LTFRB OKs ridesharing firms’ P2/minute charge

MANILA, Philippines — The Land Transportation Franchising and Regulatory Board (LTFRB) has issued an order allowing all ridesharing companies to charge P2 per minute of travel time.

Under Memorandum Circular No. 2018-019 dated Sept. 4 and released yesterday, transport network vehicle services (TNVS) are now authorized by the board to charge P2 per minute of travel time from origin to destination as part of the fare structure.

This is the first memorandum by the LTFRB on the standard fare structure applicable to TNVS units.

The P2-per-minute charge can apply to all types of TNVS vehicles, including sedans, six-seaters, sport utility vehicles and sub-compact cars.

The electronic receipt should be “unbundled” to reflect the breakdown of the fare to include the flagdown rate, per-kilometer rate, travel time rate as well as surge prices. 

The LTFRB noted that this authorization “shall be without prejudice” to the final resolution of the pending cases of Grab and Hype Transport Systems Inc.

The two transport network companies (TNCs) are facing cases before the LTFRB for allegedly imposing the charges without authority.

The LTFRB has already ruled that Grab should pay a P10-million fine for imposing the charges without authority from the body despite an order.

On Monday, the LTFRB partially granted the appeal of Grab and reversed its ruling requiring the ridesharing company to reimburse the P2-per-minute fee it charged passengers from June 2017 to April 2018.

Hype has been summoned to explain why its accreditation should not be suspended or canceled for allegedly charging P2 per minute of the trip “without authority from the board.”

The issue surrounding the per-minute charge of TNVS came about as Rep. Jericho Nograles alleged that Grab was illegally imposing the charge and was able to amass at least P1.8 billion in illegal fares from its passengers.

The LTFRB decision will take effect 15 days after its publication in newspapers of national circulation.

Grab welcomes LTFRB decision

Grab Philippines yesterday welcomed LTFRB’s decision in favor of its suspended P2-per-minute charge.

“LTFRB’s recent order to partially grant Grab’s motion for reconsideration – by reversing and setting aside its earlier direction to reimburse fares due to lack of legal basis – is a welcome outcome that we are grateful for, and supports the fact that Grab acted in good faith and did not do anything illegal,” Grab Philippines country head Brian Cu said in a statement.

“We maintain that Grab merely followed the Department of Transportation’s DO 2015-011 that allowed TNCs to set their own fares with oversight from the LTFRB at that time,” Cu added.

Grab will exhaust all administrative and legal measures until the decision is overturned or resolved with finality, according to Cu, as his firm continues to urge the LTFRB to lift the suspension

“This has forced a number of them to stop driving which, in turn, gravely affected the supply situation. Thus, the lifting of the suspension of the P2-per-minute fare component will make our TNVS partners see a path towards more sustainable income and will help end the wait for passengers who deserve a ride when and where it is needed,” Cu said.

“We respectfully ask the Board to immediately restore the P2-per-minute time component, so that TNVS partners who went offline will be encouraged to go back and help address the TNVS supply crisis. This will also encourage active drivers to continue serving the growing passenger demand,” he added. – With Richmond Mercurio