Everything about Uber license in Ukraine

Since passenger transportation is one of the types of business activity, the publication will cover main legal aspects of such activities and related licensing documents.

It should be noted that the comment uses Uber as a typical representative of the category, but most of its provisions will be relevant to other carriers with a similar business model (Uklon, Yandex Taxi etc.).

Activity

Firstly, it is important to understand the issue, namely, what kind of service is provided by Uber drivers? In the analysis, we will proceed from the following characteristic features:

• services are provided by passenger cars (category B);
• there are no or minimal identifying marks on the machines (for instance, a sticker with the Uber logo, telephone number etc.);
• services are provided in large cities of Ukraine and their suburbs.

According to the Subsection 3 of Resolution of the Cabinet of Ministers of Ukraine under the number 1001 of 02.12.2015 (licensing conditions of carriage) business activity in this sphere may be conducted in the following types:

1) in Ukraine:

• transportation of passengers by taxi;
• transportation of passengers by cars on request;
• bus transportation;
• cargo transportation of hazardous materials.

2) international:

• transportation of passengers by taxi;
• transportation of passengers by cars on request;
• bus transportation;
• cargo transportation;
• cargo transportation of hazardous materials.

Considering the abovementioned characteristic features, the search circle can be narrowed down to two types: transportation of passengers by taxi and transportation of passengers by cars on request in Ukraine.

In turn, Article 1 of the Law of Ukraine "On Motor Vehicle Transport" defines a taxi as a passenger car with the following characteristics:

• recognizable orange position lamp on a roof;
• signal red-green lamp on a windshield;
• squares compiled on doors of a car;
• the presence of a taximeter.

As you can see, such a description does not correspond to Uber cars, therefore, the only possible option is to provide services for transportation of passengers by cars on request.

Organizational and legal form

At that point, we know, what Uber drivers are doing, so let's find out in what form they can provide such services.

Section 5 of Article 42 of the Law of Ukraine "On Motor Vehicle Transport" stipulates that a relevant agreement between a car carrier and a customer is concluded for the car service.

Article 1 of the Law defines a car carrier as an individual or legal person, who carries out transportations on a commercial basis. In turn, Article 29 of the Law specifies that car carriers are business entities. Article 128 of the Commercial Code of Ukraine determines a business entity as a citizen, who carries out entrepreneurial activity under the condition of state registration of him as a sole proprietorship.

Thus, the transportation of passengers by cars on request can be provided either by any legal entity or by a sole proprietorship. In addition, the Law of Ukraine "On Motor Vehicle Transport" stipulates the provision of the abovementioned services by self-employed carriers.

Structuring options

Traditional (and most transparent) forms of work structuring for the type of transportation are the following:

• a legal entity with officially hired employees;
• a sole proprietorship with hired workers;
• a sole proprietorship, who provides services on his own.

At the same time, the following options of development requests are the most popular:

• usage of similar permission documentation of another business entity by one carrier without a license;
• ability to hire drivers with their own transport under the valid license of the business entity.

The last two options are questionable from the legal point of view at the best.

In the part of the usage of a license of one carrier by other it is necessary to proceed from the personal nature of the license. For instance, the licensing law defined a licensee as a business entity that obtained a license for a particular type of business activity. License transfer is prohibited. Therefore, in the case of several entrepreneurs or enterprises, a license must be obtained for each of them.

Regarding the hiring of drivers under an existing license, such a procedure can be absolutely legal. For this purpose, a license holder is obliged to hire car owners, obtain temporary registration certificates on their cars and notify the licensing authority of such changes in due form.

In practice, carriers often avoid both obtaining a license and bringing changes to already obtained one, which can be quite a risky decision, in order to avoid the abovementioned bureaucratic procedures.

Permission documentation

Article 42 of the Law of Ukraine "On Motor Vehicle Transport" a general permission document for all organizational and legal forms is a license.

At the same time, the list of necessary documents will be based on the organizational form. For sole proprietorships who provide services by themselves (usually by their own vehicle), the requirements are rather ordinary and are limited to the submission of a technical passport and a corresponding package of documents to the State Service of Ukraine for Transport Safety.

For legal entities, regardless of the number of vehicles, the list of documents automatically becomes more complicated. To the already mentioned documents are added what is referred to as contracts with the automobile enterprise (on medical examination of drivers, parking, technical inspection etc.).

Problems of formation of a contract

Although legally the most appropriate scheme for working with Uber is passenger cars on request, it does not do without inconsistencies in the legislation. It should be noted that the scheme of Uber work is problematic from a legal point of view in many countries of the world, including Ukraine (the abovementioned example with structuring has been considered).

One of these ambiguously regulated issues is a formation of contractual relations. The fact is that Article 1 of the Law of Ukraine "On Motor Vehicle Transport" stipulates the need to sign a written contract between a carrier and a legal entity or an individual, who order a trip. The contract is concluded for each carriage separately or for the provision of services within a certain period.

Everyone who used the services of Uber at least once knows that no written contract is certainly signed.

How then should a carrier be? Does he violate the law?

Up to date, traditional for the Uber carrier is signing of a charter contact, by which he provides a car in freight with the crew for a specified period. At the same time, such contact is concluded in electronic form, but without signing it in full accordance with the provisions of the Law of Ukraine "On electronic commerce", which would allow to equate it with writing form.

Instead, an electronic contract states that it is considered to be concluded in writing form without its signing. This position seems rather unreliable and mainly focuses on the need to protect Uber service not carriers.

A solution to the question lies in the fact of ??improving either legislation on electronic commerce in part of expanding options for recognizing electronic form of a contract as an analogue of written form, or motor vehicle legislation in part of eliminating the requirement of a written form of the contract or the inclusion of its electronic form as an alternative.

Conclusion

Therefore, we conclude that, although the legislation on these issues is not sufficiently clear, lawyers have already developed mechanisms, which allow entrepreneurs to carry out their activities in accordance with the law with minimal expense of forces and time for the formation of such activities.