LTFRB orders Grab to explain P2 per minute travel charge

Grab legal counsel John Paul Nabua said that its PHP2 per minute travel charge was in accordance with the order of the then Department of Transportation and Communications (DOTC) in 2015, which allows ride-sharing companies to set their own fares with the oversight of the LTFRB. (Photo: Grab/Facebook)

MANILA — The Land Transportation Franchising and Regulatory Board (LTFRB) has ordered ride-sharing company Grab to explain its fare structure as the board conducted a hearing Tuesday on the supposedly unauthorized PHP2 per minute additional charge.

This as Grab disclosed that it has imposed the travel duration rate since June 2017 despite not being stipulated in an order released last December 27, 2016 by the Board, which set the fare structure of transportation network companies (TNCs).

“The Board directs Grab to disclose and submit when they have actually imposed the PHP2 per minute travel charge and how many trips on a monthly basis Grab has booked from the time they started imposing the charge,” LTFRB Chairman Martin Delgra III said.

The December 2016 order stipulates that Grab should impose a flagdown rate of PHP40 with an additional rate of PHP10 to PHP14 per kilometer excluding per minute travel charges.

“The Board has exercised not only its oversight but also adjudicatory powers when it issued an order last December 27, 2016. The order remains in effect,” Delgra said.

“There was no mention of travel time rate by Grab when the LTFRB came out with an order last December 2016 on the fare structure of TNCs,” he added.

Grab legal counsel John Paul Nabua said that its PHP2 per minute travel charge was in accordance with the order of the then Department of Transportation and Communications (DOTC) in 2015, which allows ride-sharing companies to set their own fares with the oversight of the LTFRB.

“Department Order 2015-11 allows TNCs to determine their rates. Grab started charging the travel duration rate as early as June 2017,” Nabua said.

He admitted, however, that there was no mention of per minute rate in the December 2016 order of the LTFRB.

Grab has presented its fare structure during a technical working group (TWG) meeting with the Board on July last year.

The hearing was conducted after Puwersa ng Bayaning Atleta (PBA) Partylist Rep. Jericho Nograles accused Grab of illegally charging PHP2 per minute for their rides, on top of its flagdown rate of PHP 40 and charging PHP 10-14 per kilometer.

The lawmaker said the ride-sharing firm has ‘unilaterally’ reprogrammed their algorithm to impose the additional charges.

He said that the LTFRB should be the one that should determine the rates that will be set by the TNCs.

“Presentation by Powerpoint does not constitute a fare petition. The presentation of fare structure is not a cause for approval. Would it mean that any instance, a PowerPoint presentation would make it legal already? That’s not what due process is,” Nograles said.

“What we are fighting for here is consumer rights and due process. It turned out that the implementation of the PHP2 per minute in June 2017 did not undergo due process and only underwent Powerpoint presentation,” he added.

Grab should refund around PHP 1.8 billion of alleged illegal charges to its customers, Nograles said.

Partner drivers and operators of Grab that were present in the hearing expressed their concern that the refund would result in the loss of their livelihood.

The next hearing of the LTFRB on the issue is scheduled on May 29, 2018.