Grabbery by the LTFRB

Grab has opened up its app services to taxi drivers who can sign up upon verification of their identity and residential address for the safety of passengers. It has also introduced a new feature called Ride Share during peak commuting hours to maximize the income of its partners. 

The controversy over what the LTFRB has chosen to name as Transportation Network Vehicle Services has been going on since Uber and Grab launched their services in the country. Despite massive media coverage of the issue, it’s still far from being resolved.  

I attended a reunion with elementary school classmates last weekend. The occasion was having found one of our long-lost classmate who recently surfaced on Facebook. Rather than go through the hassle of a commute because of the monsoon rains, I decided to take a Grab car instead. 

I made a booking and the car promptly arrived at the designated time on the app. On the ride going to BGC where the resto for the reunion was, I decided to interview the driver. Marlon, not his real name, is a 32 year old college graduate, married with two children. His wife is a graphic artist who works out of their home while he used to work as a call center agent before he decided that he’d had enough of the shifting schedule and opted for a more relaxed work environment. He and his wife decided on investing part of their savings in a brand new sedan for Marlon to become a Grab partner. 

Marlon has been a Grab partner for three years now. What he likes about being a Grab driver is he’s his own Boss and can drive whenever he wants. On a good month, he can pull in as much as P50,000 gross on his share of the fares. He sets aside a monthly amount for routine preventive maintenance. His monthly gasoline expenses comes up to an average of P10,000 which translates to 1,400 kilometers traveled again on the average. 

I asked him what he thought about the issue between Grab and the LTFRB and his response was, for the most part, negative about LTFRB and somewhat negative for Grab as well. The negatives about Grab are the main issues why there is friction between the company and the government agency. But Marlon puts most of the blame on the members of the LTFRB board and the legislators in Congress. 
Marlon raises valid points about how Grab avoids the common carrier liability by having Grab partners apply for an individual franchise as a requirement to become a Grab partner. On the part of the LTFRB, the error is its requirements for a TNVS franchise is similar to that of a taxi operator; the most outlandish being the requirement of a verified parking space with a repairs and maintenance facilities that taxi operators have for their fleets which the same applies for those who only have one unit. 

He also cites the most recent issue concerning the LTFRB ban on hatchbacks which he said was really without basis considering other countries have deemed hatchbacks safe but the LTFRB unilaterally declared it as unsafe. This was ultimately resolved after a protest action which saw DOTr Secretary Arthur Tugade’s intervention which put an end to the controversy once and for all by allowing the registration of hatchbacks as Grab partners. 

Marlon laments the fact that no legislator has taken up the cudgels for the TNVS industry by crafting a TNVS Law which will lay down the implementing rules and regulations with regard to franchise requirements and common carrier liability. This is one of the more confusing aspects of the nature of TNVS; is it a common or private carrier? In the event of an accident resulting in injury, disability or loss of life what is the liability of the TNVS operator? Is it the liability of the Grab partner or Grab the company? The present insurance coverage of a standard Grab partner vehicle includes the Compulsory Third Party Liability required by the LTO and the comprehensive coverage for the vehicle in terms of own damage, theft and accident but nothing about the passenger(s) when used as a TNVS vehicle. 

Marlon is of the opinion that Grab should be granted a master franchise by the LTFRB instead of partner/drivers applying for one individually. His reasoning is a group policy would result in cheaper premiums which they would be willing to pay if only to have adequate insurance coverage for potential liability in case of an accident resulting in injury, death or disability. 

But above all this, Marlon laments how the LTFRB insiders have turned TNVS franchise applications as an opportunity for extortion in aid of facilitating the approval and release of the application. This is the result of the LTFRB’s limiting the number of slots available. 

Grab has opened up its app services to taxi drivers who can sign up upon verification of their identity and residential address for the safety of passengers. It has also introduced a new feature called Ride Share during peak commuting hours to maximize the income of its partners. 

Technology’s mantra is disruption but this is easily defeated by government bureaucrats whose focus continues to be extortion.

BLOG COMMENTS POWERED BY DISQUS

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TheLOBBYiST.
About the Author
RG is a seasoned international trade and sales and marketing professional who also dabbles in writing. He was a contributor to Business World in the mid-90s and is also a tech geek.
Other Articles