Uber counts 45,000 drivers in London and 3.5 million users of its app | Daniel Leal-Olivas/AFP via Getty Images Uber loses London operating license London Mayor Sadiq Khan cites thousands of fraudulent trips by unlicensed drivers in his condemnation of the app.

Uber just got canceled in London.

In a serious blow to the ride-hailing firm, U.K. regulator Transport for London yanked Uber's operating license in the city on Monday over what Mayor Sadiq Khan said was a "pattern of failure that has directly put passenger safety at risk."

"I know this decision may be unpopular with Uber users but their safety is the paramount concern," he said in a statement. "At this stage, TfL [Transport for London] can't be confident that Uber has the robust processes in place to prevent another serious safety breach in the future."

While Uber will continue to operate in London pending an appeal process, the move is nonetheless a substantial setback for a company that has spent the past year trying to reboot its presence in Europe following a number of clashes with regulators and national courts.

In an interview earlier this month, a senior Uber executive told POLITICO the firm was eyeing smaller countries in Central and Eastern Europe as growth markets thanks to liberalization of taxi sectors. Uber has also launched a fresh push into Germany, where its service had been banned in several cities.

Yet London remains a key market where Uber has some 45,000 drivers and 3.5 million users.

The Transport for London decision signals that Uber remains vulnerable to regulatory setbacks — even in places where it has been long established and has built up a major base of users.

In his statement, Khan underscored some 14,000 “fraudulent trips” with unlicensed drivers taking over existing accounts as reasons for not renewing the license — an argument fiercely contested by Uber.

Uber's regional manager Jamie Heywood called the decision "extraordinary and wrong," while confirming that the company would appeal.

Uber for safety

Uber's collision with Transport for London has been a long time coming.

In 2017, the regulator revoked Uber's license because it had failed to meet a so-called "fit and proper" test to hold a transportation license. The latest decision came at the conclusion of a 15-month probationary licence granted to the app in 2018, which was extended for a further two months in September.

Uber, which was listed on the stock market in May and is trying to stanch losses in the billions of dollars, has introduced a number of new features aimed at addressing regulator criticism over recent years, including placing limits on driving hours in a bid to increase road safety and a 24-hour support line.

“We have fundamentally changed our business over the last two years and are setting the standard on safety," said Heywood.

Free-market advocates quickly cried foul, pointing to Uber's record as a job creator for low-income people.

Matthew Lesh of the Adam Smith Institute, a libertarian think tank, called Khan’s move a "total disgrace."

"Uber provides thousands of jobs for low income and immigrant Londoners. It provides a much-loved service to get people home safely at night. It is more affordable than other cabs and provides a flexible working life for drivers," he said.

Mark Scott contributed reporting.