Uber started charging a fee last year for the taxi-like service, which matches passengers via a smartphone app with private drivers who do not hold commercial transport licenses.
Prosecutors subsequently indicted Uber's chief executive, Travis Kalanick, as well as its South Korean unit for violating a law prohibiting individuals or firms without proper commercial licenses from providing or facilitating transportation services.
"We want to actively work towards a consensus, and the first step to that process is switching off the fare," Uber's head of north Asia Allen Penn said in a statement.
Uber proposed a new registration system for its drivers in South Korea earlier this month in a bid to operate legally. But the transport ministry rejected the proposal and said it would stop the company offering its services.
Uber has been the subject of similar regulatory ire in countries around the world, even as it expanded into more than 290 cities.
In January, the city of Seoul declared Uber's services illegal and started offering rewards of up to 1 million won ($911) for people who reported private drivers providing transport through the company.
Yang Wan-soon, director of the Seoul city government's taxi and logistics division, told Reuters it is up to the courts to decide whether Uber can operate legally.
"The city also needs to consider whether the free taxi service would disrupt existing market order," Yang said.
© Thomson Reuters 2015
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