Uber said it had been forced to suspend services in the capital Budapest because new powers granted to authorities this month allowed them to penalise drivers and block internet access to “illegal dispatcher services”.
The law is the latest regulatory setback in Europe for the company, where it has encountered strong opposition by taxi drivers and frequent restrictions by local courts.
The San Francisco-based company works with 1,200 drivers in Budapest and says it has 160,000 registered users there.
“The new legal framework makes it impossible for our partners to drive by threatening to seize their personal drivers’ licences and personal vehicles, in addition to several other punitive penalties,” said Robbie Khazzam, Uber’s regional manager for central and eastern Europe.
Uber has also faced regulatory pushback in France, Belgium, Germany and Italy, all countries in which it has suspended its Uber Pop service, which matches passengers with unlicensed drivers.