Grab acted in ‘good faith’ on P2-per-minute charge: LTFRB exec

“Facts would show that the basis of the respondent in prescribing the per-minute charge was Department Order No. 2015-011. Additionally, the assailed PHP2-per-minute charge was communicated to the Board, through the Office of the Chairman. Emphasis is made that the PHP2 per-minute charge was set when Department Order No. 2015-011 was not yet amended,” Lizada said. (PNA Photo)

MANILA — Ridesharing firm Grab Philippines acted in good faith when it imposed the PHP2-per-minute charge on its riders, an official of the Land Transportation Franchising and Regulatory Board (LTFRB) said.

In her dissenting opinion dated last July 9, LTFRB Board Member Aileen Lizada said the per-minute charge was imposed before the Department of Transportation (DOTr) issued Department Order No. 2017-011 or the Omnibus Franchising Guidelines for Public Utility Vehicles on June 19, 2017.

The order authorizes the LTFRB to determine the fare structure of transportation network vehicle services (TNVS).

“Facts would show that the basis of the respondent in prescribing the per-minute charge was Department Order No. 2015-011. Additionally, the assailed PHP2-per-minute charge was communicated to the Board, through the Office of the Chairman. Emphasis is made that the PHP2 per-minute charge was set when Department Order No. 2015-011 was not yet amended,” Lizada said.

The Board order fines Grab PHP10 million for overcharging and to reimburse the per-minute charge through future ride bookings of its passengers.

“Thus, in the imposition of any administrative sanction, the Board must only do the same after the effectivity of Department Order No. 2017-011. Said issuance should be applied prospectively and not retroactively. However, if after thorough evaluation and investigation, respondent will still impose the per-minute charge after the effectivity of the said Department Order, then and only then can the Board impose the appropriate penalty. Simply stated, penalties should be imposed upon effectivity of the regulatory policy,” she added.

Grab has reiterated that the PHP2-per-minute travel charge is legal, adding that it is deliberating on its next legal moves regarding the LTFRB order.

“But no matter how we decide to move forward from this, be assured, Grab will stay,” Grab country head Brian Cu said in a statement posted on his Facebook page.

Department Order No. 2015-011, which was issued by the then Department of Transportation and Communications (DOTC), authorizes transportation network companies to set their own fares subject to the oversight of the LTFRB.

The per-minute charge was imposed by Grab from June 2, 2017 until April 19 this year, when it was suspended by the LTFRB.

The LTFRB, in its order dated July 9, said the rebates should be availed of for only 20 days from the time the decision becomes final or when Grab starts its implementation.

“The amount of the rebate shall be limited to the portion of the income of the respondent only, directly related to or arising from the PHP2-per-minute during the period of its unauthorized imposition,” according to the Board.

Grab may be able to file a motion for reconsideration within 15 days upon release of the order and may appeal to the DOTr in case this was denied.

The LTFRB has previously said there was no mention of any travel time rate, which Grab has been collecting, when it released its order on the fare structure of TNCs in December 2016.

The order states that Grab should impose a flag-down rate of PHP40 with an additional rate of PHP10 to PHP14 per km., excluding per-minute travel charges.