Uber loses Supreme Court appeal marking significant victory for private hire operators outside of London
- Perry Richardson
- Jul 29, 2025
- 4 min read
The UK Supreme Court has ruled that private hire operators outside London are not required to enter into a contract for hire as principal when accepting a booking.
The decision ends Uber Britannia Limited’s (UBL) appeal, which aimed to align the national rules more closely with those governing London operators.
The judgment concerned the interpretation of Part II of the Local Government (Miscellaneous Provisions) Act 1976, which regulates private hire vehicles (PHVs) outside London. UBL had argued that, like the position in London, operators nationwide must form a direct contract with the passenger when accepting bookings. The company sought to confirm this via a declaration from the High Court, which was overturned by the Court of Appeal. The Supreme Court has now dismissed UBL’s final appeal.
Lord Briggs, delivering the ruling supported by all justices, stated that the Act does not require operators to accept bookings only by entering into a direct hire contract. The relevant provision, section 56(1), is a “deeming” clause. It ensures that an operator is legally responsible once a booking is made, regardless of whether they act as principal or agent.
The court rejected arguments that the Act implies a contractual obligation upon acceptance of a booking. It noted that such an interpretation would remove the flexibility traditionally allowed in the PHV sector, where arrangements can vary. The triple licensing system, requiring separate licences for operators, vehicles and drivers, is the mechanism designed to protect customers.
The court also dismissed UBL’s reliance on later amendments such as section 55A, which concerns subcontracting. These do not support a broader interpretation that would impose new requirements across the board.
This decision maintains the legal position that private hire operators outside London may operate under various models, including acting as intermediaries or agents, without needing to enter direct contracts with customers.
An Uber spokesperson said: “The Supreme Court ruling confirms that different contractual protections apply for people booking trips in London compared to the rest of England and Wales. The ruling has no impact on Uber's application of VAT, which has been upheld twice by other courts.”
Nia Cooper, Chief Legal Officer at Veezu: “This decision is a triumph for the UK Private Hire sector. The unanimous verdict ends a three-year legal battle and confirms that operators can continue to choose which business model they adopt to run their business. Uber was seeking a declaration that would have resulted in 20% VAT being charged on all PHV fares.
“Today’s outcome protects these often vulnerable passengers from crippling fare increases, avoids undue burdens on licensing authorities, maintains the status quo for licensed PHV drivers and allows the private hire sector to keep serving the people and places that rely on it 24/7. This ruling also shows that British-owned businesses can stand up against global giants that attempt to use litigation as a tactic to shape the sector to suit their business model.”
Kimberly Hurd, Bolt's Senior General Manager for the UK, said: “While this case doesn’t directly involve Bolt, we welcome the Court’s decision to uphold the agency model, a framework taxi firms and customers across the country have relied on for fifty years. This helps protect lower fares for passengers and fair earnings for self-employed drivers, with our research showing that 86% of drivers choose private hire work for the control and autonomy it offers.
“Although this decision is a step in the right direction, rules remain inconsistent across the UK. Outside London, operators can choose between agency and principal models, but in London only the principal model is allowed. It’s time for a modern, consistent regulatory framework that levels the playing field for all operators, regardless of where they are.”
Danny O’Gorman, UK General Manager at FREENOW, said: “This decision will perpetuate the uneven and confusing playing field in the PHV sector, with operators outside of London booking rides as agents and those within London acting as principals.
“The Government’s own analysis estimates that without action, the continuation of the agent model could potentially result in over £1billion being lost to the Exchequer every year.
“The Supreme Court’s ruling highlights the need for urgent government action. Ministers should legislate as soon as possible to ensure all private hire operators are treated as principals, rather than agents, across the UK.
“Additionally, they should then take steps to prohibit the use of the Tour Operators’ Margin Scheme (TOMS) by PHV operators, ensuring the market leaders in the industry are required to pay the same standard rate of VAT as all other players (in their capacity as principals), i.e. at 20%.
“We encourage the Government to act now to protect public finances, create fair competition and make the tax system clearer for everyone."
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