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Uber indicted in South Korea two weeks after official launch

CEO Travis Kalanick is named in the indictment, which accuses the ride-sharing service of violating public transportation law.

Uber indicted in Seoul, two weeks after its official launch in South Korea's capital. Pablo Blazquez Dominguez/Getty Image

Uber is facing more heat in Seoul, South Korea, where prosecutors have indicted the car service's local subsidiary with violating a public transportation law, the South Korean Yonhap News Agency reported on Wednesday.

The Seoul Central District Prosecutors' Office also named Uber CEO Travis Kalanick in an indictment for violating a law that prohibits unlicensed entities from providing transportation services, Yonhap reported. The San Francisco-based startup faces a maximum penalty of two years in prison or a fine of 20 million won ($18,126), according to Yonhap.

The indictment comes nearly two weeks after Uber ended a trial period in South Korea's capital and launched as a paid service in the face of repeated warnings from local government officials that the service was deemed illegal.

Official opposition to the service has reportedly led the city's government to offer a bounty to anyone who identifies Uber drivers operating illegally within the city limits. The Seoul government will pay anyone who reports a case of an unlicensed driver carrying paying customers up to 1 million won (a little more than $900), local news outlet Hankyung reported on Tuesday.

See also: Who's really taking you for an Uber ride?

Uber vowed to cooperate with South Korea's legal system, saying it was confident that its service is legal in the country.

"At the same time, Uber does not believe it is appropriate for authorities to seek to punish drivers who are trying to make a living through this service," Uber spokeswoman Evelyn Tay said in a statement.

Uber, which uses a smartphone app to connect riders with part-time drivers of private cars, oftentimes for less than the cost of a traditional taxi or car service, is available in 250 cities around the world. It's speedy growth has not gone unnoticed by government regulators and taxi commissions, many of which have accused Uber of operating illegally by not adhering to the same regulations as traditional taxis.

In addition to being hit with cease-and-desist orders in Pennsylvania and Virginia, Uber suspended service in Nevada and Portland, Ore., in the face of official government resistance. The service was banned from Dehli, India, earlier this month after a passenger was allegedly raped by an Uber driver.

Despite Seoul's outspoken criticism, Uber launched officially in Seoul earlier this month. At the time, the city's government said that while "there is growing support for Uber" in the city, the company must still "abide by the nation's laws." The government has consistently said that Uber violates the country's laws by having drivers essentially rent vehicles to carry passengers.

Uber has argued that its own independent research showed that the car service was heavily supported by Koreans and "is safer than any other mode of transportation in Seoul."