Uber’s PH Ban: Who are the winners and losers?
Is anyone benefitting from the Philippines’ Uber ban?
PHOTO CREDIT: Getty Images
Philippine social media has been in an uproar since the announcement of Uber’s one-month suspension, the latest development in a string of controversial events involving the ride-hailing platform.
The advisory came in the form of a tweet from the Philippine Land Transportation Franchising and Regulatory Board (LTFRB). Calling Uber’s actions “predatory,” the LTFRB recommended that the transport network company (TNC) extend financial assistance to its affected operators:
ADVISORY— Official LTFRB (@LTFRB) August 14, 2017
to all Uber TNVS pic.twitter.com/MpeeQl2ttG
Back in July 2016, Grab, Uber, and other TNCs were given a moratorium on processing new driver applications, but in spite of the government order, Grab and Uber continued to accept and process new driver applications.
A year later, Grab and Uber were fined PHP5 million each for defying the LTFRB’s orders. The LTFRB also issued a memorandum saying that it would begin apprehending transport network vehicle service (TNVS) drivers operating without government permits.
Inquirer.net reports that only 2,500 of Uber’s 66,000 vehicles and 3,000 to 4,000 of Grab’s 52,000 cars have the necessary permits to operate. Had the government carried out on its initial plan, they would have effectively crippled the two TNCs. But after Grab and Uber filed motions for reconsideration, the LTFRB decided not to apprehend unregistered vehicles until a decision on the appeal was finalized.
However, on August 14, 2017, the LTFRB suspended Uber’s operations after discovering that the TNC had defied its orders to stop accepting and accrediting new drivers. Uber maintains that it has “halted all activations of new vehicles on the Uber platform on July 19th.”
Our official statement regarding the recent LTFRB order. pic.twitter.com/gS9u1Zp4Km— Uber Philippines (@Uber_PH) August 1, 2017
Uber suspended operations on August 15 but went back online after filing a motion for reconsideration.
“I am now questioning the business etiquette of Uber,” says LTFRB board member Atty. Aileen Lizada in a press conference, GMA News reports. “What is your statement there? What are you trying to prove? We are suspending your accreditation for one month and now you are telling your TNVS to go on the road.”
“Where is your business etiquette Uber? If you are truly a partner operator why are you doing this to your TNVS? Sila ang mahuhuli. Hindi kayo, sila. [Your drivers are going to be the ones caught. Not you, them.]”
Uber and its history of ‘defiance’
In a press conference, LTFRB Chief told the media they were simply zeroing in on companies who are “not compliant of the law” and “predisposed to defiance of the law.”
This isn’t a totally inaccurate description of Uber, which has been plagued by a history of legal battles since its launch in 2009. Uber has been slapped with over 170 lawsuits, and that’s in the U.S. alone; the company has faced government opposition in most — if not all — of the cities that it has launched in, spending millions upon millions on legal bills.
These legal troubles are to be expected when your company’s M.O. is to set up shop in new territory without bothering to smooth out the legal technicalities. Once the public has grown dependent on the ride-sharing app’s service, governments have no choice but to make accommodations. Uber’s expansion model, as Fortune reports, seems to be based on asking for forgiveness, not permission.
More losers than winners
Uber’s success in Metro Manila is indicative of how the Philippines’ public transportation system has been constantly failing the Filipino commuter. In a city notorious for its faulty trains, exploitative taxis, and unsafe jeepneys and buses, Uber and Grab have presented alternatives that are convenient, comfortable, and safe. The suspension of Uber has taken away an option that many have learned to count on.
Thanks for suspending Uber while we figure out how to deal with coding and traffic on our own. It's not like we have jobs and stuff.— Francesca Litton (@CheckLit) August 14, 2017
While the riding public are suffering from Uber's suspension, these LTFRB officials are in the comfort of their own cars going to work.— Balotski23 (@AntokQueen) August 14, 2017
People still trying to book Uber despite the ruling is proof of how much people really prefer Uber.— Bianca Gonzalez (@iamsuperbianca) August 15, 2017
LTFRB, tulungan kayo ng Uber. Sige na.
I take the train...but the train is broken. I take Uber, but now they're suspended. O ano na? Ano ba ang gusto niyo, @LTFRB_Official?— mii (???) (@psychoshoujo) August 14, 2017
Apart from Uber’s rival Grab and traditional transport providers like taxis and cabs, not many —if any — are benefitting from the LTFRB’s decision. Naturally, Grab’s demand spiked after Uber’s suspension, increasing its rates by PHP20-50. Grab Philippines Country Head Brian Cu assures the public that Grab would not be taking advantage of the riding community:
"We are not going to do any type of predatory pricing. I want to assure the riding community of that," Grab PH's Brian Cu said.— ABS-CBN News (@ABSCBNNews) August 15, 2017
The LTFRB’s image has considerably suffered since it started pushing back against Uber and Grab. Though LTFRB chair Martin Delgra maintains that the LTFRB wants to support new technology, the government isn’t catching up to new developments quickly enough for the general public to believe that. The backlash has been so powerful that the Department of Transportation even asked if the TNCs had resorted to hiring an army of online trolls.
Some senators have spoken out against the LTFRB’s decision to suspend Uber’s operations, most notably Senator Grace Poe, the chair of the Senate committee on public services.
“The decision of the LTFRB to suspend Uber is both cruel and absurd, to say the least,” she says in a statement. “I am aghast that this agency that committed before the Senate to resolve the issues has just imposed a cure that will only make the disease much worse. It does not solve the problem, but further exacerbates the problem of having an utter lack of safe, reliable, and convenient transportation options for our people.”
Senator Sherwin Gatchalian calls LTFRB’s order of suspension “a reckless decision.” In a statement, he says, “I have nothing against holding Uber accountable for its violations, but the suspension order goes too far. It puts the burden of punishment on the shoulders of commuters who have already suffered enough. Instead, the imposition of a larger fine on Uber for its violations would be a more equitable and reasonable punishment.”
Senator Ralph Recto echoes these sentiments. “If the intent is to punish, then do it in a way that will hurt Uber, the company, and not the tired and harassed riding public,” says the Senator in an official statement.
Instead of a suspension, Sen. Recto avers that a better penalty would be in the form of a fine. “As we search for solutions, let us be guided by the fact that ride-sharing companies have prospered because in a city bereft of reliable mass transport, they have become for many not just the ride of last resort, but in fact the only ride.”
BY Entrepreneurs Organization