On Friday, the Philippine Transport regulator said that they would lift a one month suspension imposed on Uber Technologies Inc. if they were willing to pay a penalty worth $3.7 million. This fine is approximately 20 times more than what Uber had been willing to pay. The LTFRB or Land Transportation Franchising and Regulatory Board said that collectively, Uber also needed to pay 20 million pesos to its drivers daily as financial assistance during this period of suspension. In a statement made by Uber, it said that they were working hard to fulfill the conditions in order to left the suspension and were hoping to resume their services as soon as possible.
Uber’s operations were halted by the regular for a month from August 14th. The company was accused of disregarding the directive of not accepting applications from new drivers. The ride-hailing service said that it did not process any new applications. The company also told the regulator later on that it was willing to pay a fine of 10 million pesos if the suspension would be lifted. The freeze on Uber has garnered public attention because a number of people in the Philippines consider the ride-hailing app as a more competitive and reliable alternative as opposed to mainstream transportation services.
Recently, Uber said that it had about 67,000 drivers in the Philippines. The LTFRB stated that they had calculated the penalty based on the number of days the service should be suspended in relation to the daily income it earns on average. They cited the data that had been submitted by Uber and said that at least 150,000 trips are made on a daily basis by the company and it manages to earn an income of about 10 million pesos. Aileen Lizada, the LTFRB member, said that this fine also included the remaining 19 days of the firm’s suspension period.
Reporters were informed by Lizada that the fine would be lifted when Uber would pay the fine and provide financial assistance to the drivers. Valued at about $60 billion, this dispute with the regulator in Philippine is just the latest setback that Uber has had to deal with this year. Due to its suspension in the Philippines, there was a spike in demand for its competitor in the country, Grab. In addition, it also led to long queues near malls and offices and people were also disgruntled at having to use regular taxis once again.
A notable advocate of improving transport services in the country, Senator Grace Poe, tried to help in working out a compromise between the LTFRB and Uber. An Uber executive apologized for their ‘misunderstanding’. On Friday, Poe said that the hefty fine had been imposed to ensure that Uber re-evaluates its strategy and re-thinks its actions when thinking about testing the government regulations. Last year, the LTFRB suspended applications for ride-sharing operators in order to figure out how to regulate the entire industry. The regulator said that the company had exhibited irresponsible behavior by choosing to challenge them.