Gavel (illustration)
Gavel (illustration) iStock

The popular ride-sharing service Uber took a hit Monday as the Tel Aviv District Court barred the company from operating in Israel.

The ruling cited insurance issues as the reason for the ban, which takes effect on Tuesday.

Uber has been attempting to enter the Israeli market and recently launched UberDay to complement the UberNight pilot program it started in Tel Aviv back in 2016. The ride-sharing service, which enables passengers to summon a private car through an app, has been battling regulators as well as Israel's powerful taxi drivers union.

The Transportation Ministry has been trying to force Uber out of Israel, contending that it does not properly vet its drivers and its cars are not subject to the safety requirements that regular taxis are required to have. Transportation Minister Yisrael Katz also says that allowing Uber to enter the Israeli market would destroy the local taxi industry.

“Anyone who wants to introduce Uber should prepare NIS 8-9 billion ($2-2.25 billion) to compensate the taxi drivers,” Katz told the Knesset Finance Committee in 2016. “If that’s what the Israeli cabinet and the Knesset want, they should prepare the compensation."

Under Israeli law, only registered taxi drivers can accept fares for a ride and the Transportation Ministry would have to change its regulations for Uber to be used legally.

Uber says that they are victims of outdated regulation and special interests. "The transportation regulations were drafted in the 1960s and they haven’t been updated, before cell phones and technology. We are trying to operate, within the correct regulation, but in a regulatory world that doesn’t suit the current reality,” Uber Israel CEO Yoni Greifman told The Jerusalem Post.