The European Court of Justice has decreed that Uber should be regulated as a transport company - although the firm has said it will not affect its UK operation.
Uber had argued it was a third-party technology service enabling people to contact each other, rather than a taxi company.
But the European Court of Justice, based in Luxembourg, found that it "must be regarded as forming an integral part of an overall service whose main component is a transport service."
The case stemmed from a complaint by Barcelona taxi drivers who claimed Uber drivers should be licensed.
While the ruling could change the way Uber operates in some European cities, a spokesman for the company said: "This ruling will not change things in most EU countries where we already operate under transportation law."
Uber and its drivers already have to obtain operating licences from local authorities in the UK.Uber was stripped of its London licence in September, but subsequently challenged the Transport for London ruling and remains able to operate indefinitely. It has also been banned in York and, briefly, in Sheffield.