SEVLNn:i'.M II C ON(JKi:SS OI THE RErUBLIC 
OF THE PiniTPIMNES
Second Regular Session
S E N A T E
Senate Bill No.l 
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•17 JUL 19 PI -03
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R L O .lv i I) ;; .
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Introduced by Senator Grace Poe
AN ACT
RECOGNIZINC TRANSPORTATION NETWORK COMPANIES, PRESCRIBING 
REQDIREMEN I S, (iUIDEEINES AND STANDARDS FOR THEIR OPERATION, 
PROVIDING PENALTIES FOR VIOLATION THEREOF, AND FOR OTHER
PURPOSES
Explanatory Note
Transport Network Companies ( I'NCs) have recently emerged as a new mode of 
transportation. Generally, TNCs involve a third-party corporation (such as Uber or Grab) that 
provide clients with smartphone applications which connect them with drivers who transport 
them to their loeation,
TNCs online applications connect passengers with drivers in real time; hence, 
eliminating the uncertainty of waiting for long hours when an available taxi would arrive. 
This has led to TNCs becoming a viable alternative to taxis, which once held point-to-point 
transportation market as a captive market. TNCs have all the characteristics of “disruptive 
innovation”, where a new technology competes with and eventually displaces existing market 
players.
However, TNCs are hounded by their vague legal and regulatory status whenever they 
enter a new market. Aller all, while TNCs and taxis provide similar services, they arc 
markedly different in terms of business model and pricing methodology. As such, regulators 
have struggled with finding the correct regulatory path to take.
The same story applies to the arrival of Uber and Grab in the country. Uber and Grab 
entered the Philippine market in 2015. Subsequently, the Department of Transportation 
(DOTr) issued Department Order No. 2015-011 which introduced Transportation Network 
Vehicle Services (TNVS) as a new mode of transportation in the Philippines. The Land 
Transportation Franchising and Regulatory Board (LTFRl?) issued Memorandum Circular 
No. 2015-017, which sets the guidelines for the acceptance of applications for a Certificate of 
Public Convenience to operate a TNVS. As of December 2016, GrabCar, one of the services 
ot Grab, was reportedly used by more than 1 million users, while Uber reached around 
600,000 users. These numbers attest to the emergence of TNVS as a viable alternative ta 
existing modes of point-to-point transportation.
However, the L'TTRB suspended the processing of applications for TNVS in 2016. 
The LTFRB is currently threatening to impound the vehicles of TNVS operators who do not


have certificates of public convenience. 1 hus. the vague legal and regulatory status of fNVS 
hangs over the heads of TNVS operators and their passengers.
This author believes that Congressional action is needed to resolve the impasse 
regarding the legal and regulatory status of TNVS in the country. Thus, the proposed measure 
seeks to create a separate regulatory framework for TNCs. TNCs are classified as common 
carriers that, by reason of the nature of their business, should observe extraordinary diligence 
in their vigilance over the safety of the passengers transported by them. It also provides the 
requirements for the regulation of I NCs. the standards for their o|x;ralion. and penalties for 
the violation thereof
The undersigned author believes that prudent regulation is necessary for government 
to ensure the highest degree of service for the general public. In particular, all modes of 
transportation, whether traditional or innovative, must be regulated to ensure the safety and 
comfort of passengers; to hold erring or abusive operators and drivers accountable; and to 
ensure that an adequate number of public transportation units are available in all areas.
However, this author also believes that regulation should not stifle innovation, 
especially when the same can alleviate the woes of our general public who struggle with 
traffic congestion every day. Thus, although there is a need for regulation, TNVS is a 
necessity because our country’s public transportation systems continue to remain unreliable.
sought.
In view of the foregoing, speedy approval of this proposed measure is earnestly
I k -
CT POE


SEVEN I EENUI c o n g r e s s o f t h e  REl’LIliLlC 
OF THE I’llIEirriN ES
Second 
Session
S E N A T E
Senate Bill No. 1 f) (J J
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A c in ic
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of ll.r rl i i ftn v
*17 JUL 19 Pl:03
RLCtIVLU u;.
Introduced bv Senator Grace Poe
AN ACT
RECOGNIZINC; TRANSPOR FATION NETWORK C OMPANIES, PRESCRIBING 
REQUIREiMEN I S, (;ilII)EUNES AND S I ANDARDS FOR THEIR OPERA I lON, 
PROVIDING PENAL PIES FOR VIOLA HON IIIEREOF, AND FOR OIIIER
PURPOSES
Be it enacted in the Senate and the House of Representatives of the Republic of the 
Rhilippines in Congress assembled:
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CHAPTER I
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GENERAL PROVISIONS
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SECTION 1. Short Title. - This Act shall be known as the “Transportation Network
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Services Act. "
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SEE riON 2. Declaration of Bo! icy. -  It is the policy of the State to provide and to
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promote adequate and efllcient modes of transportation in the country. To this end, the State
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shall enact measures for the regulation of transportation network services to ensure that the
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paramount interest of the public is protected and conserved, while encouraging free enterprise
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and economic development.
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SIX’! ION 3. Definition of Terms. 
As used in this Act:
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(a) “Board” shall refer to the Land Transportation Franchising and Regulatory Board
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(LTFRB);
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(b) “Rassenger" shall mean an individual who uses a transportation network
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company’s service platform to connect to a driver for transportation network
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services, including all. other persons who accompany said individual, for the
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duration of such service;
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(c) “Rersonal vehicle" shall mean a motor vehicle that satisfies all of the following
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conditions; (i) owned, leased, or otherwise authorized to be used by the driver;
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and (ii) not a public utility vehicle as defined in Republic Act No. 10586 and other
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related laws,
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(d) "Ser\>icc platform” shall mean any internet site or online-enabled application
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software or system that permits the pre-arrangement of transportation network
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services;


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(e) "Transporiaiion network company flNC)" shall mean an organization, whether a 
corporation, partnership, or sole proprietorship operating in the Philippines, that 
provides pre-arranged transportation services for compensation using an internet- 
based application or digital platfonn technology to connect passengers and drivers 
using their personal vehicles;
(f) ‘‘Transportation network driver (TNI)} " shall mean an individual who (i) satisfies 
the requirements provided in Section I 5 of this Act; (ii) pays a Ice to a I NC to he 
connected to a passenger for the purpose of engaging in transportation network 
services; and (iii) operates a personal vehicle to engage in transportation network 
services for compensation; and
(g) “Transportation network vehicle services (TNVS)’’ shall mean transportation of 
a passenger between points chosen by the passenger and that is pre-arranged 
with a TND through the use of a TNC's service platform. I he I'NVS begins 
from the moment the I ND accepts a request for transportation on the TNC's 
service platform and ends when the TND completes the transaction on the service 
platlorm or when the trip is complete and the passenger exits the TND's vehicle, 
whichever is later.
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SIX I ION 4. Nature of Transportation Network Companies and Drivers. 
TNCs
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and TNDs arc governed exclusively by this Act and shall not be subjected to any rate, entry,
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operational, or common earner requirements, other than those requirements expressly set
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forth in this Act.
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TNCs and INDs, regardless of whether their permits are valid and subsisting, are 
hereby declared as common carriers for purposes of determining the liability and degree of 
diligence that must be observed in the course of transportation network services, and the 
presumption of negligence in case of breach of contract of carriage shall likewise appiv to 
them.
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CHAP I KK II
KIvGlILA TION OF IRANPOR FA HON NFTWORK ( OMPAMKS
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SFC TION 5. / \siianee of Termits to TN('s. 
A person, organization, or entity shall 
not be allowed to operate a transportation network companv without first obtaining a Permit 
from the Board upon compliance with the requirements set forth by this Act and other 
reasonable conditions as may be provided by the Board.
SKCTION 6. Application for Permit. 
The Board shall grant a Pennit to a TNC 
upon determination that all of the following requirements are met:
(a) Submission of application in the form prescribed by the Board, fhe application 
shall include the applicant's name, address, tax identification number, and any 
other inlormation that the Board may deem necessary to assess the applicant’s 
qualification;
(b) Proof that the applicant is licensed to do business in the Philippines if the 
applicant is a foreign corporation;
(c) Resident agent for purposes of service of process in the Philippines; and
(d) Payment of an application fee to be set by the Board upon filing of the 
application


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The applicant shall notify the Board of any material change in the information 
included in the application not later than fifteen (15) days after the change occurs. The 
Board shall prescribe a form for the disclosure of material changes.
SECTION 7. lenn and Renewal of Permit. - A Permit issued by the Board shall be 
valid for a period of two (2) years unless sooner revoked by the Board for any of the causes 
provided under Section 23.
The Board shall prescribe the form and requirements necessary for the renewal of a
permit.
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C IIAP I EK III
OPI RAHON OF TRANSPORTATION NETWORK CO.MPANIES
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SECTION 8. Requir ement.s for Transportation Network Companies. - A
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transportation network company shall:
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(a) Create an application process for a person to apply for registration as a
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transportation network driver;
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(b) Maintain an updated database of the TNC’s transportation network drivers;
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(c) Maintain a website with the following information:
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i. 
Ihe fNC's customer service telephone number and/or electronic mail
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add rcss;
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ii. 
The TNC's zero tolerance policy established under Section 9 of this
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Act;
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iii. 
The procedure for reporting a complaint about a TND;
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(d) Conduct, or have a third party conduct, a safety inspection of the personal
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vehicle that a TND will use before the motor vehicle may be used to provide
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transportation network services and ensure compliance with the TNC’s
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vehicle safety policy established under Section 10 of this Act; and
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(e) Maintain an insurance policy as required under Section 1 7 of this Act.
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SECTION 9. Tero Tolerance for Drug or Alcohol Use. - Each TNC shall
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develop and implement a policy prohibiting any TND from using drugs or alcohol or any
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other substance that may render the TND incapable of driving safely while the TND is
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engaged in transportation network services for the TNC or is logged on to the TNC's
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service platform. The TNC shall:
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(a) Establish the complaint procedures for reports of suspected violations of the
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zero tolerance policy;
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(b) Conduct an investigation upon receipt of a complaint that the TND violated
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the zero tolerance policy required under this Section and immediately suspend
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a TND’s access to its service platform for the duration of the investigation;
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and
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(c) Maintain records relevant to the requirements of this Section for the purposes
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of enforcement.
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SECTION 10. Vehicle Safety Policy. - TNCs shall adopt a vehicle safety policy to
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ensure the comfort and security of pa.s.scngers using transportation network services. Such
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policy shall observe the following minimum standards:


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(a) The vehicle must not have a seating capacity of more than ten (10) persons, 
including tlic driver;
(b) The transportation of passengers in numbers exceeding the manufacturer's 
designed seating capacity shall be prohibited, notwithstanding the state's policy 
of encouraging ride-sharing;
(c) The vehicle must be road-worthy and compliant with vehicle emission 
standards but, in any case, not be more than seven (7) years old from date of 
manufacture; and
(d) The vehicle must be equipped with proper tools and equipment
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SECTION 11. l itre Selling uiiil I)isi 
A I NC is hereby authori/cd to set
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fares but shall disclose the fare calculation method, the applicable rates being charged,
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and the option for an estimated fare to a passenger before the passenger arranges a trip
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with a TND. If a TNC utilizes dynamic pricing to incentivize drivers in an effort to
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maximize the supply of available vehicles on the service platform to match the demand
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for rides and increase reliability, the service platform must;
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(a) Provide clear and visible indication that dynamic pricing is in effect prior to
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requesting a trip;
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(b) Include a feature that requires passengers to confirm that they understand that
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dynamic pricing will be applied in order for the trip request to be completed;
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and
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(c) Provide a fare estimator that enables the user to estimate the co.st under
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dynamic pricing prior to requesting the trip.
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SECTION 12. lUcclrnmc Rcn'ipi. 
Within a reasonable time after the
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completion of a tri|>, a TNC shall transmit an electronic receipt to the passenger’s
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electronic mail address or mobile application containing the origin and destination of the
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trip; the total time and distance of the trip; and breakdown of the total fare paid, if any
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SECTION 13. hh-nli/icalion of Transporlalmn Network / Anvers and I’ehieles.
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TNCs shall make available to each prospective passenger, on its service platform, the
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photograph of the I NI) and the license plate number, registration number, and description
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of the I ND’s vehicle. I NDs shall display recognizable external markers on the vehicle at
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all times it is being used to provide trans|X)rtation network services.
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Sl.( riON 14. ( 'onfidenlialil}' of ra.s.senper Information. 
TNCs shall not disclose
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a passenger's personally identifiable information to any other person unless:
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(a) The passenger consents to the disclosure;
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(b) The disclosure is required by a legal obligation, and
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(c) The disclosure is necessary to protect or defend the terms of use of the service
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or to investigate a violation of those terms.
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In addition, a I NC shall be permitted to share a passenger’s name and telephone
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number with a TND for the sole purpose of facilitating communication between the
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passenger and the driver regarding prearranged trips I'NCs shall prohibit the use by TNDs
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ol a pas.sengcr's name, telephone number, or other personal information for anv purpose
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other than those listed in this Section. TNCs shall also prohibit I'NDs from contacting their
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passengers lor any other purpose than securing their location or to discuss other matters
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related to the transportation of the passenger


SIX TION 15. Kcifuircmcnls Jor Iransporlalum Network Drivers. 
may submit an application to a TNC for registration as a TND.
An individual
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(a) Before approving an application, a TNC shall;
(i) Require the individual to submit an application that includes at least all of 
the following:
a. The individual's name, address, and age;
b. Information on the individual’s driver's license;
c. Proof of motor vehicle registration for the personal vehicle the 
individual will use to provide TNVS through the TNC;
d. Proof of availability of an off-street parking space for the vehicle that 
he will use to provide TNVS; and
e. Proof of motor liability insurance coverage as required under Section 
17 of this Act.
(ii) Conduct a review of the individual’s driving history; and
(iii) 
Conduct, or have a third party conduct, a criminal background 
check for the individual.
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(b) A TNC shall not approve an application submitted under sub.section (a) of this
Section and shall disqualify an applicant who:
(i) Is below twenty-one (21) years of age;
(ii) As shown in the criminal background check required under subsection
(a)(iii) of this Section, has been convicted within the past five (5) years of 
any felony;
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As shown in the driving record review required under subsection
(a)(ii) of this Section, has been found to have committed, within three (3) 
years prior to the application, any violation of laws, rules and regulations 
governing land transportation;
(iv) Docs not possess a valid driver's license;
(v) Does not possess proof of motor vehicle registration; or
(vi) Does not possess proof of motor vehicle liability insurance.
(c) A TNC shall permanently disqualify an applicant who
(i) Makes a material misrepresentation in his or her application;
(ii) .Submits falsiUcd documents; or
(iii) lias been convicted for reckless imprudence resulting in serious physical
injuries or homicide.
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A person whose application as I'ND has been approved shall be issued a TND
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Certificate which shall contain the name, address and picture of the driver, and the
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registration plate number of the vehicle that he will use fhe form of the certillcate shall
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be approved by the Board.
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Nothing in this Section shall be interpreted to prevent the LTFRB from imposing
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additional standards.
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SIX I ION 16. Drivers as Imlepeinlenl Coniractors. 
TNDs shall be independent
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contractors and not employees of the TNC if all of the following conditions are met:


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(a) The TNC docs not prescribe specific hours during which a TND must be logged 
into the TNC’s platform;
(b) The TNC docs not assign a TND a particular territory in which to operate;
(c) The TNC docs not restrict a TND from engaging in any other occupation or 
business; and
(d) The TNC and the TND agree in writing that the driver is an independent 
contractor of the TNC
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SIX riON 17. Insurance Reifuircinenls. 
TNCs and I'NDs shall both maintain
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insurance policies to cover claims for incidents involving vehicles and drivers while they
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arc providing transportation network services. The Board shall determine, upon
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consultation with stakeholders, the insurance coverage, including the types of coverage
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and the limits for each coverage that TNCs shall maintain during the validity of their
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permit.
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In every instance where insurance maintained by a TND has lapsed, failed to
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provide the required coverage, denied a claim for the required coverage, or otherwise
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ceased to exist, the insurance maintained by a TNC shall provide the required coverage.
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A TNC shall neither require nor include a hold harmless or indemnillcation clause
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in the terms of agreement with a fND Such clause, if included in the agreement, shall be
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an absolute nullitv
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In the event of an accident, a I ND shall provide insurance coverage information 
directly to interested parties, insurers, and investigating police officers, upon request.
SEC TION 18. Sn ■eel Hails. 
A I ND may not solicit or accept street hails or 
otherwise provide transportation for compen.sation that are not pre-arranged through a 
TNCs service platform.
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SECTION 19. Cush Payments. 
A TND may not solicit or accept cash payments
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or tips over and above the fare calculated by the TNC’s service platform and reflected in
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the electronic receipt required under Section 12.
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SEC’TION 20. hied Service. 
TNCs shall not be allowed to have their own licet
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service or be authori/ed to enter into an agreement with a licet operator to provide
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transportation network services, l or purposes of this Act, a person who operates more than
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one motor vehicle shall be considered a “licet operator” and shall not be registered by the
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TNC with its service platform.
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SEC H O N  21. Ta.x Treatment. 
The Bureau of Internal Revenue shall determine
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the tax liability of TNCs and TNDs and provide the appropriate guidelines for compliance
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therewith.
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C MAPl ER IV 
ENEORC EMENT
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SECTION 22. Reyulalory Authority. 
The authority of the Board shall be
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limited to the issuance of permit to and regulation of TNCs to ensure compliance by


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TNCs with the provisions of this Act. Such authority shall not include jurisdiction t(»
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adjudicate private causes of action arising from the provision of transportation network
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services.
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SKCTION 2J. Disciplinary l>roccc(iinyis. 
The Board, after due notice and
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hearing, may deny an application for a permit, limit, suspend, or revoke a permit if the 
TNC:
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(a) Makes a material misrepresentation in any application filed under this Act or
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rules of the Board;
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(b) f ails to comply with the provisions of this Act or any rule promulgated
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pursuant to this Act;
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(c) Violates any other law that substantially relates to the operation of TNCs;
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(d) Fails to cooperate with the Board, or fails to timely respond to a request for
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information by the Board, in connection with an investigation pursuant to this
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Act. or
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(e) Fails to maintain the qualifications for a permit
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In addition to denial of application or other action under the immediately preceding
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paragraph, the Board may assess against a TNC for each violation enumerated thereunder,
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a fine not exceeding One Hundred Thousand Pesos (PI00,000.00).
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SKC riON. 24. Pciialiu's. 
I he Board shall determine the amount of the 
administratwe penalty to be imposed on a person, firm, corporation or entity found 
violating the prov isions of this Act, after considering the following factors:
(a) The seriousness of the violation or failure to comply, including the nature, 
circumstances, extent, and gravity of the violation, and the hami or injury that 
may arise as a result of the violation;
(b) The history of contraventions of or failures to comply;
(c) The cITorts made to correct the violation; and
(d) Any other factor that may he |ust and reasonable under the circum.stanccs.
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SKC l ION' 25. I'ces and Other Charges. 
The TNCs shall be subject to an
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annual supervision fee, to be determined by the Board and subject to the approval of the
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Secretary of the Department of Transportation. The Board shall promulgate rules and
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regulations governing the collection of such fees, which shall likewise be reviewed
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periodically and any proposed increase shall be published in two (2) newspapers of
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general circulation.
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SKC'I ION 26. Records. 
All TNCs shall maintain pas.scngcr trip records for at
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least one (1) year from the date the trip was completed. TNCs shall also maintain all
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records concerning each TND for at least two (2) years after the date on which the TND
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ceases to engage in transportation network services for the TNC.
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1 he Board shall have the authority to examine the records of TNCs for the purpose
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of enforcement of this Act, including a random sample of the TNCs' records related to 
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prearranged rides and TNDs. Such examinations shall be conducted during working hours
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and shall not occur more than two times per year unless necessary to investigate a
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complaint. Records obtained by the Board pursuant to this Section shall be kept
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confidential, except as may be required by law.


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SEC TION 27. Repnrtorial Requirement. 
A transportation network company 
shall transmit a quarterly report to the Board providing an accounting of the number of 
vehicles it has registered to operate, number of trips provided, estimated number of 
passengers served, gross revenue, and any other information that the fioard may deem 
neeessary for the effective enforcement of this Act.
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C IIAP I ER \ 
FINAE I’ROMSIONS
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SECTION 28, Implementm;.i Rules and Regulations. 
Within sixty (60) days from
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the eifectivity of this Act, the Board shall promulgate the implementing rules and regulations
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as may be necessary to ensure the efficient and effective implementation of this Act.
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SEC.'TION 29. Separahility Clause. 
If any provision or part hereof is held invalid or
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unconstitutional, the remainder of the provision not otherwise alTected shall remain valid and
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subsisting.
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SECTION 30. Repealing Clau.se. 
Any law, presidential decree or issuance,
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executive order, letter of instruction, administrative order, rule or regulation contrary to, or
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inconsistent with, the provisions of this Act is hereby repealed, modified or amended
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accordingly.
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SECTION 31. Effectivity. 
This Act shall take effect after fifteen (15) days
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following its publication in at least two (2) newspapers of general circulation
Approved,