The legal nature of online platforms: the Uber and Airbnb cases
With the Airbnb and Uber judgments, the Court of Justice ruled on the legal qualification of two very important online platforms. In this article, we are going to understand to what extent an online platform can be qualified as an 'information society' and when not.
One of the founding principles of the EU internal market is the free movement of goods and services. As we have already discussed some of the problems that the European legislator has had to deal with in trying to find a balance between the principle of free trade in goods and the interest of producers in creating competitive distribution networks (The mixed system: when the manufacturer chooses to adopt both exclusive and selective distribution), this article intends to focus attention on how the principle of free movement of services coordinate with the operation of platforms onlinewhich increasingly characterise the economic fabric of the internal market.
To do so, one must probably start from the origins of European law, which, with the introduction of the internal market (Art. 26 of the TFUE), aimed at guaranteeing any entity operating in a Member State to carry out an economic activity in another Member State (Art. 54 - Freedom of establishment) and offer its services there (Art. 56 - Services)[1].
With the 2006/123/EC[2] (relative
services in the internal market) Europe wanted to strengthen the principle of the
freedom to provide services[3], considering
that the pursuit of this objective "aims to establish increasingly
between the states and peoples of Europe and to ensure economic progress
and social"[4]as well as
to eliminate "barriers in the internal market [that] prevent the
providers, in particular small and medium-sized enterprises, to expand beyond the
national borders and make full use of the single market. "[5]
To understand whether the services offered by the platforms online, who increasingly play the role of intermediaries with the end user, fall under the definition of 'services" referred to in Article 56 TFEU and Article 4 of Directive 2006/123 and are therefore addressees of the protections guaranteed by those rules, it is first necessary to give a definition of 'platform online". Indeed, if one searches within the European legislation, the only definition provided to us is that of "online brokerage"referred to in Article 2 of Regulation 2019/1150[6]this rule qualifies this activity as that performed by "information society services', pursuant to Article 1(1)(b) of the directive 2015/1535[7]which in turn is taken from Article 2(a) of the Directive 2000/31[8] on e-commerce.
It is therefore at the term 'information society service" that one must resort to in order to begin to give legal status to such entities; it is qualified (by the above-mentioned directives) as any service "normally provided for remuneration, at a distance[9]electronically[10] and at the individual request of a recipient of services."
The EU after having defined, albeit generically, the concept of information societywith Directive 2000/31 considered it appropriate to ensure that the free market for services is also ensured for entities operating online and, in order to induce Member States to remove restrictions on the cross-border movement of services rendered by the information societyArticle 2 stipulated that Member States may not adopt measures restricting this exercise unless they are necessary for reasons of public policy, public health, public security or consumer protection (Art. 3).
Furthermore, it provided that the Member State must (subject to nullity of the measure)[11] having previously notified the Commission and the Member State in whose territory the service provider in question is established of its intention to take the restrictive measures in question (Article 3(b), second indent).
It follows from this that it is of paramount importance to understand whether a platform online may or may not be qualified as information societysince only in the latter case will the person enjoy the above-mentioned specific protections recognised by European law on the free movement of services.
On this point, it should be noted that the Court of Justice was recently asked about this very issue, in relation to the mediation services provided by the digital platforms Uber Spain, Uber France and Airbnb Ireland. We will now briefly analyse these rulings in order to try to understand what is the ratio which led the Court to take opposite decisions on (apparently) very similar situations.
1. The Uber Spain and Uber France cases.
With two 'twin' decisions, Uber Spain of 20.12.2017[12] and Uber France of 10.4.2018[13]the Court of Justice was called upon to decide whether the UberPop service, which is provided via an international platform, should be assessed as transport service and in that case subject to national legislation making the carrying out of that activity conditional on the hauliers obtaining a licence, or a service of the information societywith the consequent requirement of prior approval by the Commission of national regulatory measures prohibiting such activity.
The European Court of Justice in its first analysis acknowledged that:
"an intermediary service enabling the transmission, by means of a smartphone application, of information relating to the booking of a transport service between the passenger and the non-professional driver, who, using his own vehicle, will carry out the transport, meets, in principle, the criteria to be qualified as an 'information society service'."[14]
In any case, the
Court continues its reasoning by analysing in a
detailed what brokerage services actually are
provided through the use of the Uber application, noting that the company did not
is limited merely to putting in contact (and thus mediating) the
carrier and the transported, but also:
- select non-professional drivers
using their own vehicle and with the help of theapp of Uber,
provide a transport service to persons intending to make a
movement in the urban area, which otherwise they could not have resorted
to these services; - fixed if nothing else the price
maximum running; - receives payment of the customer and subsequently
pays it to its driver; - exercises control on the quality of
vehicles and their drivers and their behaviour; - in some cases may exercise against
their drivers exclusion from service.
The Court, having analysed the report in its entirety, therefore came to the conclusion that:
"the brokerage service in
discussion [must] be considered as an integral part of a service
total of which the main element was a transport service, and
therefore fulfilling the qualification of 'information society service' not
[...] but to the service aspect of 'transport quality'.Pursuant to
Article 2(2)(d) of Directive 2006/123'.[15]
In view of this
legal classification of the service provided by Uber, the Court held
legitimate regulatory measures that the Spanish and French states had
enacted to prohibit and repress the exercise of this activity, taking into account
that transport services are explicitly excluded from the scope of
implementation of directive 2006/123[16] (and therefore
neither subject to the obligation to inform the Commission under Article 3
of Directive 2000/31).
2. The caso Airbnb of 21.12.2019
The same procedure
argumentation was followed by the Court in a similar case,[17] where one
found itself engaged in deciding on the legal framework of the
intermediation service provided by Airbnb Ireland through the
its electronic platform, with which they are put in contact, behind
remuneration, potential tenants with landlords, professional or otherwise, who
offer short-term accommodation services.
The issue had arisen because the French Association for Accommodation and Professional Tourism (AHTOP) had filed a complaint against Airbnb Ireland, complaining that the Irish-registered company was carrying out a real estate mediation activity on French territory, which is subject under domestic law (Law Houget) to a licensing obligation.
Airbnb Ireland, denying that it was acting as a real estate agent, entered an appearance claiming the right to freedom of establishment and arguing that the law was inapplicable to it Houget because of its incompatibility with Directive 2000/31, claiming to operate in French territory only as information society.
The Court, echoing what was decided in the previous Uber rulings, again affirmed the principle of law that in order to be able to recognise the legal nature of information societyit is not enough that they are only if the four conditions are met cumulative as referred to in Article 1(1)(b) of the aforementioned Directive 2015/1535, but it is also necessary to verify whether it appears that:
"said
mediation service is an integral part of an overall service the
which main element is a service to which a different
legal qualification".
The Court held that the services provided by the platform related to presenting offers in a coordinated manner, with the addition of tools for searching, locating and comparing them, constitutes themain element of the service and cannot therefore be considered merely ancillary to a service to which the different legal guise of provision of accommodation must be applied.[18] In contrast, all these services (analysed in detail in recital 19 of the judgment)[19] represent the real added value of the electronic platform that allows it to stand out from its competitors.[20]
Following this reasoning, the Court held that Airbnb Ireland cannot be classified as a real estate agentThe purpose of its activity is not only to rent accommodation, but to provide an instrument facilitating the conclusion of contracts concerning future transactions. It is stated on this point that:
"a service such as that provided by the
Airbnb Ireland is not at all indispensable to the realisation of
accommodation services from the point of view of both tenants and landlords
who have recourse to it, since both have numerous other channels [...].
The mere fact that Airbnb Ireland enters into direct competition with
the latter channelsproviding its users, i.e. both landlords and
to tenants, an innovative service based on the particularities of a business
information society business does not allow us to derive from this
the indispensable character for the provision of a service of
accommodation."
Given the legal nature of Airbnb Ireland's information societythe Court declared that it was not subject to the licensing requirement imposed by French law (Loi Houget), as restricting the free movement of services, also noting that this regulatory measure had in any event not been notified to the Commission in accordance with Article 3 of Directive 2000/31.
Very interestingly, the Court came to a different decision to the Uber case, recognising the nature of information society serviceon the assumption that Airbnb Ireland does not exert a decisive influence on the conditions of the provision of accommodation services to which its mediation service relates, taking into account that the same neither directly nor indirectly determines prices of lettings, nor does it carry out the selection of landlords or accommodation offered for rent on its platform.[21]
From the study of the two judgments, it can therefore be seen that it is the independence and the failure to control on the entity using the electronic platform to promote its service, a central element in understanding whether the platform online whether or not it provides an intermediary service, which can be classified as service of information society and that this must be assessed by analysing the relationship in its entirety.
The above rulings are certainly of great significance not only from a legal point of view, as they lay the foundations for framing figures who increasingly occupy a fundamental role in our economic and social fabric.
[1] Art. 56
TFRUE "Within the framework of the following provisions, restrictions on the free
provision of services within the Union are prohibited in respect of the
nationals of Member States established in a Member State other than the one
of the recipient of the service. "
[2] Directive
2006/123/EC of the European Parliament and of the Council of 12 December 2006,
on services in the internal market.
[3] This directive
defines in Art. 4(1) as "service' means any activity
unpaid economic activity referred to in Article 50 of the Treaty provided normally
against remuneration. "
[4] Id.
Recital 1.
[5] Id.
Recital 2.
[6]
Regulation of 20 June 2019, promoting fairness and transparency for the
commercial users of online brokering services, effective as of
from 12.7.2020.
[7]
Directive that repealed and replaced the previous directive
98/34/ECwhich defined services
[8]
Directive 2000/31/EC of the European Parliament on certain legal aspects
of information society services, in particular trade
electronic commerce in the internal market ('e-commerce directive')
[9] La
directive definesremotely"a service provided without the
simultaneous presence of the parties.
[10] La
directive defines: "electronically": a service sent originally
and received at destination by means of electronic processing equipment
(including digital compression) and data storage, and that it is
entirely transmitted, forwarded and received by wire, radio, optical means
or other electromagnetic means.
[11] Cf.
on the point Judgment
of 19.12.2019 Airbnb Irland UC vs. Association pour un hébergemen et un
tourisme professionnels (AHTOP).
[12] Judgment
of 20 December 2017, Associación Profesional Elite Taxi vs. Uber Systems
SpainSL,
[13] Judgment
of 10 April 2018, Uber France s.a.s.
[14] Id. 19
[15] Id. 40.
[16] Cf.
Art. 2(2)(d) Directive 2006/123
[17] Judgment
of 19.12.2019 Airbnb Ireland UC vs. Association pour un hébergemen et un
tourisme professionnels.
[18] Judgment
of 19.12.2019 Airbnb Irland UC vs. Association pour un hébergemen et un
tourisme professionnels (AHTOP), No. 54
[19] Id. In
recital 19 lists in an analytical manner the services actually offered by
Airbnb that are "In addition to the service of connecting
landlords and tenants via its electronic centralisation platform
of the offers, Airbnb Ireland proposes a number of other
services, such as a scheme defining the content of their offer, in
option, a photography service, likewise as an option, insurance for
liability as well as a guarantee for damages up to an amount of
to EUR 800 000. In addition, it provides them with a service
optional to estimate the price of their rental in the light of the averages of
market from that platform. Moreover, if a lessor accepts a
lessee, the latter transfers to Airbnb Payments UK the price of the
lease to which must be added an amount, ranging from 6% to 12% of said
amount, by way of fees and service charged to Airbnb Ireland.
Airbnb Payments UK holds the funds on behalf of the lessor after which, 24
hours after the tenant enters the accommodation, it transmits them to the landlord
by bank transfer, thus enabling the tenant to be sure of the existence
of the asset and to the lessor the guarantee of payment. Finally, Airbnb Ireland has
established a system whereby the lessor and the lessee can
make a judgement by means of a grade ranging from zero to five stars, grade
available on the electronic platform in question. "
[20] Id. 64
[21] Id. 68
