Uber faces new legal issues- this time in Rio, Brazil image

The city’s transport office has just announced that drivers of the San-Francisco-based Uber Technologies Inc., the ride hailing service that has been valued at around $40 billion, have no right to operate and could have their cars impounded.

Rio’s municipal transport department, or SMTR, announced it decided to file a complaint with police against Uber and its similar rivals operating in the city – the authority claims they operate illegally as long as they don’t have a proper license for taxi services. The city is increasing its scrutiny as it prepares to host the next Olympics, in 2016. According to the police, now the leader of Rio police’s cyber crime division is investigating the claims. “The SMTR already sent a letter to the police to conduct an investigation,” read a statement, with Uber’s activity called “illegal” because it is “paid transport without proper licensing” – the statement adds that drivers risk having their cars seized.

Launched back in 2010 in San Francisco, Uber – which uses a mobile smartphone application to handle requests for ride sharing – has grown at an explosive rate – offering now its services in at least 250 cities globally. It also secured new funding – worth $1.2 billion – last week, lifting the company’s valuation from $17 billion to $40 billion.

Via Bloomberg