The Land Transportation Franchising and Regulatory Board (LTFRB) on Wednesday ordered Grab Philippines to reduce its surge pricing cap from 2 to 1.5 times the normal fare immediately as it processes the applications of new transportation network companies (TNCs).
The Board wants to ensure that the fares would be acceptable to transport vehicle services (TNVS) operators who would transfer to Grab’s platform as a result of the acquisition of Uber’s operations in Southeast Asia.
“This is to ensure that the fares will be at a rate that is conducive and acceptable to the existing number of TNVS that are transferring to Grab,” LTFRB Board member Aileen Lizada said during a hearing Wednesday.
This amends LTFRB’s order that sets the surge price rate of TNCs at twice the normal fare.
The Board is also giving Uber until April 15 to operate.
“The soonest possible time that you will be able to resolve your concerns with PCC (Philippine Competition Commission), the better. Therefore, in the interest of all TNVS and the riding public, we are giving you until April 15 to exist as a TNC. On April 16, you cease and desist to exist as a TNC,” Lizada said.
For its part, Grab said it would comply with the LTFRB’s order to decrease its surge rates.
“We respect the Board’s decision to further lower the surge cap and we understand the justification for it. This is in fact a critical time and we believe as soon as the new players come in, the Board will perhaps study again the cap ,” Leo Gonzales, Grab public affairs head, said in an interview with reporters.