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LTFRB will not process new franchise applications for ride-hailing services

MANILA, Philippines – The Land Transportation and Franchising Regulatory Board (LTFRB) will not process new applications for ride-hailing services permit, and will only process applications that were received as of July 2017.

This was announced by LTFRB Board Member Aileen Lizada in a press briefing on Friday, February 2.

LTFRB said it would work with Transport Network Companies (TNC) Grab, Uber, and U-Hop to complete the database of all drivers applying for provisional authority (PA).

"Current active drivers applying for franchise on March 5 will be prioritized. TNCs will send LTFRB a list of those who should be [present at the LTFRB] to apply for franchise," Lizada said in a mix of English and Filipino.

LTFRB earlier said franchise applications for TNVS would open on Monday, February 5, but was later moved to March 5 to give more time to finalize the list of drivers eligible for franchise.

Lizada said schedules would be set for processing applications, and reminded the drivers to only go to the LTFRB on the date of their application as recommended by the TNC.

"If you are not on the list, don't go to LTFRB for the permit applications," she said in Filipino.

Lizada also said hatchbacks and other compact or smaller sedans are allowed to apply as long as fare rates must be lower than sedans. She added that hatchbacks will only be allowed to operate as Transport Network Vehicle Services (TNVS) within Metro Manila, and this classification will reflect on their Certificate of Public Convenience.

Cap on permits

LTFRB earlier set a cap on TNVS permits at 45,700 units nationwide. This sparked a debate among TNCs on whether it is the right number of units based on the demand. (READ: Poe to LTFRB: 'Explain the math' behind cap on ride-hailing vehicles)

Based on the data submitted by Grab and Uber to LTFRB, Lizada said, only 150,000 to 180,000 of the requested 350,000 to 400,000 bookings made under Uber were served.

Meanwhile, Grab was only able to serve 270,000 to 290,000 of the 320,000 to 380,000 bookings during weekdays. (READ:Grab, Uber riders only a minority – LTFRB)

The Department of Transportation then ordered the LTFRB to review the cap imposed by the LTFRB.

Don't buy those cars yet

Lizada said the regulatory board sees the need to evolve as technologies innovate. She said, however, that the government's mandate is to regulate, and cautioned drivers against buying new cars to apply for TNVS permits.

"We see the innovations, the needs of riders evolve. What government is doing is adjusting and seeing how we can fit as well. We do this because many might buy cars again. Don't buy cars for TNVS anymore. Let's cut it off," she said.  

In 2016, LTFRB suspended acceptance of new applications for TNVS permits for ride-hailing apps due to the rising volume of applications and concern of oversupply of units.

The LTFRB imposed a P5-million fine each on Uber and Grab in July 2017 for allowing its drivers to operate without permits. (READ: What's the fuss about the Grab, Uber regulation issue?)

Uber was suspended in August 2017 after it repeatedly defied the board's order to stop taking new drivers into its system. It paid a fine of P190 million. (WATCH: How Uber got suspended and why it matters) – Rappler.com

Aika Rey

Aika Rey covers the Philippine Senate for Rappler. Before writing about politicians, she covered budget, labor, and transportation issues.

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