LTFRB: Hype overcharging, too; P2/minute rate unauthorized

The Land Transportation Franchising and Regulatory Board (LTFRB) has ordered another transport network company (TNC) to explain why it was overcharging passengers.

In a show-cause order issued on July 13, the LTFRB questioned why Hype Transport Inc. was charging passengers a P2-per-minute travel rate without the board’s approval.

Hype was one of the five TNCs accredited by the LTFRB earlier this year, along with Hirna, Owto, GoLag and MiCab. Their entry was seen as a challenge to Grab’s virtual monopoly of the ride-sharing industry following its acquisition of Uber’s Southeast Asia operations.

If found to have violated the LTFRB’s rules on fare regulation, Hype could face the same fate as Grab which was fined P10 million last week for making a unilateral move to charge the same fee.

Submitted fare schedule

In its original fare component schedule submitted to the LTFRB, Hype declared a base fare of P40 as well as a P13.50- to P14-per-kilometer rate for both its HypeTaxi and HypeSedan.

The TNC also declared a surge rate of up to 1.5 times during peak hours, but there was no mention of a P2-per-minute travel rate.

However, travel receipts issued by Hype to passengers who complained to the Lawyers for Commuters’ Safety and Protection (LSCP) showed that the breakdown included the P2-per-minute travel fee on top of base and distance rates.

It was unclear whether Hype started charging the rate before Department Order 2015-11—which allowed TNCs to impose their own fare structures subject only to LTFRB oversight—was rescinded in June.

Before it was fined, Grab argued that the department order authorized it to set its own fares. However, Grab was overruled when the LTFRB said it was the only one that could “determine, prescribe and fix rates” under Executive Order No. 202 and Commonwealth Act No. 146.

The order penalizing Grab was signed by LTFRB Chair Martin Delgra and Board Member Ronaldo Corpuz.
Aileen Lizada, the other board member, dissented, upholding that TNCs indeed had the right to set their own fares under the department order.

Same punishment sought

Ariel Inton, former LTFRB board member and LCSP chair, said that Hype should be punished “in the same way” as Grab should it be found to have overcharged passengers.

In a statement, Hype said it was one with the LTFRB in the aim of providing quality choice for the riding public. “We assure the public that Hype is transparent and abides by the law, and rules and regulations concerning TNCs.”