3 days ago
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Undated photo shows a motorcycle rider in Metro Manila.
Philstar.com / File Photo
MANILA, Philippines — Starting April 7, drivers of transport network vehicle service (TNVS) operators and ride-hailing platforms will no longer bear the cost of fare discounts for students, senior citizens and persons with disabilities.
Under Memorandum Circular 2025-10 issued by the Land Transportation Franchising and Regulatory Board (LTFRB), the 20% discount must be equally shared between transport network companies (TNCs) and TNVS operators.
“The TNVS operator and the TNC will equally share (50%-50%) the mandated fare discounts,” the memo read.
TNCs are firms that provide ride-hailing services through applications, while TNVS operators own the vehicles used for these services.
The LTFRB clarified that mandated fare discounts “shall not be passed on by the TNC and TNVS operator to the TNVS-Driver.”
The key difference is that the operator owns and maintains the vehicle, while the driver may be a hired worker who does not own the vehicle used for transport services.
In cases where the TNVS operator also serves as the driver, LTFRB said they will be required to absorb their share of the discount.
Clearing confusion on discount-sharing
The LTFRB’s directive aims to remove inconsistencies in how ride-hailing apps distribute discounts between companies and drivers.
A Philippine Center for Investigative Journalism (PCIJ) report, citing LTFRB data and a Senate hearing, revealed that some firms had passed as much as 80% of the discount burden onto drivers.
For instance, if a ride costs P500 and a passenger avails of the 20% discount (P100), the driver would shoulder P80 while the company covers only P20.
In contrast, another ride-hailing firm was found to split the discount at a 36%-64% ratio between driver and company.
Legal basis for fare discounts
The 20% fare discount is mandated under the following laws:
- Republic Act 9994 or the Expanded Senior Citizens Act of 2010
- Republic Act 10754 or Magna Carta for Disabled Persons, amending Republic Act 7277
- Republic Act 11314 or the Student Fare Discount Act
The LTFRB also cited Memorandum Circular 2015-016-A, amended in 2017, which states that discounts mandated by law “shall be shouldered by the TNC.”
However, the board also noted that in a March 12 decision related to Memorandum Circular 2019-036, TNVS operators were mandated to absorb the 20% fare discount as holders of certificates of public convenience (CPC), recognizing them as the common carriers and primary service providers.
During a Senate public services committee hearing in January, the LTFRB found that ride-hailing platforms used varying formulas for discount-sharing, leading to confusion.
