The Spanish Supreme Court has cleared the way for 200 new private-hire vehicle licences in Gran Canaria, potentially opening the door for services such as Uber and Cabify to expand onto the island.

The ruling means the Gran Canaria Cabildo must process applications for the 200 VTC licences after the court found that restrictions imposed under Canary Islands legislation conflict with European Union rules on freedom of establishment.

VTC licences are the permits used in Spain by chauffeur-driven private-hire services, including platforms such as Uber and Cabify.

The dispute centres on a restriction introduced by the Canary Islands Government in 2014, which established a maximum ratio of one VTC licence for every 30 taxi licences.

Once that threshold was exceeded, island authorities could refuse further applications.

The Canary Islands High Court had already ruled against applying the restriction in this case, but the Cabildo and the Regional Taxi Federation appealed to the Supreme Court.

They argued that the Canary Islands' special status as one of the EU's outermost regions should allow the islands greater scope to impose restrictions reflecting their particular circumstances.

However, the Supreme Court found that this status did not provide sufficient grounds to override European rules on freedom of establishment.

The Cabildo had also argued that limiting the number of private-hire vehicles was justified by environmental concerns, the capacity of Gran Canaria's road network and the need to control growth in the number of vehicles on the island.

Judges rejected those arguments as sufficient justification for the blanket one-to-30 restriction, finding that the objectives could potentially be achieved through less restrictive measures.

The court pointed to alternatives such as restricting vehicles in particular areas or at certain times, or introducing emissions limits.

The ruling does not itself abolish the Canary Islands legislation. However, the Supreme Court found that the restriction should not be applied in this particular case because of the precedence of directly applicable EU law.

As a result, a 2024 Canary Islands High Court ruling now takes effect, requiring the Gran Canaria Cabildo to process the 200 VTC licence applications requested by a company in the sector.

For residents and holidaymakers, the ruling does not mean that 200 Uber or Cabify vehicles will immediately appear on Gran Canaria's roads. The decision concerns the processing of VTC authorisations, meaning the licences must first go through the relevant administrative procedures before any resulting services can begin operating.

Could today's ruling affect the other islands?

The ruling could also have implications beyond Gran Canaria, with interest in VTC services growing elsewhere in the Canary Islands. Uber has recently been preparing for an expansion in Tenerife, although new VTC authorisations across the archipelago are currently subject to restrictions introduced under regional transport legislation.