The hits just keep on coming for Uber.
Uber — at once one of the most loathed and yet most successful, in terms of capital raised, startups in recent memory — hit a speed bump in its attempted Asia rollout when prosecutors in South Korea charged Chief Executive Officer Travis Kalanick with violating a transportation law.
The head of Uber s domestic business partner, MK Korea Co., also faces charges. Uber s South Korea unit and MK Korea were flouting a local transportation law prohibiting rental cars from operating as cabs illegally operated rental cars as taxis, an official with the Seoul Central District Prosecutors Office told Bloomberg. The Seoul Metropolitan Government says it will offer monetary rewards to people who provide information on Uber s services.
The official declined to comment on whether prosecutors expect Kalanick to appear for questioning. The maximum penalty Uber s alleged legal violation is a two-year prison sentence or a fine of as much as $18,000, South Korea s Yonhap News Agency reported.
Uber said it will fully cooperate with the investigation and is confident that the court will uphold a fair and sensible judgment in the case.
Uber Technologies respects the Korean legal system and will provide its full cooperation, the company said in a statement.
The indictment is just the latest stumble for Uber in Asia, which the startup has focused its expansion plans. Law enforcement officials in China last week reportedly raided an Uber training session for new drivers held at a site in Chongqing. The Wall Street Journal reported that there were more than 20 drivers in attendance, including one person who had recently been released from prison after a conviction for theft. Authorities in Chongqing have launched in investigation into the company.
Authorities in Taiwan are considering a ban on Uber, and the transport ministry there said Uber is licensed to provide information services rather than transport, according to Reuters. And the company is under scrutiny in India after a driver was arrested for allegedly raping a passenger. Uber apologized and suspended services in Delhi while it reviews its operations there.
Uber raised $1.2 billion earlier this month from investors, including China-based Internet company Baidu, valuing the ride service at $40 billion and making it the most valuable startup among venture-backed private companies. Uber said it planned to use the capital to expand in Asia.
Photo of Uber CEO Travis Kalanick by Evan Agostini/Invision/AP
