Private Law Research

The Theory of “Platform Service Contract”: Snap and Drivers’ Contract in Light of Case Law

Document Type : Research Paper

Authors

mohamad hosein osta 1
morteza shahbazinia 2

1 Ph.D. Student of the Department of Private Law, University of Tarbiat Modares, Tehran, Iran

2 Associate Professor of the Department of Private Law, University of Tarbiat Modares, Tehran, Iran

https://doi.org/10.22054/jplr.2025.82693.2888
Abstract
This research examines the legal nature of the contractual relationship between the owners of the Snapp ride-hailing digital platform and its driver-users (commonly referred to as "driver-partners"). The principal aim of this study is to analyze and determine the appropriate legal classification of the relationship between these two parties. Given the complexities inherent in such platform-based contracts, the nature of the agreement is often mischaracterized or ambiguously interpreted under traditional legal frameworks such as employment contracts, service contracts, agency agreements, or usufruct arrangements.The methodology employed in this study is descriptive-analytical. Initially, a representative contract between Snapp and its driver-partners was examined. Subsequently, the provisions of this contract were compared and aligned with various legal regulations, prevailing judicial decisions, and authoritative academic opinions in the field of contract and labor law. At each stage, the research sought to propose the most accurate and contextually appropriate legal characterization of the contractual relationship in question.According to the terms and conditions laid out in the contractual agreement, drivers are classified as independent service providers. They possess autonomy in determining their working hours and bear full responsibility for their own operational expenses, including fuel costs, vehicle maintenance, and repairs. Moreover, driver-partners are directly accountable for the quality of service they render to passengers. These features significantly distance the relationship from that of a traditional employer-employee contract, where the employer typically exerts managerial control over hours, tools, and performance outcomes.Conversely, Snapp’s role is predominantly that of a digital intermediary and facilitator. The company provides the technological infrastructure for the ride-hailing service, processes ride requests via algorithmic matching, manages financial transactions between passengers and drivers, and deducts a predetermined commission from each completed trip. Importantly, Snapp does not exercise direct supervisory authority over drivers, nor does it dictate their schedules or enforce disciplinary measures typical of an employment relationship. A focal point of this research is the examination of existing judicial precedents concerning the legal status of such platform-mediated contractual relationships. Courts have frequently emphasized the absence of direct supervision and the complementary economic subordination of drivers, which collectively underscore the operational independence of these individuals. This judicial perspective supports the contention that the contractual affiliation between Snapp and its drivers is not predicated on hierarchical subordination or economic dependency, which are essential attributes of an employment contract. Furthermore, judicial bodies have consistently construed Snapp’s function as that of a technological enabler rather than a direct provider of transportation services. Such an interpretation reinforces the notion that Snapp does not assume the obligations typically borne by transportation companies, such as direct liability for service delivery or the provision of employment benefits. The findings of this study indicate that the contractual relationship in question cannot be squarely placed within any singular traditional legal category. While it shares certain features with employment, service, and agency contracts, it does not fully conform to the defining characteristics of any of these. Likewise, it cannot be adequately explained through the legal constructs of partnership or usufruct. Rather, it appears to represent a sui generis contractual relationship that blends elements of service provision with principles drawn from the sharing economy and platform capitalism. This unique legal configuration emerges from the specific dynamics of internet-based platforms, where decentralized service provision, algorithmic management, and peer-to-peer interaction redefine the contours of traditional contractual obligations. The relationship between Snapp and its driver-partners exemplifies this shift, as it is predicated not on hierarchical command structures but on flexible, demand-driven cooperation facilitated through digital infrastructure. In conclusion, this research posits that the legal relationship between ride-hailing platforms and their driver-users constitutes a novel form of contractual arrangement. It reflects the evolving nature of work and service provision in the digital era—where contractual autonomy, technological intermediation, and decentralized control challenge the adequacy of conventional legal taxonomies. As such, there is a compelling need for legislative and doctrinal innovation to accommodate the particularities of platform-based work within the broader legal system. This includes the development of new legal frameworks or the adaptation of existing ones to ensure clarity, fairness, and protection for all parties engaged in the emerging gig economy.

Keywords

digital platform
internet taxi
virtual space
snap
platform
Subjects
 
In Persia
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Private Law Research
Volume 13, Issue 50
Spring 2025
Pages 75-116

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