Rules and Regulations to Govern the Accreditation of Transportation Network Companies

October 23, 2017

LTFRB MEMORANDUM CIRCULAR NO. 015-A-15

 

ON 21 JULY 2016 THE BOARD ISSUED MEMORANDUM CIRCULAR NO. 2016-008 ORDERING THE MORATORIUM ON ACCEPTANCE OF TRANSPORT NETWORK VEHICLE SERVICE (TNVS) APPLICATIONS FOR FRANCHISE.

ON 01 SEPTEMBER 2016, MEMORANDUM CIRCULAR No. 2016-012 WAS ISSUED EXPANDING THE COVERAGE OF THE MORATORIUM AND IMPLEMENTED A NATIONWIDE MORATORIUM ON THE ACCEPTANCE OF TNVS APPLICATIONS. SDAaTC

AFTER A SERIES OF MEETINGS, CONSULTATIONS, DIALOGUES WITH ALL CONCERNED PARTIES AND AFTER EXHAUSTIVE AND THOROUGH DELIBERATION AND REVIEW, THE BOARD HEREBY AMENDS THE PROVISIONS OF MEMORANDUM CIRCULAR No. 2015-015 WHICH IS REITERATED WITH THE HIGHLIGHTED AMENDMENTS INCORPORATED THEREIN FOR EASY REFERENCE.

PURSUANT TO THE PROVISIONS OF DEPARTMENT ORDER NO. 2015-11 ON THE CREATION OF A NEW TYPE OF SERVICE FOR PUBLIC TRANSPORT CONVEYANCES KNOWN AS "TRANSPORT NETWORK VEHICLE SERVICE" AND ON THE ACCREDITATION OF TRANSPORTATION NETWORK COMPANIES, THE FOLLOWING RULES AND REGULATIONS TO GOVERN THE ACCREDITATION OF TRANSPORTATION NETWORK COMPANIES ARE HEREBY PROMULGATED.

I. SCOPE OF APPLICATION

A Transportation Network Company (TNC) as defined under Department Order No. 2015-011, shall mean as an "organization whether a corporation, partnership, or sole proprietor, that provides pre-arranged transportation services for compensation using an internet-based technology application or digital platform technology to connect passengers with drivers using their personal vehicles," hence treated as a transport provider.

These Rules and Regulations shall only apply in the accreditation of TNC. The Certificate of, TNC Accreditation shall be granted to TNCs providing internet-based technology application or digital platform technology to facilitate transportation of passengers by the drivers with the use of their personal vehicles.

II. APPLICATION FOR ACCREDITATION

An Application for the Issuance of a Certificate of Accreditation shall be made in writing on a form provided by the Board, and signed and sworn to by the applicant, or if the applicant is a juridical entity, by its duly authorized representative. Each Application, in addition to other documents that are required, shall submit at a minimum the following:

a) If the applicant is an individual:

1. Full Name;

2. Residence Address;

3. Business Address;

4. Business E-mail Address;

5. Business Telephone Number;

6. Business Name Registration duly issued by the Department of Trade and Industry; and,

7. Proof that the Applicant is at least Eighteen (18) Years of Age.

b) If the applicant is a resident domestic or foreign juridical entity:

1. Corporate/Partnership Name;

2. Business Address;

3. Business E-mail Address;

4. Business Telephone Number;

5. Certification of Registration of Incorporation/Partnership issued by the Securities and Exchange Commission (SEC);

6. Articles of Incorporation/Partnership and By-Laws;

7. Secretary's Certificate of the Board/Partnership Resolution authorizing the representative to sign the Application for Accreditation for and in behalf of the corporation/partnership; and,

8. Secretary's Certificate of Incumbent Corporate/Partnership Officers and List of Directors/Partners;

c) If the applicant is a non-resident foreign juridical entity:

1. Corporate/Partnership Name;

2. Business Address;

3. Business E-mail Address;

4. Business Telephone Number;

5. Authenticated Copy of the Articles of Incorporation/Partnership with an English Translation thereof if in foreign language other than English;

6. License to Do Business in the Philippines duly issued by the SEC;

7. Authenticated Copy of the Board Resolution authorizing the establishment of a Branch/Representative Office in the Philippines;

8. List of Incumbent Officers and Directors;

9. Authenticated Copy of the Board/Partnership Resolution authorizing the representative to sign the Application for Accreditation for and in behalf; acEHCD

10. Authenticated Copy of the Board/Partnership Resolution designating the Resident Agent to whom summonses and other legal processes may be served in behalf of corporation/partnership;

11. Authenticated Copy of the Board/Partnership Resolution stipulating that in the absence of such Agent or upon cessation of its business in the Philippines, any summons or legal process may be served to SEC as if the same is made upon the corporation at its home office.

III. OTHER REQUIREMENTS

The following shall also be attached upon filing of the Application for Accreditation:

a) Complete Description of Business Model;

b) Business Permit duly issued by the local government where the applicant's principal place of business is located;

c) Certificate of Registration duly issued by the Bureau of Internal Revenue; Latest ITR as a requirement for renewal of accreditation;

d) Sample Copy of the Electronic Receipt issued to the passenger at the completion of a ride;

e) Process of Accrediting/Affiliating vehicles Transportation Network Vehicle Service (TNVS) vehicle;

f) Process of Accrediting/Affiliating TNVS drivers;

g) Terms of Service for Passengers;

h) Terms of Service for TNVS Operators;

i) The Trade Dress;

j) The Proposal Fare Rates and/or Service Charges;

k) The Proposal for the Establishment of a Drivers' Training Program only for TNCs utilizing TNVS units;

l) Proof of applicant's financial capability to pay all judgments and awards that may be rendered for any cause arising out of the operation of a TNC business;

m) Undertaking of the applicant to comply with the Terms and Conditions for a Certificate of TNC Accreditation, as attached;

n) Complaint Mechanism against vehicle owners or drivers.

IV. ACCREDITATION FEE

There shall be a non-refundable Accreditation Fee in the amount of Ten Thousand Pesos (Php10,000.00). Said fee shall be paid before filing of the Application for the Issuance of the Certificate of TNC Accreditation.

V. VALIDITY OF THE CERTIFICATE OF TNC ACCREDITATION

The Certificate of TNC Accreditation shall be issued to any applicant, who/that complies with all the requirements prescribed above, for a period of two (2) years from issuance thereof and may be renewed.

The Certificate shall be non-transferable.

VI. LIABILITY

The TNC shall exercise due diligence of a good father of a family in accrediting and supervising its drivers. The TNC shall be held liable for acts or omissions committed by its TNVS while online, except if the same is beyond the TNC'S control.

VI. n CREATION OF A PRE-ACCREDITATION COMMITTEE

A Pre-Accreditation Committee is hereby created and shall be composed of the following:

The Executive Director — Chairman

The Chief of Legal Division — Vice-Chairman

The NCR Regional Director — Member

The Chief of Information and Systems Management Division — Member

The Chief of Technical Division — Member

The Committee shall evaluate all Applications filed and recommend to the Board for approval or disapproval of any Application.

Upon effectivity of this Circular, any interested applicant may file an Application, together with all the required documents, only before the Committee, through the Office of the Executive Director. Any Applicant who/that fails to submit or comply with any of the requirements prescribed above without any justifiable reason shall be disapproved outright without any need of further evaluation.

VII. REPEALING CLAUSE

All other issuances inconsistent herewith are deemed modified or superseded accordingly.

VIII. EFFECTIVITY

This Memorandum Circular shall take effect immediately following its publication in at least one newspaper of general circulation. Let three (3) copies hereof be filed with the UP Law Center pursuant to Presidential Memorandum Circular No. 11, dated 09 October 1992. HSAcaE

SO ORDERED.

Quezon City, Philippines, October 23, 2017.

(SGD.) ATTY. MARTIN B. DELGRA IIIChairman

(SGD.) ENGR. RONALDO F. CORPUSBoard Member

(SGD.) ATTY. AILEEN LOURDES A. LIZADABoard Member

Attested by:

(SGD.) ATTY. AUGUSTINE M. VESTIL JR.Executive Director

n Note from the Publisher: Copied verbatim from the official copy. Duplication of "VI.".