Uber, Grab failed to inform drivers of LTFRB requirements

The Land Transportation Franchising and Regulatory Board (LTFRB) has come out swinging against transport network companies (TNCs) Uber and Grab, saying it was being unfairly painted as the villain for its decision to go after app-based drivers operating without the required franchises starting on July 26.

On Tuesday, LTFRB chair Martin Delgra III stressed that Uber and Grab drivers would not be in a predicament had the two TNCs followed the rules set by the transport board last year when it imposed a moratorium on the applications for transport network vehicle services (TNVS).

Grab and Uber, Delgra said, did not inform their driver-applicants of the moratorium. He added that the TNCs also did not inform applicants that they were required to go to the LTFRB to get either a provisional authority (PA) or a certificate of public conveyance (CPC).

While franchises are being processed, the LTFRB issues the applicant a PA valid for 45 days. Once a CPC is released, it is valid for a year and can be renewed with the transport board.

“The board and the government fully support the ride-sharing technology. What we don’t want is the TNCs violating the law rampantly and openly to the prejudice of the [drivers],” Delgra told reporters yesterday. “Don’t turn the commuters against us because it is a mess that you [TNCs] created,” he added.

In July last year, the LTFRB issued Memorandum Circular No. 2016-008 suspending the acceptance of TNVS applications pending a review of policies covering the system such as accountability and pricing mechanisms.

At that time, the LTFRB had around 32,000 pending applications but now, the two TNCs said they have 56,000 drivers on their platforms. Around only 3,700 hold valid franchises.

This meant that despite the moratorium, Grab and Uber still accredited and included in their platforms over 20,000 drivers. LTFRB board member Aileen Lizada said that the TNCs should be the ones drawing flak for “failing to do their job” and putting their drivers at risk of being declared “colorum” (without a valid franchise) operators.

She added that during a visit to an Uber office on Shaw Boulevard on Monday, she found out that the company was still activating drivers on its platform despite the LTFRB’s order last week to crack down on those without a PA or CPC.

“To both Grab and Uber, do not come to us now to solve your mess. Do not turn to us to make legal what you have done illegally. That is not the right thing to do,” Lizada said.

Sought for comment, Uber said that starting Wednesday, it “would defer activation of new applications.”

“But please keep in mind that our riders will be most affected. And each day the suspension remains in place, hundreds of Filipinos will be prevented from earning an income,” Uber said in a statement.

On criticisms that the LTFRB did nothing over the past year with the pending applications of Grab and Uber drivers, Delgra said that two-thirds of the 32,000 applications had been dismissed, mostly because the drivers did not appear before the agency.

Based on their estimate, Lizada said that Uber alone has earned at least P168 million from the P6,000 processing fee it got from its 28,000 drivers. She added that Uber earned another P75 million monthly from its 25 percent share of the drivers’ income.

Grab, on the other hand, is estimated to have earned P60 million monthly from its 20-percent share of drivers’ income.

Delgra said a technical working group would convene today to iron out issues affecting the TNC industry.