NINETEENTH CONGRESS OF THE 
]
REPUBLIC OF THE PHILIPPINES 
]
First Regular Session 
]
S.B. No.
SENATE
817
(tf tin? ;r?faiT
'22 JUL 25 All 33
RliCEfV'LD BV.
Introduced by SEN. WIN GATCHALIAN
AN ACT
REGULATING TRANSPORTATION NETWORK SERVICES, IMPOSING AND 
AUTHORIZING FEES, PROVIDING PENALTIES FOR VIOLATIONS THEREOF
AND FOR OTHER PURPOSES
EXPLANATORY NOTE
One of the reasons for the worsening traffic situation in the Philippines is the 
overpopulation of vehicles in the metropolitan area. Thousands of public utility vehicles 
(PUVs) and private vehicles clog the streets of Manila every day, which results in traffic 
jams along the main highways and major roads. As a consequence, not only is the 
transport of commuters delayed and their time wasted but the country as a whole 
suffers economic losses. According to the study by the Japan International 
Cooperation Agency (JICA), the country is projected to lose f 5.4 billion to traffic daily 
by 2035 if no interventions are made in Metro Manila. JICA had previously estimated 
that the Philippines loses f3.5 billion daily due to traffic congestion. The National 
Economic and Development Authority (NEDA) proposes that the primary solution to 
the traffic situation is still the improvement of transportation infrastructure. However, 
we cannot stand still while waiting for the government to develop our transportation 
network. We must look for alternatives to alleviate the suffering of our people in their 
daily commute.


It is therefore high time that we institutionalize the regulation of Transportation 
Network Services (TNS) to spur advancements in the transportation industry. The 
emergence of Transportation Network Vehicle Services (TNVS) such as Grab Grab, 
Joyride, and OWTO, to name a few, provides commuters more choices in their daily 
commute. The additional competition in the transportation industry compels existing 
taxi operators to improve their service in terms of convenience, safety and efficiency. 
Furthermore, , in view of easing COVID-19 restrictions, re-offering of ridesharing will 
help decongest roads by encouraging vehicle owners to leave their car at home and
utilize a TNS instead.
To address this, then Department of Transportation and Communication 
(DOTC) issued Department Order No. 2005-011 (DO No. 15-011) to recognize the new 
nature of ridesharing services. It intends to modernize and improve transportation 
services by the innovative use of technology to facilitate ridesharing services between 
a Transportation Network Driver (TND) and a Transportation Network Passenger 
(TNP). DO No. 15-011 allowed Transportation Network Companies (TNC) to operate 
in the Philippines and facilitate transactions between a TND and a TNP. It also provides 
the guidelines for the selection and accreditation of drivers.
However, DO No. 15-011 has faced heavy opposition since its promulgation. 
Taxi operators allege that the said Order offers unfair competition in favor of TNCs 
and TNVs because they are not subject to the same regulation as that of taxis. Some 
Congressmen also expressed their reservation citing issues on liability and tax 
collection.
Eventually, Department of Transportation (DOTr) Secretary Arthur Tugade 
signed Department Order No. 2018 - 013 giving full authority to Land Transportation 
Franchising and Regulatory Board (LTFRB) to regulate and supervise TNCs and TNVS. 
With these developments, there is still a need to institutionalize in a law the rules 
regulating TNVS as an emerging mode of land transportation in the metropolitan areas 
in the country. This bill seeks to define the nature of TNCs and Transport Network 
Vehicles (TNV) and clarify their role as a common carrier. . TNCs and TNVs are 
obligated under a contract of carriage once a passenger avails of their service. As a


common carrier, liability attaches once the contract between a TNP, a TNV, and a TNC 
is executed. A TNC therefore cannot evade liability by contending that they are merely 
a technological platform to connect the TNP with the TND. The TNC is the means and 
method by which the transportation service is arranged and facilitated. Furthermore, 
TNCs amass profit from facilitating the TNVS. The TNCs cannot have their cake and it 
eat too. They must be responsible for the service they provide and be held liable for 
any breach on the contract of carriage.
This bill also provides the standards in the accreditation of transportation 
network service providers and ensure the qualification of their drivers. It also requires 
the TNDs to issue electronic receipts for passenger safety and taxation purposes.
It is our intention to ensure that regulation is not a hindrance, but continues to 
be the safety net that the public can rely on for its protection. In the interest of 
transportation development and public service, support for th^/'^ss^e and approval 
of this legislation is earnestly sought.
IN GATC


NINETEENTH CONGRESS OF THE ] 
REPUBLIC OF THE PHILIPPINES ] 
First Regular Session 
]
72 JUL 25 AH 33
S.B. No.
SENATE
817
RECEIVED BY f.
Introduced by SEN. WIN GATCHALIAN
AN ACT
REGULATING TRANSPORTATION NETWORK SERVICES^ IMPOSING AND 
AUTHORIZING FEES, PROVIDING PENALTIES FOR VIOLATIONS THEREOF
AND FOR OTHER PURPOSES
Be it enacted by the Senate and the House of Representatives of the Phiiippines in 
Congress assembied:
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SECTION 1. Short Tide, - This Act shall be known as the "Transportation
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Network Service Act."
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SEC. 2. Deciaration of Policy. — It is hereby declared as a policy of the State to
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promote a rising standard of living and an improved quality of life for all Filipinos.
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Thus, the State shall encourage the provision of alternative modes of transportation,
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afford more riding options to the public, and drive advancements in the transportation
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industry.
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Towards this end, the State shall enact measures for the development and
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regulation of transportation network companies and vehicles and to ensure the safety
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of both the driver and the riding public.


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SEC. 3. Definition of Terms, - As used in this Act:
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a) Board refers to the Land Transportation Franchising and Regulatory Board;
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b) Digital network refers to any online-enabled application, software, website,
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or system offered or used by a transportation network company that enable the pre-
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arrangement of a ride with a transportation network driver;
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c) Transportation Network Services refer to transportation provided by a
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Transportation Network Driver (TND) to a Transportation Network Passenger (TNP),
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beginning at the time the driver accepts a ride requested by the passenger through a
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digital network controlled by a Transportation Network Company (TNC), continuing
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while the driver transports the passenger, and ending at the time the last requesting
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passenger departs from the driver's transportation network vehicle;
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d) Transportation Network Company (TNC) refers to an organization, whether
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a corporation, partnership, sole proprietor, or any association, operating in the
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Philippines that provides pre-arranged transportation services for compensation using
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an online-enabled app or platform to connect passengers with drivers using their
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personal vehicles.
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e) Transportation Network Driver (TND) refers to an individual who:
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j. Receives connections to potential TNP and related services from a TNC
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in exchange for payment of a fee to the company; and
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ii. Uses a TNV to offer or provide TNS to a TNP through a digital network
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controlled by the company in exchange for compensation or payment of
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f) Transportation Network Vehicle (TNV) refers to a vehicle accredited by a TNC
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and used by a TND to provide TNS;
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g) Transportation Network Vehicle Operators (TNVO) refers to owners of TNVS
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used by a TND to provide TNS.
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h) Transportation Network Passenger (TNP) refers to an individual who uses a
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TNCs digital network to connect with a TND who provides TNS to the individual using
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a TNV between points chosen by the individual.


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i) Commercial Liability Insurance refers to a standard insurance policy issued 
to a TNC to cover any liability claims for breach, bodily injury, death and property 
damage arising during the course of the TNS.
SEC. 4. Nature of Transportation Network Companies and Vehicles. - TNCs 
offer, represent or engage themselves to carry TNPs who opt to avail of their digital 
network service. TNCs are hereby declared as common carriers. A contract of carriage 
commences from the time a TNP makes a pre-arranged ride with the TNC and ends 
at the time the TNV carrying the TNP arrives at the designated location.
TNV operators are common carriers in the course of the TNS and are 
responsible for any breach in the contract of carriage.
SEC. 5. Liabilities. -
a) The diligence required of TNCs and TNDs in the conduct of their business is 
extraordinary diiigence as defined by law. A TND is presumed to be negligent when 
there is breach in the contract of carriage. The liability may include, but is not limited 
to, actual and moral damages as well as indemnity for loss of earning capacity. The 
TNC and the owner/operator of the TNV shall be jointly and solidarily liable with the
TND.
b) Taxicabs, limousines, or similar vehicles for-hire which also avail of digital 
networks to connect and provide transportation services to their passengers for pre­
arranged rides shall likewise be covered under the provisions of this Act and remain 
liable under the conditions set forth under their Certificate of Public Convenience and 
Necessity and other existing laws, rules and regulations.
SEC. 6. Appiicabiiity of Existing Regulations - All memorandums and guidelines 
promulgated by the Board shall suppletorily apply to all claims in case of any breach 
by the TNC or the owner/operator of TNV on the contract of carriage without prejudice 
to any other administrative or court proceedings instituted by the aggrieved party.


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SEC 7. Regulatory Authority. - TNCs and TNVOs shall be governed by the 
provisions of this Act and other rules adopted by the Board pursuant to this Act.
SEC. 8. Accreditation. — A person, firm or corporation shall only be allowed to 
operate a TNC by obtaining and maintaining a permit to be issued by the Board upon 
compliance with the requirements set forth by this Act and other reasonable conditions 
as may be provided by the Board.
SEC 9. Accreditation Fee. - An accreditation fee to be set by the Board shall be 
paid upon filing of the application and before the issuance of the Certificate of TNC 
Accreditation.
SEC 10. Application for accreditation. -
a) An application for a TNC accreditation must be in a form prescribed by the 
Board. The application shall contain information required by this Act and other 
pertinent data that the Board may deem necessary to assess and identify the 
applicant's qualifications to adequately serve the public.
b) The applicant shall notify the Board of any material change in the information 
included in an application not later than ten (10) days after the change occurs. The 
Board shall prescribe a form for the disclosure of material changes.
SEC. 11. Term and Renewal of Accreditation.—
a) An accreditation issued under this Act is valid for two years unless sooner 
revoked by the Board for reasonable cause. The Board shall prescribe the form and 
requirements necessary for the renewal of an accreditation;
b) The Board shall notify each person holding an accreditation of the date of 
its expiration and the amount of the fee required for the renewal. The Board shall 
send the notice not later than thirty (30) days before the accreditation expires.


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SEC. 12. Agent - A TNC shall maintain a resident agent authorized to accept 
summons and process In all legal proceedings and all notices affecting the TNC.
SEC. 13. Fares- A TNC charging a fare for its services shall disclose to the TNP 
the fare calculation method within the company's software application service or on 
the company's internet website and provide the TNP with the applicable rates being 
charged for the service and the option to receive an estimated fare.
SEC. 14. Identification of Vehicles and Drivers. - The TNCs software application 
or Internet website must display a picture of the TND and the plate number of the 
TNV.
SEC. 15. Insurance Coverage. - TNCs shall maintain a commercial liability 
Insurance policy to cover claims for incidents involving vehicle and drivers while they 
are providing TNC services. It shall likewise cover claims of passengers for breach of 
the contract of carriage per incident coverage.
The Board shall determine, upon consultation with stakeholders, the amount 
that TNCs shall maintain during the validity of their accreditation.
Each TNC driver shall maintain insurance coverage.
Nothing in the TNCs Terms of Service can be used or relied on by the TNC to 
deny insurance coverage, or otherwise evade the Insurance requirements to be 
determined by the Board.
A TND shall carry proof of transportation network company insurance coverage 
with him or her at all times during his or her use of a vehicle in connection with a 
transportation network company's online-enabled application or platform. In the event 
of an accident, a participating driver shall provide the insurance coverage information 
to any other patty involved in the accident, and to a police officer, upon request.
SEC. 16. Electronic Receipt - Upon completion of a trip, a TNC shall transmit 
an electronic receipt to the TNP that lists:


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a) The origin and destination of the trip;
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b) The total time and distance of the trip; and
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c) An itemization of the total fare paid, if any.
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Electronic receipts of each TND of all its transactions shall be recorded by the
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TNC and reported to the Bureau of Internal Revenue (BIR) for purposes of taxation.
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SEC. 17. Zero-tolerance Policy for Drug or Alcohol use. -
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a) Every TNC shall:
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1) Implement a zero-tolerance policy that prohibits a TND from using or
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being under the influence of illegal drugs and alcohol abuse; and,
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2) Post in its internet website a notice of the policy and the procedures
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to report a complaint about a driver with whom a TNP was matched and who
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the TNP reasonably suspects was using or was under the influence of drugs or
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alcohol during the course of the trip.
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b) Upon receipt of a complaint alleging a violation of the zero-tolerance policy,
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the TNC shall investigate the reported incident and immediately suspend the TND’s
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access to the company's digital network for the duration of the investigation.
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c) The TNC shall maintain records relevant to any complaint for a period of at
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least two years after receipt of the complaint.
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SEC 18. Driver Requirements. —
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a) Before allowing an individual to be a TND on its digital network, a TNC shall:
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1) Require the individual to submit an application to the TNC, which must
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include information regarding the individual's address, age, driver's license,
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driving history, motor vehicle registration, motor vehicle liability insurance, and
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other information as may be required by the TNC;
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2) Conduct or have a third party conduct a local and national criminal
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background check for each individual; and
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3) Obtain and review the individual's driving record.


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b) The TNC may not permit any individual to act as a TND on its digital network 
when the individual:
1) Has been convicted of any of the following offenses in the preceding 
three-year period:
i) Evading arrest or detention;
ii) Reckless driving;
iii) Driving without a valid driver's license; or
iv) Driving under the influence of alcohol or prohibited drugs.
2) Has been convicted at any time of:
i) Fraud;
ii) A sexual offense; or
iii) Theft.
3) Does not possess a valid professional driver's license; and
4) Does not possess proof of registration for the TNV used to provide 
transportation network services.
SEC. 19. No Street Hails. — A TND may only accept pre-arranged rides made 
through a TNC's digital network or software application service and may not solicit or 
accept street hails.
SEC. 20. No Cash Trips. - A TND shall not solicit nor accept cash payments from 
TNPs. All payments for TNS may be made only electronically using the TNCs digital 
network or software application.
SEC. 21. No Fleet Service. - A TNC is not allowed to have its own fleet service. 
Otherwise, it shall be required to secure a Certificate of Public Convenience and 
Necessity from the Board pursuant to the Public Service Law.


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SEC 22. No Discrimination; Accessibiiity. —
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a) A TNC shall adopt policies concerning non-discrimination that comply with
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national laws;
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b) A TND shall follow all policies concerning non-discrimination and accessibiiity
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in compliance with national laws;
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c) A TNC may not impose additional charges for providing services to persons
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with disabilities;
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d) A TNC shall provide a TNP an opportunity to indicate whether they require
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a wheel-chair accessible vehicle. If a TNC is unable to arrange wheelchair accessible
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TNS, the company shall direct the TNS to an alternate provider of wheelchair-
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accessible TNS, if available;
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e) A TND may not discriminate in the provision of transportation network
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services based on the geographic location of a departure point or destination. A TND
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may refuse a request for an extended ride beyond the pre-arranged destination.
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SEC. 23. Records. — All TNCs shall maintain individual trip records for at least
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one (1) year after the date the trip was completed. TNCs shall also keep TND records
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for at least one (1) year from the time a TND's activation on the company's digital
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network has ended.
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SEC. 24. Personaiiy Identifiabie Information. —
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a) A TNC may not disclose a TNP's personally identifiable information to a third
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party unless:
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1) The passenger consents to the disclosure;
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2) The disclosure Is required by a legal obligation; or
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3) The disclosure Is required to protect or defend the terms of use of the
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service or investigate violations of those terms.
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b) In addition to the disclosures authorized under paragraph (a), a TNC may
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share a TNP's name or telephone number with the TND providing transportation


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network services to the passenger to facilitate correct identification of the TNP by the
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TND or to facilitate communication between the TNP and the TND.
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SEC. 25. Record Audits. - The Board may audit the records of a TNC in
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connection with the performance of its duties under this Act through investigations of
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specific alleged violations or a random sample of the TNCs records related to TND.
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Failure to provide records as required by this Section constitutes a violation of this Act.
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SEC. 26. Disciplinary Action; Fine. —
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a) The Board, after due notice and opportunity for hearing, may deny an
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application for an accreditation or suspend or revoke an accreditation if the applicant:
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1) Makes a material misrepresentation or omission in any application or
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other information filed under this Act or rules of the Board;
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2) Violates this Act or a rule or order of the Board;
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3) Violates any law relating to the operation of a TNC; or
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4) Fails to maintain the qualifications for an accreditation.
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b) In addition to the authority under the preceding paragraph (a), the Board,
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after due notice and opportunity for hearing, may request that the Department of
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Justice (DOJ) bring an action against a person that has violated this Act or the rules
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promulgated by the Board pursuant to this Act to collect a fine in the amount not to
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exceed Fifty thousand pesos (P50,000.00) for each violation.
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c) Each act as enumerated in paragraph (a) of this Section constitutes a
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violation and each day a violation continues will be considered a separate violation. In
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determining the amount of penalty, the Board shall consider:
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i. The seriousness of the violation, including the nature, circumstances,
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extent, and gravity of any prohibited act, and the harm or potential harm to
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the safety of the public;
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ii. The economic damage to the public caused by the violation;
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iii. The history of previous violations;
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iv. The amount necessary to deter future violations;


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V. Efforts to correct the violation; and
Vi. Any other matter that justice may require.
SEC. 27. Complaint Procedure and Notice. -
a) A TNC shall establish and maintain a complaint procedure through which any 
TNP or another person using the transportation network. TNS may submit a complaint 
with the Board about the TNC, the TNS, a TND, or another affiliate of the TNC;
b) A TNC shall provide a notice of the complaint procedure provided by this 
Section to each TNP and to each person that contacts the company to inquire about 
TNS;
c) A TNC shall provide notice of the complaint procedure under this Section to 
each electronic receipt required under this Act;
d) The Board shall approve the content and manner of delivery of the notice 
required by subsections (a), (b), and (c); and
e) Failure to provide notice as required by this Section is a violation of this Act.
SEC. 28. Implementing Rules and Regulations. - Within (60) days from the 
effectivity of this Act, the Board shall promulgate the implementing rules and 
regulations as may be necessary to ensure the efficient and effective implementation 
of this Act.
SEC. 29. Separability Clause. — Should any part of this Act be declared 
unconstitutional, the rest of the provisions of this Act shall continue to be In effect and 
subsisting.
SEC. 30. Repealing Clause. - The pertinent provisions of the Land 
Transportation and Traffic Code, in so far as they are inconsistent herewith, are hereby 
amended or modified accordingly. The provisions of other laws, decrees, executive 
orders, rules and regulations inconsistent with this Act are hereby repealed, amended, 
or modified accordingly.
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SEC. 31. Effectivity. — This Act shall take effect fifteen (15) days after its
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publication in the Official Gazette or in at least two (2) national newspapers of general
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circulation.
Approved,
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