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MANILA, Philippines – inDrive, a potential newcomer to the ride-hailing industry, was suspended by the Land Transportation Franchising and Regulatory Board (LTFRB) for violating the agency’s established fare matrix by allowing passengers to haggle rates.
About a month after officially accrediting the new ride-hailing app as a transport network company, the LTFRB has now halted inDrive’s operations.
“The suspension comes in response to alleged violations concerning the haggling of fares, a clear breach of the terms and conditions outlined in its accreditation as a transportation network company,” LTFRB Chairman Teofilo Guadiz III said in a statement on Tuesday, January 23.
The LTFRB ordered inDrive to stop its operations starting Tuesday until it can present proof of compliance. The company has 15 days to comply.
The LTFRB issued the suspension order against inDrive after a hearing on Tuesday. It previously issued a show cause order against inDrive regarding the company’s fare-haggling system.
“Haggling of fares not only goes against the principles of transparency but also jeopardizes the welfare of both passengers and drivers. We take these allegations seriously and are conducting a thorough investigation to determine the extent of the violation,” Guadiz added.
Two days after the LTFRB suspended inDrive, the company released a statement acknowledging the order.
“During our recent engagement with the LTFRB, productive discussions transpired and we are now in the process of further developing our application to ensure that there is no confusion amongst our users and that they experience the best possible service,” inDrive said in its statement on Thursday, January 25.
“As part of these ongoing improvements, we will be temporarily pausing our service operations. This is a necessary step to ensure that our enhancements are implemented effectively and align with both our users’ needs and regulatory standards.”
Lawyers for Commuters Safety and Protection president Ariel Inton, who was present in Tuesday’s hearing as the counsel of the complainants, told Rappler that the LTFRB “was not satisfied” with the explanation of inDrive when asked about the allegations of fare haggling.
“Sa kanilang paliwanag, lumalabas na they admitted na talagang meron silang fare haggling (In their explanation, it appeared they admitted that there really is fare haggling),” Inton told Rappler.
“There is nothing in the memorandum circular of the fare matrix of the LTFRB na puwede kang mag-haggle ng [fares] (that you can haggle fares). The fares for TNVS (transport network vehicle services) are provided for in the fare matrix.”
Metro Manila operations
Prior to the suspension order, inDrive was positioning itself to make a splash as a competitor to Grab. In December 2023, the company sent out a press release announcing that it had been accredited by the LTFRB and that it would start operations soon.
inDrive did not give a specific date for its official launch, but a company representative told Rappler that they were focusing on recruiting drivers before piloting services in the cities of Baguio, Iloilo, Cagayan de Oro, Butuan, and Bacolod. In a new press release sent out just hours before the LTFRB decision came out, inDrive said it would soon “activate its services in Metro Manila this first quarter of 2024.”
However, Inton told Rappler that inDrive has already been offering its services in Metro Manila. He cited instances where complainants used the inDrive app to book a ride in Metro Manila, only to be surprised that a taxi – and not a TNVS vehicle – was the one that arrived.
“’Yung complainant ko, pinakita doon na when he booked a ride, taxi dumating. He was surprised. ‘Di naman taxi ‘yung binook niya,” Inton said. “So ‘yung sinasabi ng inDrive na nagre-recruit pa lang sila is a total lie. Nakaka-book na sila sa Metro Manila.”
(My complainant showed that when he booked a ride, a taxi came. He was surprised. He didn’t book a taxi. So what inDrive is saying, that they’re just recruiting, is a total lie. You can already book in Metro Manila.)
inDrive also ended up in hot water in January 2023, which was around the time that it first filed its application for accreditation with the LTFRB. Back then, the LTFRB slammed what it called two unaccredited “Russian ride-hailing services” – which were inDrive and Maxim – for operating in the Philippines illegally. – Rappler.com