‘Colorum’ Uber, Grab vehicles may continue operating pending final verdict
Existing “colorum” transport network vehicle services (TNVS) under Uber and Grab Philippines may continue to provide services pending the final resolution of the transport impasse with the Land Transportation Franchising and Regulatory Board (LTFRB).
Sen. Grace Poe, chairman of
the Senate Committee on Public Services, disclosed this after a closed-door meeting with the LTFRB, and transport network companies (TNCs) Uber and Grab on Wednesday.
After the meeting, both camps agreed that Uber and Grab will file a motion for reconsideration asking the LTFRB to suspend its moratorium against TNCs operating without any permits.
“During our meeting, the parties were able to agree that one, they will continue with the TWGs (technical working group) next week, in order to find a win-win solution for both government and the TNCs,” Poe told reporters after the meeting.
Poe said Grab and Uber have also agreed to share their data with the LTFRB so that the LTFRB, in crafting guidelines, will consider the actual number of TNVS on the road and not just the number of TNVS that have been accredited.
But the LTFRB will push through with executing their memorandum circular which will start on July 26, 2017.
“Although the LTFRB will push through with executing their memorandum circular, they will allow the TNCs to file their motion for reconsideration and pending the resolution of the latter, will allow existing ‘colorum’ TNVS to continue providing service,” Poe said.
At the same time, Poe appealed to the public to allow the LTFRB to do its mandate.
“Let us allow the LTFRB to do its job. They have to regulate common carriers to ensure accountability and to prevent the ‘dynamic pricing scheme’ of TNVS from overcharging passengers during peak hours,” Poe said.
“On the other hand, government must be forward-looking. Ride-hailing services are now a necessity because these provide the comfort and reliability that many of our people look for in public transportation,” she said. Bills filed Consequently, Poe also filed Senate Bill No. 1501 or the Transportation Network Services Act, which will institutionalize and regulate ride-hailing services.
Davao City 1st district Rep. Karlo Alexei Nograles and his brother, Puwersa ng Bayaning Atleta (PBA) PartyList Rep. Jericho Nograles also filed House Bill No.6009 to put an end to the controversy surrounding the LTFRB’s suspension of some Uber and Grab vehicles due to the absence of a legal framework that would categorize TNCs as a public conveyance.
Also known as the proposed Transportation Network Service Act, the measure seeks to institutionalize the TNCs as an alternative mode of public transport and provide the regulations for the operation of transportation network services “to ensure that the paramount interest of the public is protected and conserved, while encouraging free enterprise and economic development.”
Sen. Joseph Victor “JV” Ejercito, vice chair of the committee, who had earlier called for the meeting said he was glad that both parties were able to thresh out their issues against each other.
Both the LTFRB and TNCs have agreed to participate in future hearings when called.
“But of course, there is still a need for us to understand the position of the LTFRB. It’s a government regulatory arm, so they still need to ensure everything is in order,” the senator added.
More violations uncovered
The Senate meeting came as the LTFRB uncovered more violations of Uber and Grab.
It said that two thirds of the 32,000 pending applications of transport network vehicle services (TNVS) were dismissed due to non-compliance with the mandated requirements.
The board approved only around 3,000 applications.
Aside from this, the LTFRB also uncovered that numerous names of drivers submitted by Uber did not have matching case numbers and actual registered drivers under the board.
While expressing support for the technology, LTFRB Chairman Martin Delgra III clarified that the board has not singled out the TNCs, insisting that they should not be treated differently like other public utility vehicles (PUV).
LTFRB board member and spokesperson, lawyer Aileen Lizada, said transport giants Uber and Grab have already earned millions of pesos for allowing 30,000 out of the 56,000 drivers to operate even if they have not been registered with the board.
“To Grab and Uber, do not come to us now to solve your mess,” Lizada said.
Delgra and Lizada pinned the blamed on the transport giants, citing that the mess began because of Grab and Uber.
The LTFRB chief suspected that the TNCs may have intentionally withdrawn from informing their “partner drivers” to secure their franchise from the LTFRB before operating.
In her visit last July 17, Lizada said that personnel at the Uber registration office confirmed that they continue to allow new drivers to operate despite obvious violations.
The controversy started when the LTFRB issued an order on July 21, 2016, stopping the franchising board from giving out provisional authority permits.
With the order, the TNCs were unable to lawfully hire new drivers prompting Grab and Uber to defy the directive to accommodate the rising “public demand” for their services.
Eventually, the LTFRB imposed a P5-million penalty each to Uber and Grab setting July 26, 2017 as the deadline to rid their fleet with colorum drivers.
Transport crisis
Meanwhile, Senate President Pro Tempore Ralph Recto expressed belief Malacañang should treat the grounding of Uber and Grab cars in Metro Manila as a “transport crisis” comparable to a “total MRT breakdown or a paralyzing jeepney strike.”
Recto said this should prompt the Palace to step in: “In a mass transport-starved metropolis of 13 million, these ride-hailing companies provide a crucial service.”
“In terms of carrying capacity, these two exceed MRT’s daily ridership of 500,000,” Recto said.
“If the impasse drags on, the Palace has no choice but to intervene,” the senator said.
Recto said there is also a need to know whether drivers of these ridesharing applications are getting the right incentives and if their welfare is also taken into account by Uber and Grab.
“Are they getting the right incentives? There is chatter in social media on how they sometimes get the short end of the stick.”
“Uber is a multinational TNC. With one swipe of a card, it instantaneously gets 25 percent of the fare. Money that is automatically repatriated to them,” he said.
Sen. Paolo “Bam” Aquino IV said he is happy LTFRB, Grab and Uber have reached an immediate compromise during the meeting.
“Now we can focus on a long term solution to ensure that the riding public is protected. I urge my colleagues in Congress to look at our filed ridesharing network bill and help us push for its passage,” Aquino said.
“I am hopeful that, if all stakeholders work together, we can come up with regulations which are favorable to our commuters,” he added.
‘Highly irregular’
As this developed, the Bureau of Internal Revenue (BIR) described as “highly irregular” the directive of the LTFRB to TNVS operators to include, among others, income tax returns (ITRs) in their franchise applications.
Tax lawyers said the BIR does not issue ITR to new business registrants like TNVS as they are just starting their operations and no income to report yet.
They said ITR is only available to TNVS and other transport operators when they apply for the renewal of their franchise.
Transport operators are required to pay income tax and three percent common carriers tax on gross earnings.
Revenue officials came out with the explanation following the announcement of LTFRB not to accept the franchise applications without ITR among others.
But Lizada said including the ITR as a requirement for franchise application is necessary to determine the financial capacity of the TNVS operators.
However, in lieu of the ITR, particularly in the case of new business registrants, Lizada said other documents or proof of the applicants’ financial capability to run the transport network service trade will suffice. (With reports from Jun Ramirez and Ellson A. Quismorio)