December 4, 2015 / 9:04 AM / 3 years ago

Uber driver convicted in Australian state in latest blow to firm's expansion plans

MELBOURNE (Reuters) - An Uber driver in the Australian state of Victoria was convicted on Friday for operating a commercial vehicle without a license, in a decision the local transport minister said confirmed the illegality of ride-sharing services in the state.

Uber has grown aggressively worldwide with its matchmaker service for drivers and passengers. But a lack of regulation for the relatively new business model has brought it to the attention of authorities, stalling expansion.

In Australia, where Uber targets 20,000 driver “partners” by year-end, Canberra in October became the first world capital to introduce ride-sharing laws. But in nearby Victoria state, regulations are still under review.

On Friday, Nathan Brenner was fined by a magistrate in Melbourne in a ruling state Public Transport Minister Jacinta Allan said confirmed “the ride sharing industry is an illegal service here in Victoria”.

“We’ll have to work through those issues and continue to work with industry in the manner that we have been doing, on dealing with the regulatory issues,” Allan said at a news conference.

Brenner was the first to face court among 13 drivers accepting paying passengers via the UberX service, after they were caught by the hire car regulator in a sting operation last year. A similar ruling is expected for the other drivers.

Uber Technologies Inc [UBER.UL] spokeswoman Katie Curran said the company was disappointed by the decision and would continue to support Brenner in his appeal, as well its 6,000 UberX drivers in Melbourne and the nearby Geelong region.

“This should be a policy decision for Government not a matter for the courts,” she said. “Uber will continue to operate in Victoria.”

Uber has proved popular with the Australian public, notching more than one million registered users in a country of just 24 million even in the face of pushback from the taxi industry and many local authorities.

Though the legal status varies across the country, the federal government still collects a goods and services tax from ride-sharing drivers regardless of location.

“I’d encourage Uber to consider the position they’re putting those drivers in, if they continue down this path while the matter remains unresolved,” Allan said.

Uber had 15,000 driver “partners” in Australia at the start of October. Local rival goCatch, which uses licensed taxi drivers, counts 30,000 of the country’s 68,000 drivers as members.

Reporting by Melanie Burton; Editing by Christopher Cushing

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