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Philippines gives Uber its first legal framework to operate in Asia

Mon 11 May 2015

The Philippines has become the first of Uber’s territories to provide the app-hailing ride-sharing company with a legitimate legal framework within which to operate in Asia – a global region where the company is experiencing some of its fiercest governmental antagonists.

The Transportation Network Vehicle Service (TNVS) classification, as announced on the website of The Philippines’ Department of Transportation and Communications (DOTC) provides the rules under which Uber may offer its app-based ‘amateur taxi’ services, in addition to its higher-level premium services. The new legislation classifies Uber in a new category of service company: ‘Transportation Network Companies’ (TNC).

TNCs participating must provide cars seven years old or less, all possessing navigation and GPS tracking devices, and must be in the category of Asian Utility Vehicles, Sports Utility Vehicles, vans or sedans. Owner-drivers will need to be screened and accredited by the TNCS, although no specifications have been given to the extent or quality of the screening processes involved. They will also need to be registered with the Land Transportation Franchising & Regulatory Board (LTFRB).

As a concession to the inevitably-threatened indigenous taxi ecostructure, the legislation also creates a new category of taxi entitled ‘premium taxi’, which may accept credit and debit card payment, but otherwise follows the same equipment requisites as for a TNC.

The legislation is a rare sign of headway for the controversial San Francisco headquartered company, thought by some to be significantly exceeding the $40bn estimate of its worth. In December China’s own cab-hailing services Didi Dache raised $700mn in series D funding, shortly after Softbank’s $250mn funding injection into China’s GrabTaxi. In the same month the company was rocked by the first in a series of ‘Uber Rape’ scandals, and turned out to be facing a winter of discontent across the Asian region (see ‘Related Links’ below).

The accord with the Philippines has followed the traditional Uber pattern of ad hoc invasion, fierce resistance from existing taxi services which lead to local or national government interventions and sanctions, and then a long period of consultation. The company’s initial arrival in the Philippines was as stormy as any of its other Asian ‘conquests’. Ultimately the very idea of app-hailing is what seems to lead to the willingness to reconsider Uber’s position, with retrenchment seen as the luddite option.

In the official announcement Jun Abaya, secretary of the DOTC, is reported to have said: “We view technological innovation as a driver for progress, especially in transportation where it can provide safer and more convenient commuting options to the public. App-based transport services help address the increasing demand for mobility spurred by rapid urbanization,”

Uber’s own jubilant blog on the development continues the quotes from Abaya: “We are pleased to have collaborated closely with Uber and other tech companies in crafting regulations for a new class of public utility vehicles, which we believe will greatly enhance the convenience and safety of urban transit in the Philippines. These will motivate current PUV operators to modernize, upgrade, and innovate as well. We hope to continue working together in shaping the future of our transport services,”


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