Monday’s order by the Land Transportation Franchising and Regulatory Board (LTFRB) was part of a crackdown on unregistered drivers.
However, frustrated commuters may have some reprieve with the announcement today (Wednesday, August 16) that Arcade City has been activated in the two cities.
Writing on their Facebook page, the makers of the app said: “This has happened before. Arcade City wants to help make sure it never happens again.”
However, today the LTFRB warned Arcade City to cease operations because it was “not authorised”.
Board member Aileen Lizada said: “They have not yet been accredited by the LTFRB.”
In a subsequent statement, the LTFRB told Arcade City to “stop all bookings made” through its app. It warned that “legal actions” would be taken should it fail to do so, and its drivers would be apprehended.
Arcade City has not formally replied to the order, but earlier CEO Christopher David said: “When 66,000 drivers are put out of job overnight, the suffering is not felt by the corporations and bureaucrats who made the decision.
“The suffering is felt by the stranded riders and the jobless drivers who may now have difficulty providing for their families. That is wrong—and Arcade City will do whatever we can to fix it.”
The app was first launched in Austin, Texas, last year after the withdrawal of Uber and Lyft in the city.
Drivers are free to set their own rates and riders are free to choose their own driver.
“Now we bring that peer-to-peer model to the Philippines,” Arcade City said, adding that new drivers were being recruited.
It is estimated that some 200,000 Philippine commuters have been affected by the temporary suspension of Uber.
Uber has offered to pay a fine rather than be suspended. There has not yet been a formal response to its offer. “We are studying the order at the moment. We will update our riders and drivers as soon as we can,” said Uber Head of Communications Cat Avelino.
The Philippines was the first Southeast Asian country to regulate app-based car-hailing operations after drawing up rules in 2015.
Last year the LTFRB suspended the acceptance and processing of applications for all ride-sharing services, including Uber and Grab, to investigate how to regulate the industry.
But both Uber and Grab said they continued to accept new drivers amid strong demand for the service, resulting in a surge in the number of unregistered drivers.
Both Grab and Uber have gained huge popularity in the Philippines, where taxi drivers routinely demand additional payment for longer routes or traffic problems.