Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
18™ CONGRESS
First Regular Session

House Bill No. 5807

Introduced by REP. EVELINA G. ESCUDERO

EXPLANATORY NOTE

Undoubtedly, history’s recent technology of immense and profound importance is the
internet. It changed the lives and habits of this generation- young and old. It forever changed the
way we access information, entertain and express our ourselves, interact with people, and find
solutions to our mundane and complex problems.

One of the modern innovations that exploited the power of the internet is the internet
enabled transportation service or Transport Network Vehicle Service (TNVS) of the Transport
Network Companies (TNCs). With this service, a commuter no longer has to be out in the street
at any time to be able to hail a vehicle for a ride. He or she only has to open the TNC application
on his or her mobile phone, tap the point of pick up and point of destination and he or she
instantly knows when the vehicle will arrive and how much the fare will be.

Thus, the service turned out to be very popular and heavily patronized by the commuting
public as it is efficient and convenient.

Differently put, the TNCs have responded to the transport predicament of ordinary
commuters in a novel way that may or may not however fit in the traditional mode of State
regulation. As State regulators had been seemingly caught unprepared to deal with this transport
innovation, they grappled with the issue of regulation. With the public’s overwhelming support
of the transport service, the State regulators have had little choice but to embrace the same and
adjust and adapt its system of regulation, albeit progressively in phases.

Engaged in the operation of a public utility and imbued with public interest, the
Department of Transportation nonetheless issued Department Order (DO) No. 2018-013!
mandating the Land Transportation Franchise and Regulatory Board (LTFRB) to regulate TNCs

D.O. No. 2018-013, “Authority of the Land Transportation Franchise and Regulatory Board to Regulate the Transport Network
‘Companies (TNCs) and Transport Network Vehicle Service (TNVS) operators.” Issued on June 11, 2018,


and TNVS and to determine the fares for the TNVS. However, repeated claims of overcharging
of these TNCs and TNVS remain. Moreover, there appears to be no clear process of refund in
case of overcharging.

Consequently, amidst these overcharging issues, this Bill seeks to legislate the powers of
the LTFRB as provided in the above DO by giving it the specific statutory mandate to determine
fare rates and adopt a system of refund so as to fully protect the interest of the riding public.

Needless to state, it is submitted that this proposed measure can serve as a viable platform
to discuss and deliberate with the end in view of striking a reasonable balance between the rights
and interests of the riding public, on one hand, and the various TNVS and TNCs, on the other —
and ultimately arrive at the appropriate State policy to be taken and approved by Congress.

RESPECTFULLY SUBMITTED.

Aawete)


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
18™ CONGRESS
First Regular Session

House Bill No. 5807

SSS

Introduced by REP. EVELINA G. ESCUDERO.

AN ACT
TO REGULATE THE FARE RATES OF TRANSPORT NETWORK COMPANIES AND
TRANSPORTATION NETWORK VEHICLES SERVICE.

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

ARTICLE I
GENERAL PROVISIONS

SECTION 1. Short Title. - This Act shall be known as the "Transport Network Vehicle
‘Service and Transport Network Companies Regulation Fare Rates Act of 2019.”

SEC. 2. Declaration of Policies. - It is hereby declared the policy of the State to protect
and promote the right of all citizens to a safe, accessible and affordable means of transportation
by regulating public transport services, specifically the fare rates of Transport Network Vehicle
Service (TNVS) and Transport Network Companies (TNCs) which must always be reasonable to
all commuters.

SEC. 3. Scope of the Act. - This Act seeks to regulate the fare rates of all Transport
Network Vehicle Service (TNVS) and the Transport Network Companies (TNCs) as defined in
Section 4 of this Act.

SEC. 4. Definition of Terms. —
a.) Transport Network Company (TNC). ~ Refers to a person or entity that provides pre-

arranged transportation services for compensation using an internet-based technology application
or digital platform technology to connect passengers with drivers using their personal vehicles.?

? Section 1, D.O. No. 2018-013.


b.) Transportation Network Vehicle Service (TNVS). - Refers to a TNC-accredited
private vehicle owner, which is a common carrier, using the intemet-based technology
application or digital platform technology transporting passengers from one point to another, for
compensation.?

SEC. 5. Regulation and Supervision. - TNCs and TNVS are subject to the full
regulation and supervision by the Land Transportation Franchising and Regulatory Board
(LTFRB), specifically in the standardization of fare rates, system of refund in case of
overcharging and adjustments of such standardized fare rates.

SEC. 6. Fare Rate Determination and Adjustment. - The fare rates for TNVS shall
be determined and adjusted by the LTFRB taking into consideration the following:

a) — Make/Type of the vehicle;
b) Year model;

c) Time of service; and

4) Distance covered.

In the determination of such initial rates, the LTFRB shall conduct public hearings as
may be deemed necessary in consultation with TNCs, TNVS, the concerned drivers and all
other stakeholders. The LTFRB shall ensure that the public and stakeholders are duly
notified of such hearings indicating the date, time and place at least three (3) days before the
scheduled hearings.

SEC. 7. Refund. — The LTFRB shall likewise provide for a system of refund in cases
of overcharging of TNCs and TNVS, as the case may be, which shall accommodate a
convenient and effective refund process to commuters. A convenient and effective refund
process shall mean the actual or physical return of the overcharged amount to a commuter
within five (5) days from date the claim for refund is made.

SEC. 8. Penalties. - Any violation of the provisions of this Act shall result in the
imposition of fines, suspension, and cancellation of accreditation, subject to notice and
hearing.

SEC. 9 Implementing Rules and Regulations (IRR). - Within ninety (90) days from the
date of effectivity of this Act, the Department of Transportation through the LTFRB shall
promulgate the necessary implementing rules and regulations for the effective implementation of
this Act.

SEC. 10. Repealing Clause. — All laws, decrees, executive orders, rules and regulations
or parts thereof not consistent with the provisions of this Act are hereby repealed or modified
accordingly.

> Section 2, D.O. No. 2018-013.


SEC. 11. Separability Clause. - If any provision or part of this Act, or the application
thereof to any person or circumstance, is held unconstitutional or invalid, the remainder of this
Act shall not be affected thereby.

SEC. 12. Effectivity Clause. - This Act shall take effect fifteen (15) days from the date of
its complete publication in the Official Gazette or in at least two (2) newspapers of general
circulation.

Approved.