Uber: Your Safety in Your Own Hands

Uber: Your Safety in Your Own Hands

There is no correlation between Uber’s marketing claims and the actual contract you sign. The contract makes it clear that Uber is not responsible for any adverse events. This could fall under the category of active misrepresentation or selling under false premises.

The immediate actions of the Delhi government against aggregator firm Uber after the tragic event in Delhi were severely criticised in social media and by internet activists with a liberal mindset, almost all of whom lined up behind Uber and complained of overreach.

While the ban can be debated — and the Delhi Government has since nuanced its position to the extent of now saying that it only has a white list of authorised radio cab operators and there is no ban—the actions of Uber do merit rigorous scrutiny.

Uber: Your Safety in Your Own Hands

 The key to understanding the risk of using Uber is to understand the commercial contract between the customer in India and Uber for each ride taken by the customer.

 1. Essentially this is a software contract—nothing more, nothing less. All you are getting is a non- exclusive licence to use the Uber application.

 2. There is no security or driver vetting guarantee or assurance in the contract. The driver-to-rider matching service is provided, as is. You are using the service entirely at your own risk and have specifically released the company from any liability arising from any adverse action from its transportation partners. Further, you have explicitly agreed that Uber’s liability is capped at €500. The use of the term “partners”—not agents or employees of the company—is very important. It is being made clear to the customer that he/she is dealing with an external third party.

 3. There is no correlation between Uber’s marketing claims and what the actual contract says. Even today, this writer received a marketing email from Uber saying: “Nothing is more important to us than your safety…Currently, we also have strong existing mechanisms within our app and verification procedures to ensure your safety.” But the actual contract that you sign eschews any such assurance, and indeed makes it clear that Uber is not responsible for any adverse events. I would assume that this could fall under the category of active misrepresentation or selling under false premises.

 4. Finally, you are contracting with a company based in Amsterdam. So, even if you want to legally pursue them, the jurisdiction for the contract is of  Netherlands, not India. As an aside, you, the customer, are engaging in foreign exchange transaction every time you ride Uber, and drawing down on your annual currency quota set by the Reserve Bank of India. Did you realise that you were making a foreign remittance every time you used Uber?

 Therefore, the ban was not a good idea. Instead, if I were the supervising authority, I could only issue the following travel advisory:

 On review, we find that the safety claims of Uber are non-verifiable, non-auditable and certainly not enforceable—the data servers and/or systems with potential driver records are also not available in India for instant review.

Any adverse event in using an Uber-provided cab would have to be prosecuted against the errant and individual driver and Uber would bear no liability. Customers of Uber need to evaluate the safety of each ride themselves and they have no institutional protection prior to any adverse event. In effect – you are using the Uber service at entirely your own risk.

 Further, based on the above, and the fact that Uber is a matching service or a marketplace, and not a cab operator, no new regulation or framework is required in India to monitor Uber. Existing commercial laws and more importantly, the Competition Commission of India would be able to deal with all complaints.

 In a debate invoking Swarajya’s stand on the issue as expressed in Surajit Dasgupta’s article, close friend and Supreme Court Advocate P. Sureshan wrote:

The agreement issue (points 2 and 3 above) can be inquired by the Competition Commission of India under section 19 of the Competition Act if its agreements are anti-competitive or it is abusing its dominant position (in the market) described under Sections 3 and 4 of the Act.

So there is a regulation to deal with the issue, as many are unaware about the powers and functions of the Competition Commission, this issue might not have been referred for their decision.

The bottom line is that Uber is not providing any additional layer of safety to its riders; in fact, it can be argued that Uber’s marketing may be promoting complacency in the use of such cabs, and riders may be lowering the care and diligence that they would otherwise take in hailing a cab from a cab stand or a radio taxi number. So, Rider Beware—your safety is in your own hands.

Supratim Basu is an independent investment professional based in Mumbai.

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