didi and Beat and probably try to do the same thing.”

To contact the reporter on this story: Ezra Fieser in Bogota at efieser@bloomberg.net

To contact the editors responsible for this story: Nikolaj Gammeltoft at ngammeltoft@bloomberg.net, Andrea Jaramillo

©2020 Bloomberg L.P.