LTFRB to review Grab’s fare-setting scheme

The Land Transportation Franchising and Regulatory Board (LTFRB) said Thursday it will review Grab Philippines’ fare-setting scheme, after the Philippine Competition Commission (PCC) imposed P23 million in fines against the ride-hailing company.

The antitrust watchdog’s fines against Grab were not related to regulatory violations.

“To put it in proper context, the fine issued by PCC in its decision recently rendered pertains to the failure of Grab to fulfill its commitment to PCC as embodied in Grab’s undertaking which it voluntarily submitted to PCC. It has nothing to do with LTFRB’s fare structure,” LTFRB Board Member Ronaldo Corpus said.

The LTFRB and PCC met on November 25, 2019 to discuss Grab’s P23-million fine.

The LTFRB “shall therefore conduct a review to monitor Grab’s fare setting in order to determine any violation of the existing fare structure issued by the Board.”

Grab Philippines president Brian Cu said the LTFRB’s move to review the company’s fare-setting scheme is a welcome development.

“We respect and welcome the LTFRB’s intent to conduct a review to monitor our fare setting. Grab continues to work with our regulators, and we maintain our position that our fares remain to be compliant with the LTFRB’s fare matrix,” Cu said in a Facebook post.

In line with LTFRB’s Memorandum Circular 2019-036, transport network vehicles services (TNVS) should charge the following fares:

• Car/Sedan – Flagdown rate up to P40, P15 per kilometer fare, P2 fare per minute travel time, and 2x pricing surge

• Premium AUV/SUV – Flagdown rate up to P50, P18 per kilometer fare, P2 per minute travel time, 2x pricing surge

• Hatchback – Flagdown rate up to P30, P13 per kilometer fare, P2 per minute travel time, 2x pricing surge

On November 18, the PCC slapped Grab with P23.45 million in fines and ordered the ride-hailing company to refund its passengers some P5 million in “overcharges.”

The fines cover P11.3 million in penalties for the first quarter, P7.1 million for the second quarter, and P5.05 million for the third quarter.

The fines were imposed as Grab failed to meet the commitments it made to the government, according to the antitrust watchdog.

Grab has said that the violations noticed by the PCC were not overcharged fares but “deviations” from the fare range.

The company has since committed to refund P5.05 million to its passengers.

The LTFRB said it remains committed to its mandate of providing a transparent, accountable, safe, and timely service to the riding public.

“The agency shall continue to work closely with the PCC regarding this issue.” —VDS, GMA News