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London Taxi Drivers Association taking action against minicabs that use app as fare meter, which it says is illegal

A queue of London taxis.

London’s black-taxi drivers say Uber’s metering system for minicabs is illegal. Photograph: Tony C French/Getty Images

London’s black-cab drivers are to launch private prosecutions against minicab drivers who use Uber, the booking software that allows smartphone users to hail private-hire cars from any location.

The legal action emerged a day after Travis Kalanick, Uber’s chief executive, confirmed the Silicon Valley company, which has rolled out its service to 115 cities globally, was set for a “record breaking” private fundraising that could see it valued at close to $17bn (£10bn).

The Licensed Taxi Drivers Association is issuing summonses to six Uber drivers on Thursdayon the grounds that it is illegal for private-hire vehicles to be fitted with meters.

The test cases hinge on whether the app comes within the definition of a meter and could affect hundreds of Uber drivers operating in the capital and Manchester, where it launched this month.

The London cabbies’ union is so concerned about Uber that it is planning a mass protest on 11 June with drivers parking in Parliament Square, Trafalgar Square and along Whitehall in central London from 2pm.

Transport for London, which regulates private-hire vehicles, has said the law is “unclear”. On Thursday, it said it would seek a “binding” decision from the high court.

Steve McNamara, LTDA’s general secretary, , said a decision from the high court would be unlikely before the end of the year and described the move as a stalling tactic designed to prevent his union from calling a judicial review. “It is crystal clear Uber are breaching the Private Hire Act,” he said.

The act defines a meter as “a device for calculating the fare to be charged in respect of any journey by reference to the distance travelled or time elapsed since the start of the journey”.

Licensed drivers in cities across Europe and America are protesting at the new wave of taxi-hailing services, which licensed drivers argue endanger passengers and threaten cabbies’ ability to make a living.

Last week, the offices of British startup Hailo, which was set up by three London cab drivers, were vandalised after the company extended its smartphone booking service from black cabs to private-hire vehicles.

In Paris, major roads have been gridlocked by protests and an Uber car was attacked, while the government is looking at ways to outlaw the new wave of cab booking services. There have been demonstrations and legal action in Brussels, Toronto, Berlin and New York.

Despite the opposition, Jo Bertram, UK general manager of Uber, insisted: “I don’t think we’re wiping out anyone, we’re increasing the size of the market.”

She said the technology could mean lower fares and increase consumer confidence: “It’s opening up private hire to people who wouldn’t use it before.” Bertram said existing regulations did not reflect the change in technology, with minicab offices being “the analogue equivalent” of Uber, and added that Uber would welcome the High Court’s scrutiny: “The laws were written prior to smartphones and Google maps, for public safety.”

However, she said that the technology would make passengers safer than ever, as the app gave passengers details of drivers and stored journey records.

Searches for taxis made by users of the Uber app are analysed in the US head offices, while data of journeys has been shared with police in the UK.

Bertram would not disclose whether Uber pays taxes on fare earnings in the UK, although she said it paid all taxes it was liable for. Passengers are charged through a third-party payment system based in Holland. “We keep our financials extremely confidential.”

However, she said drivers’ records would be “very traceable” compared to any cash-in-hand earnings in other minicabs.

The Uber smartphone app shows the user a map, with the location of nearby cars looking for passengers. The customer can order the car and pay the fare from their phone, and Uber uses GPS tracking of the driver’s smartphone (issued by Uber for a £150 deposit) to measure the time and distance travelled by cabs.

For London’s 65,000 private-hire vehicles, the app saves money by reducing the number of journeys they make in search of passengers – for example by ensuring drivers can drive to and from an airport with a fare either way. In return, Uber takes a cut of the fare, typically 20%. The LTDA says measuring time and distance travelled constitutes metering and that only black cabs are licensed to use meters. Customers of private-hire vehicles have to agree the price before the journey based on standard charges.

In a statement, TfL said: “On the issue of taxi meters, the law is unclear and we have taken a provisional view. We will be asking the high court to provide a binding ruling. This is the sensible approach, and we hope that London’s taxi drivers and private-hire drivers and operators will work with us to bring clarity on this issue.”

After his London office wall was graffitied with the word “scabs”, Hailo founder Ron Zeghibe published an open letter on the company’s website urging drivers to accept the upheavals in their industry. Zeghibe said: “The worst thing the taxi industry could do now is deny that things are changing and hold on to the past. Complaining is not a strategy.”

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