The same day, a new law comes into force that allows the Hungarian authorities to block “a provider of taxi services operating without a proper dispatch centre” for up to one year.
An Uber statement said that the legislation passed by parliament last month “makes it impossible for Hungarian drivers, in spite of having licences and properly paying taxes, to use their own vehicles to make money”.
The US company has become one of the world’s most valuable startups, worth an estimated $50 billion (44 billion euros), as it has expanded to more than 50 countries including 21 EU member countries other than Hungary.
But it has faced regulatory hurdles and protests from established taxi operators in most locations where it has launched.
Since Uber entered the Hungarian market in November 2014, around 1,200 drivers and 160,000 riders have registered with the company.
The new law followed months of protests by licensed taxi drivers who complained that orders have been decreasing sharply.
They say Uber drivers — who often charge significantly cheaper fares — should be subject to the same stringent rules regulating official cabs.
The company’s head in Hungary told AFP on Wednesday however that the legislation “punishes innovation, is disadvantageous to both competition and consumers, and provides no advantage to the state”.
“On several occasions we signalled our willingness to help put together a modern set of regulations, but there was no interest for that,” said Zoltan Fekete.
Uber hopes one day to restart its service in Hungary, said Robbie Khazzam, the firm’s boss in Central Europe.
“Hungary stands out as the exception and not the rule,” he told AFP. “We are definitely not giving up on Hungary.”