By a decision of the Supreme Court, the community of Madrid revisited the 2018 rejection of 1,000 VTC licenses. Maxi Mobility Spain had appealed the regional administration’s ruling, and the Controversial Administrative Chamber of the Supreme Court partially granted that appeal. The ruling indicates that the license cap would exceed the approved 1-for-30 taxi fare limit in certain cases.
The decision published on Wednesday clarifies that overturning the rejection law does not automatically grant concessions. Instead, the autonomous administration is required to re-evaluate the applications and reconsider the procedure so that the rule in force at the time of the original decision is applied. Consequently, the fixed quantity limitation cannot be imposed retroactively; it is regulated by Article 181.3 of the Land Transportation Operation Law Regulation 1/30.
CJEU jurisprudence
The Supreme Court notes that the Court of Justice of the European Union found last June that it is permissible to limit VTC and taxi powers by a 1/30 ratio. This does not amount to covert state aid to the taxi sector, but it does raise questions about freedom of establishment as enshrined in EU constitutional law. The safeguard is that the restriction must be appropriate to achieve goals of efficient transport management, orderly use of public space, and environmental protection, while ensuring these aims can be reached.
Numerical reasons
In this case, the Supreme Court points out that the Community of Madrid did not assess whether the official requirements for issuing VTC licenses were met. Instead, it relied on a purely numerical extrinsic prohibition that ultimately vetoed granting authorities from increasing the number of VTCs already in existence.
As a result, the licensing issue demands re-analysis. The decision states that regardless of how correct the Administration’s actions might appear, the court cannot grant permission without the Administration verifying compliance with current requirements. It is declared that, at the time of the official request, permits must be issued in line with the legislation then in force. Therefore, the licensing process remains operative under retroactive considerations and continues to be governed by applicable regulations.