Uber has suspended its peer-to-peer ride-sharing service UberX in South Korea following discussions with the government. The news is the latest in a series of setbacks that the ride-hailing service has encountered in the country, where it has regularly clashed with authorities.
Uber, which was charged with violating Korea’s transportation laws in December, will continue to offer its Uber Black service in Korea despite today’s move. It said also it will make its regular platform open for all taxis in Seoul without charge.
The U.S. firm has been involved in a series of confrontations with Korean officials, which culminated in the government offering ‘bounties’ to citizens who turn Uber drivers in to authorities. Uber is noted for its often aggressive approach to doing business, but the company’s statement on the suspension of UberX is notably conciliatory in tone.
Effective today, we are suspending uberX, our ridesharing platform, and operate UberBLACK as prescribed by current law. This decision was made as part of a proposal to the Taxi Industry.
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Largely due to the leadership and courage of the Transport Division, many divergent views have been refocused, and united into a singular path forward. This has resulted in the proposals being discussed with the Taxi Industry.
Uber said it is still keen to find “a compromise” in Korea that would get UberX back on the roads. Passengers had been offered free rides on UberX, a tactic that seemed to win it new friends, but ultimately when the long arm of the law is involved, even Uber has an obligation to work within legal frameworks if it wants to do business.
CEO Travis Kalanick promised last year that Uber would be “a smarter and more humble company” in 2015 following a series of public relations disaster that led many — this writer included — to question the company’s ethics. While it scaled its business to more than 200 cities worldwide in 2014 — a hugely impressive feat from an operations and business perspective — Uber had a tumultuous year. It was accused of spying on journalists and playing fast and loose with user data, while a passenger was allegedly raped in India.