NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
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•22 JUL 12 PI :29
SENATE
S. No.
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INTRODUCED BY SENATOR JOSEPH VICTOR "JV" G. EJEROTO
AN ACT
RECOGNIZING TRANSPORTATION NETWORK COMPANIES AND DRIVERS, 
PRESCRIBING REQUIREMENTS, GUIDELINES AND STANDARDS FOR THEIR 
OPERATION, PROVIDING PENALTIES FOR VIOLATION THEREOF, AND FOR 
OTHER PURPOSES
EXPLANATORY NOTE
Commuting in the Phiiippines, most specialiy in Metro Maniia is tough. Workers, 
employees, students who rely on mass transportation or those who have private cars 
share the same problem every single day. Traffic congestion, lack of sufficient public 
transportation and transportation infrastructure contributes to the worsening situation 
in the country. The Japan International Cooperation Agency (JICA) in 2018 projected 
that the daily economic cost of traffic will surge to P5.4 billion if no government 
interventions will be made.
On May 8, 2015, the Department of Transportation and Communications 
(DOTC), issued Department Order No. 2015-011 recognizing the need for additional 
mode of public transportation to further promote mobility. The DOTC started to give 
accreditation of applicants of Transportation Network Vehicles Service (TNVS) In order 
to offer their services to the public.
In the 2018 online survey made by Research and Tech Lab (RTL) regarding the 
most preferred transport medium in Metro Manila showed that 46.47% choose TNVS, 
24.46% go for taxis, 11.91% takes the bus, 11.01% ride the train (MRT,LRT,PNR)


and 6.15% choose UV Express.1 Indubitably, with the introduction of TNVS in the 
country, it made Filipinos to go for convenience and comfort - for a less hassle 
commute and value for money fares.
With the increasing number and demand for TNVS, on June 11, 2018, the 
Department of Transportation issued Department Order (DO) No. 2018-013, which 
mandated for the Land Transportation Franchising and Regulatory Board (LTFRB) to 
regulate the Transportation Network Companies (TNCs) and TNVS. The Department 
Order specified the powers of the LTFRB in the regulation and supervision of the TNCs 
and TNVS, specifically the approval and denial of franchise, setting of fares, routes 
and operating conditions, and the imposition of fines, suspension and cancellation of 
franchise.2 In the same way, the Department Order classified TNCs and TNVS as public 
utility and thus subject to the full regulation of the State.
Currently, the LTFRB has approved the operation of five TNVS, namely Grab, 
Joyride, TokTokgo, OWTO and ePickMeUp. In the latest number released by the 
LTFRB, there are 26,301 TNVS operating in the country, 25,495 are in Metro Manila.3
In light of the foregoing, the proposed measure seeks to regulate the Transport 
Network Service and recognize the responsibilities and rights of the Transportation 
Network Companies and Drivers. The LTFRB Is mandated to issue, deny an application 
of permit, as well as to limit, suspend, or revoke a permit of the TNC in cases of 
violation of the law. Under this measure, the Transportation Network Drivers are 
considered as common carriers for purposes of determining the liability and degree of 
diligence that must be observed In the course of transportation network services. In 
order to uphold the safety of passengers, the TNCs are required to adopt a vehicle 
safety policy. In addition, it is imperative for TNCs to maintain an updated database 
of all the TNDs, a customer service assistance for reporting of complaints, and ensure 
compliance of the TNDs with the zero alcohol and drugs policy.
1 https://rtl.ph/press/The-Future-of-Transport-Network-Vehide-Services-or-TNVS
2 Department Order No. 2018-013, Department of Transportation, June 11, 2018.
3 https://pia.gov.ph/news/2022/06/06/7000-slots-sa-tnvs-bubuksan-ng-ltfrb-sa-ncr


It is the main purpose of this bill to provide an alternative mode of public 
transportation for the commuters while promoting the convenience and safety of the 
riding public. Thus, the approval of this proposed measure is earnestly sought.
■
JOSEPH VICTOR "JV" EJERCITO


NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE
S. No. S89
1' 
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■22 JUL 12 PI 29
Rl:CE!V.,0 B1
INTRODUCED BY SENATOR JOSEPH VICTOR 'UV" G. EJERCITO
AN ACT
RECOGNIZING TRANSPORTATION NETWORK COMPANIES AND DRIVERS, 
PRESCRIBING REQUIREMENTS, GUIDELINES AND STANDARDS FOR THEIR 
OPERATION, PROVIDING PENALTIES FOR VIOLATION THEREOF, AND FOR 
OTHER PURPOSES
Be it enacted by the Senate and the House of Representatives of the Phiiippines, in 
Congress assembied:
1 
SECTION 1. Short Title.- This Act shall be known as the "Transportation
2 
Network Service Act".
3 
Sec 2. Declaration of Policy. - It is the policy of the State to provide and promote
4 
adequate and efficient modes of transportation in the country. Toward this end, the
5 
State shall enact measures for the regulation of transportation network services to
6 
ensure that the paramount interest of the public is protected and conserved, while
7 
encouraging free enterprise and economic development.
8 
Sec 3. Definition of Terms.- 
As used In this Act:
9 
a. Board refers to the Land Transportation Franchising and Regulatory Board
10 
(LTFRB);
11 
b. Passenger refers to an individual who uses a transportation network company's
12 
service platform to connect to a driver for transportation network services,
13 
including all other persons who accompany 
said individual for the duration of
14 
such service;


1 
c. Persona! vehicle refers to a motor vehicle that satisfies all of the following
2 
conditions:
3 
1. owned, leased, or otherwise authorized to be used by the driver;
4 
2. not a public utility vehicle as defined in Republic Act No. 10586 and other
5 
related laws;
6 
d. Service platform refers to any Internet site or online-enabled application
7 
software or system that permits the pre-arrangement of transportation network
8 
services;
9 
e. Transportation Network Company (INC) refers to a business organization,
10 
whether a corporation, partnership, or sole proprietorship licensed to operate
11 
in the Philippines, that provides pre-arranged transportation services for
12 
compensation using an internet-based application 
or digital platform
13 
technology to connect passengers and drivers using their personal vehicles;
14 
f. Transportation Network Driver (TND) refers to an individual who :
15 
1. satisfies the requirements in this Act;
16 
2. pays a fee to a TNC to connect to a passenger for the purpose of
17 
engaging in transportation network services; and
18 
3. operates a personal vehicle to engage in transportation network services
19 
for compensation; and
20 
g. Transportation Network Services (TNS) refers to a transportation of a
21 
passenger between points chosen by the passenger and that is pre-arranged
22 
with a TND through the use of a TNCs service platform. The TNS begins from
23 
the moment the TND accepts a request for transportation on the TNCs service
24 
platform and ends when the TND completes the transaction on the service
25 
platform or when the trip is complete and the passenger exits the TND's vehicle,
26 
whichever is later.
27 
Sec 4. Nature of Transportation Network Companies and Drivers. - TNDs are
28 
hereby considered as common carriers for purposes of determining the liability and
29 
degree of diligence that must be observed in the course of transportation network
30 
services, and the presumption of negligence in case of breach of contract of carriage
31 
shall likewise apply to them. TNCs shall be required to exercise the diligence of a good
32 
father of a family in the course of complying with its obligations under this Act and


1 
the regulations that the Board may issue in relation thereto. TNCs shall be solidarily
2 
liable with TNDs In case the latter has been found guilty of any violation of laws, rules
3 
and regulation that involves a passenger as defined in this act.
4 
CHAPTER II.
5 
REGULATION OF TRANSPORTATION NETWORK COMPANIES
6 
Sec 5. Issuance of Permits to TNCs. - A person, organization, or entity shall not
7 
be allowed to operate a TNC without first obtaining a Permit from the Board upon
8 
compliance with the requirements set forth by this Act and other reasonable conditions
9 
as may be provided by the Board.
10 
Sec 6. Application for Permit The Board shall grant a Permit to a TNC upon
11 
determination that all of the following requirements are met:
12 
a. Submission of application in the form prescribed by the Board. The application
13 
shall have a minimum requirement that include tire applicant's name, address,
14 
tax identification number, and any other information that the Board may deem
15 
necessary to assess the applicant's qualification;
16 
b. Proof that the applicant is licensed to do business in the Philippines and a
17 
resident agent for purposes of service of processes in the Philippines if the
18 
applicant is a foreign corporation; and
19 
c. Payment of an application fee to be set by the Board upon filing of the
20 
application. The applicant shall notif/ tire Board of any material change in the
21 
information included in the application not later than fifteen (15) days after the
22 
change occurs. The Board shall prescribe a form for the disclosure of material
23 
changes.
24 
Sec 7. Term and Renewal of Permit - A permit Issued by the Board shall be
25 
valid for a period of three (3) years unless sooner revoked by the Board for any of the
26 
causes provided under Section 23.
27 
The Board shall prescribe the form and requirements necessary for the renewal
28 
of a permit.
29 
CHAPTER III.
30 
OPERATION OF TRANSPORTATION NETWORK COMPANIES
31 
Sec. 8. Requirements for TNCs - A transportation network company shall:


1 
a. Create an application process for a person to apply for registration as a
2 
transportation network driver;
3 
b. Maintain an updated database of the TNCs transportation network drivers;
4 
c. Maintain a website with the following information:
5 
1. The TNCs customer service telephone number and/ or electronic mail
6 
address;
7 
2. The TNCs zero tolerance policy established under this Act;
8 
3. The procedure for reporting a complaint about the TND;
9 
4. Conduct, or have a third party conduct, a safety inspection of the
10 
personal vehicle that a TND will use before the motor vehicle may be
11 
used to provide transportation network services and ensure compliance
12 
with the TNCs vehicle safety policy established under this Act; and
13 
5. Maintain an insurance policy as required under Section 17 of this Act.
14 
Sec. 9. Zero Tolerance for Illegal Drug or Alcohol Use. - Every TNC shall
15 
develop and implement a policy prohibiting any TND from using illegal drugs or alcohol
16 
or any other substance that may render the TND Incapable of driving safely while tire
17 
TND is engaged in transportation network services for the TNC or is logged onto the
18 
TNCs service platform. The TNC shall;
19 
a. Establish a complaint procedures for reports of suspected violations of the zero
20 
tolerance policy;
21 
b. Conduct an investigation upon receipt of a complaint that the TND violated the
22 
zero tolerance policy required under this Section and immediately suspend a
23 
TND's access to its service platform for the duration of the investigation;
24 
c. Initiate and/or refer the filing of appropriate charges of the erring TND to
25 
government agencies;
26 
d. Maintain records relevant to the requirements of this Section for the purposes
27 
of enforcement.
28 
Sec. 10. Vehicle Safety Policy. - TNCs shall adopt a vehicle safety policy to
29 
ensure the comfort and security of passengers using transportation network services.
30 
Such policy shall observe the following minimum standards:


1 
a. transportation of passengers in numbers exceeding the manufacturer's
2 
designed seating capacity shah be prohibited, notwithstanding the state's policy
3 
of encouraging ride-sharing;
4 
b. vehicle must be road-worthy and compliant with vehicle emission standards
5 
but, in any case, must not be more than ten (10) years old from date of
6 
manufacture; and
7 
c. vehicle must be equipped with proper tools and equipment.
8 
Sec. 11. Fare Setting and Disclosures. - A TNC is hereby authorized to set
9 
fares but shall disclose the fare calculation method, the applicable rates being charged,
10 
and the option for an estimated fare to a passenger before the passenger arranges a
11 
trip with a TND subject to rules and regulation imposed by the Board.
12 
If a TNC utilizes dynamic pricing to incentivize drivers in an effort to maximize
13 
the supply of available vehicles on the service platform to match the demand for rides
14 
and increase reliability, the service platform must:
15 
a. Provide clear and visible indication that dynamic pricing is in effect prior to
16 
requesting a trip;
17 
b. Include a feature that requires passengers to confirm that they understand that
18 
dynamic pricing will be 
applied in order for the trip request to be completed;
19 
and
20 
c. Provide a fare estimator that enables the user to estimate the cost under
21 
dynamic pricing prior to requesting the trip.
22 
Notwithstanding the preceding paragraph, dynamic pricing may be suspended
23 
during abnormal market disruptions, such as but not limited to any change In the
24 
ground transportation market, whether actual or imminently threatened, resulting
25 
from severe weather disturbances and natural calamities, failure or shortage of electric
26 
power or other source of energy, strike, civil disorder, war, military action, national or
27 
local emergency, or other cause of an abnormal disruption of the market resulting in
28 
a disaster or the declaration of a state of emergency.
29 
Sec. 12. Electronic Receipt - Within a reasonable time after the completion of
30 
a trip, a TNC shall transmit an electronic receipt to tire passenger's electronic mail
31 
address or mobile application containing the origin and destination of the trip; the
32 
total time and distance of the trip; and breakdown of the total fare paid, if any.


1 
Sec. 13. Identification of Transportation Network Drivers and Vehicies. - TNCs
2 
shall make available to each prospective passenger, on its service platform, the
3 
photograph of the TND and the license plate number and description of the TND's
4 
vehicle. TNDs shall display tire TNCs trade dress on the vehicle at all times it Is being
5 
used to provide transportation network services.
6 
Sec. 14. Confidentiaiity of Passenger Information. - TNCs shall not disclose a
7 
passenger's personally identifiable information to any other person unless:
8 
a. The passenger consents to the disclosure;
9 
b. The disclosure Is required by a legal obligation; and
10 
c. The disclosure is necessary to protect or defend the terms of use of the service
11 
or to Investigate a violation of those terms.
12 
In addition, a TNC shall be permitted to share a passenger's name and
13 
telephone number with a TND for the sole purpose of facilitating communication
14 
between the passenger and the driver regarding pre-arranged trips. TNCs shall
15 
prohibit the use by TNDs of a passenger's name, telephone number, or other personal
16 
information for any purpose other than those listed in this Section.
17 
Sec. 15. Requirements for Transportation Network Drivers. - An individual
18 
may submit an application to a TNC for registration as a TND.
19 
a. Before approving an application, a TNC shall;
20 
1. Require the individual to submit an application that Includes at least all
21 
of the following:
22 
i. The individual's name, address, and age;
23 
li. Information on the individual's professional driver's license;
24 
ill. Proof of motor vehicle registration for the personal vehicle the
25 
individual will use to provide TNS through the TNC;
26 
iv. Proof of availability of an off-street parking space for the vehicle
27 
that he will use to provide TNS; and
28 
V. Proof of motor liability insurance coverage as required under
29 
Section 17 of this Act.
30 
vi. Conduct a review of the individual's driving history; and
31 
vii. Conduct, or have a third party conduct, a criminal background
32 
checks for the individual.


1 
b. A TNC shall not approve an application submitted under subsection (a) of this
2 
Section and shall permanently disqualify an applicant who:
3 
i. is below eighteen (18) years of age;
4 
ii. has been sentenced by final judgment for an offense involving
5 
moral turpitude or for an offense punishable by one (1) year or
6 
more of imprisonment, within two (2) years after serving
7 
sentence;
8 
iii. has been found to have committed, within three (3) years prior
9 
to the application, any violation of laws, rules and regulations
10 
governing land transportation;
11 
A person whose application as TND has been approved shall be issued a TND
12 
Certificate which shall contain the name, address and picture of the driver, and the
13 
registration plate number of the vehicle that he will use. The form of the certificate
14 
shall be approved by the Board.
15 
Nothing in this Section shah be interpreted to prevent a TNC from Imposing
16 
additional standards or requirements for the registration of TNDs.
17 
Sec. 16. Drivers as Independent Contractors.- TNDs shall be independent
18 
contractors and not employees of the TNC if all of the following conditions are met:
19 
a. TNC does not prescribe specific hours during which a TND must be logged into
20 
the TNCs platform;
21 
b. TNC does not assign a TND particular territory in which to operate; and
22 
c. TNC does not restrict a TND from engaging in any other occupation or business.
23 
Sec. 17. Insurance Requirements. - TNCs and TNDs shall both maintain
24 
insurance policies to cover claims for Incidents involving vehicles and drivers while
25 
they are providing transportation network services. The Board shah determine, upon
26 
consultation with stakeholders, the insurance coverage, including the types of
27 
coverage and the limits for each coverage, that TNCs shall maintain during the validity
28 
of their permit.
29 
In every instance where insurance maintained by a TND has lapsed, failed to
30 
provide the required coverage, denied a claim for a required coverage, or otherwise
31 
ceased to exist, the Insurance maintained by a TNC shall provide the required
32 
coverage.
7


1 
A TNC shall neither require nor include a hold harmless or Indemnification
2 
clause in the terms of agreement with a TND. Such clause, If included in the
3 
agreement, shall be an absolute nullity.
4 
In the event of an accident, a TND shall provide insurance coverage Information
5 
directly to Interested parties, insurers and investigating police officers, upon request.
6 
Sec. 18. Street Hails- It shall be prohibited for a TND to solicit or accept street
7 
hails or otherwise provide transportation for compensation that are not pre-arranged
8 
through a TNCs service platform.
9 
Sec. 19. Cash Payments. - A TND may not solicit or accept cash payments or
10 
tips over and above the fare calculated by the TNCs service platform and reflected In
11 
the electronic receipt required under Section 12.
12 
Sec. 20. Fleet Sen/ice. - TNCs shall not be allowed to have their own fleet
13 
service or be authorized to enter into an agreement with a fleet operator to provide
14 
transportation network services. For purposes of this Act, a person who operates more
15 
than one (1) motor vehicles shall be considered a "fleet operator" and shall not be
16 
registered by the TNC with its service platform.
17 
A TND shall not be allowed to register or apply two (2) or more motor vehicles
18 
to be used for transportation network services to any TNC.
19 
Sec. 21. Tax Treatment - The Bureau of Internal Revenue shall determine the
20 
tax liability of TNCs and TNDs and provide the appropriate guidelines for compliance
21 
therewith.
22 
CHAPTER IV.
23 
ENFORCEMENT
24 
Sec. 22. Regulatory Authority. - The authority of the Board shall be limited to
25 
the issuance of permit and regulation of TNCs to ensure their compliance with the
26 
provisions of this Act. Such authority shall not include jurisdiction to adjudicate private
27 
causes of action arising from the provision of transportation network services.
28 
Sec. 23. Disciplinary Proceedings.- The Board, after due notice and hearing,
29 
may deny an application, limit, suspend, or revoke a permit if the TNC:
30 
a. Makes a material misrepresentation in any application filed under this Act or
31 
rules of tire Board;


1 
b. Fails to comply with the provisions of this Act or any rule promulgated pursuant
2 
to this Act;
3 
c. Violates any other law that substantially relates to the operation of TNCs;
4 
d. Fails to cooperate with the Board, or fails to timely respond to a request for
5 
information by the Board, in connection with an investigation pursuant to this
6 
Act; or
7 
e. Fails to maintain the qualifications for a permit;
8 
f. Violation of other existing laws of the Philippines.
9 
In addition to denial of application or other action under the immediately
10 
preceding paragraph, the Board may assess against a TNC for each violation
11 
enumerated thereunder, a fine not exceeding one million pesos (P1,000,000,00).
12 
Sec. 24. Penalties. - The Board shall determine the amount of the administrative
13 
penalty to be imposed on a person, firm, corporation or entity found violating the
14 
provisions of this Act, after considering the following factors:
15 
a. The seriousness of the violation or failure to comply, Including the nature,
16 
circumstances, extent, and gravity of the violations, and the harm or injury that
17 
may arise as a result of the violation;
18 
b. The history of contraventions of or failure to comply;
19 
c. The efforts made to correct the violation; and
20 
d. Any other factor that may be just and reasonable under the circumstances.
21 
Sec. 25. Fees and Other Charges - The TNCs shall be subject to an annual
22 
supervision fee, to be determined by the Board and subject to the approval of the
23 
Secretary of the Department of Transportation. The Board shall promulgate rules and
24 
regulations governing the collection of such fees, which shall likewise be reviewed
25 
periodically and any proposed increase shall be published in two (2) newspapers of
26 
general circulation.
27 
Sec. 26. Records. - All TNCs shall maintain passenger trip records for at least
28 
one (1) year from the date the trip was completed. TNCs shall also maintain all records
29 
concerning each TND for at least five (5) years after the date on which the TND ceases
30 
to engage in transportation network services for the TNC.
31 
The Board shall have the authority to examine records of TNCs, for the purpose
32 
of enforcement of this Act, including a random sample of the TNCs records related to


1 
pre-arranged rides and TNDs. Such examinations shall be conducted during working
2 
hours and shall not occur more than two times per year unless necessary to investigate
3 
a complaint. Records obtained by the Board, pursuant to this Section shall be kept
4 
confidential, except as may be required by law
5 
Sec. 27. Reportoria! Requirement - A TNC shall transmit a quarterly report to
6 
the Board providing an accounting of the number of vehicles it has registered to
7 
operate, number of trips provided, estimated number of passengers served, and any
8 
other information that the Board may deem necessary for the effective enforcement
9 
of this Act.
10 
CHAPTER V.
11 
FIMAL PROVISIONS
12 
Sec. 28. Implementing Rules and Regulations. - Within sixty (60) days from
13 
the effectivity of this Act, the Board shall promulgate the implementing rules and
14 
regulations as may be necessary to ensure the efficient and effective implementation
15 
of this Act.
16 
Sec.29. Separability Clause. - If any provision of this Act is held invalid or
17 
unconstitutional, the same shall not affect the validity and effectivity of the other
18 
provisions hereof.
19 
Sec 30. Repealing Clause. - All laws, decrees, executive orders, rules and
20 
regulations, which are inconsistent with the provisions of this Act ar e hereby repealed,
21 
amended or modified accordingly.
22 
Sec 31. Effectivity Clause. - This Act shall take effect fifteen (15) days after its
23 
publication In the Official Gazette or in a newspaper of general circulation.
Approved,
24
10