Uber is facing a "strong crackdown" by the South Korean government, which rejected Uber's claims that it was negotiating a new driver registration system with the government.
South Korea's Ministry of Land, Infrastructure and Transport says in a news release that it is working to woo over members of the parliament to pass a bill that would prohibit ride-sharing services such as Uber and Lyft from operating in South Korea.
The statement comes just a day after Uber senior vice president of policy and strategy David Plouffe told local media that the San Francisco-based startup says it wants to propose a new registration system that would allow Uber to legally operate in Seoul by allowing Uber drivers to apply for commercial licenses and subjecting them to stricter requirements, such as having insurance and the minimum amount of work experience.
"The solution that we seek with Seoul city, the ministry of transportation, and the National Assembly is to find a solution that works for taxis, works for consumers, and works for the overall Korean economy," Plouffe told reporters on Wednesday.
Uber's proposal has already been accepted in a number of cities around the world, including London, New York, and Los Angeles. This, Uber believes, highlights a shift in gears for the largely derided startup, which is criticized for exploiting legal loopholes in the taxi industry and pushing aggressive business practices such as surge-pricing.
"We are eager to seek solutions with Korean officials at a local and national level to offer an alternative service that works well for the city," Plouffe said.
A Seoul municipal official, however, said the government has "no plans to discuss this proposal with Uber." According to the South Korean transportation ministry, any plans to register Uber drivers is tantamount to registering them as taxis, and that would be in opposition to the ministry's plan to reduce the number of taxis in the area.
Uber's proposal, says the ministry, "would deepen excessive competition and threaten the livelihood of small taxi companies." Outside the hotel where Plouffe was speaking to reporters on Wednesday, around a hundred local taxi drivers staged a protest demanding that Uber leave the country because it is a threat to their jobs.
Seoul is the latest government to take moves to ban Uber from operating in its premises, following after Spain, Portland, Oregon, and New Delhi, India, which banned Uber as an Uber driver sexually assaulted a passenger.
However, Uber has been actively trying to appease the South Korean government after its CEO Travis Kalanick was indicted in December for violating a South Korean rule that requires all vehicles to be used for business purposes to be registered. If found guilty, Kalanick could face up to two years in prison and a fine of 20 million won or just a little over $18,000. The government is also offering 1 million won or just above $900 to report drivers and passengers using Uber.
Seoul could prove to be a lucrative market for Uber. The city is one of the richest cities in Southeast Asia with a large upper and middle class that could become one of Uber's most valuable customers.
