CONTRACT REF. NO. : SCP3-(Region)-2023-CityName-denom (PUV NET) Case No.

____

SERVICE CONTRACT AGREEMENT

(For LGU OF ________)

This Service Contracting Agreement is executed and entered into for all purposes
and in all respects into this ___ day of ___________________ 2023, by and
between:
The LAND TRANSPORTATION FRANCHISING AND REGULATORY BOARD,
a national government agency created and existing under the laws of the Republic of
the Philippines, pursuant to Executive Order No. 202 S. 1987, with principal office
address at __________________________ herein represented by
____________________________, in his capacity as the REGIONAL DIRECTOR
OF REGION ____, and hereinafter referred to as “LTFRB”;
-and-

The LOCAL GOVERNMENT UNIT of ___________________, with city address

at ______________________________herein represented by its Mayor,
______________________, herein referred to as “LGU”;
-and-
(NAME COOPERATIVE/CORPORATION), with SEC/CDA registration number
_____________________, with principal business address at
____________________________________, herein represented by its duly
authorized representative, (Name of authorized representative), acting for and on
behalf of the Corporation/Cooperative, and hereinafter referred to as the
“OPERATOR”;
-and-
(NAME OF GPS PROVIDER COMPANY), a domestic Corporation registered
under Philippine Laws with principal office address at
__________________________, as represented herein by its duly authorized
representative, (Name of authorized representative), and hereinafter referred to as
the “GPS PROVIDER”;

The LTFRB, LGU, OPERATOR, and the GPS PROVIDER are herein collectively
referred to as “PARTIES” and individually as “PARTY”.

WITNESSETH:

WHEREAS, pursuant to the special provisions of Republic Act No. 11639

otherwise known as the General Appropriations Act of 2022 (GAA 2022) and the
President’s veto message, the Service Contracting Program (SCP) shall be
implemented in partnership with identified Local Government Units (LGUs) to

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facilitate the broad engagement of public transport cooperatives, associations, or

corporations operating within their jurisdiction;

WHEREAS, the LAND TRANSPORTATION FRANCHISING AND

REGULATORY BOARD (LTFRB) is mandated under Department of Transportation
(DOTr) Department Order No. 2020-017 to be the principal Implementing Agency of
Public Utility Vehicle (PUV) Service Contracting Program (SCP).

WHEREAS, the LGU is mandated under Joint Memorandum Circular No. ___
and Memorandum Circular No.___, to act as a co-implementer of the Program within
their respective jurisdiction;

WHEREAS, OPERATOR operates public utility vehicles that have valid

registration with the Land Transportation Office, and are road worthy in accordance
with the DOTr Department Order No. 2017-011 or the Omnibus Franchising
Guidelines, and a holder of valid Certificate of Public Convenience (CPC) or
Provisional Authority (PA).
NOW, THEREFORE, premises having been considered and with
acknowledgment of the mutual promises herein contained, the PARTIES, intending to
be legally bound, hereby agree as follows:

I. DUTIES OF THE PARTIES

A. The LTFRB shall:

1. Provide a Service Plan for onboarded PUV operators;

2. Monitor the submission of SCP reports submitted by the LGU, PUV
operator, and GPS Provider;
3. Coordinate with the LGU for the proper implementation of the Program;
4. Ensure payment to the PUV operators based on the payment scheme
have been complied with in accordance with the labor laws and other
prevailing laws; and
5. Conduct activities, and perform such other functions as necessary for the
proper implementation of the Program, subject to the guidance of the
DOTr and the TWG.
B. The LGU shall:

1. Constitute personnel(s) for the implementation of the Program and for the
monitoring of the performance of the contracted PUV operators vis-a-vis
the Key Performance Indicators (KPI) set;
2. Coordinate with the LTFRB in the strict monitoring of the deployment of
units of qualified PUV operators within its jurisdiction;
3. Coordinate with the LTFRB, and shall provide certification of temporary
rerouting plan or modified route structure, should there be road closure;
4. Conduct stakeholders’ consultations in order to determine the needs and
requirements of the contracted transport service providers, and to
coordinate with the relevant government agencies that can provide the
needed assistance in order to ensure the seamless implementation of the
Program;
5. Shall submit documents and necessary reports as may be required by the
LTFRB in the implementation of the Program;
6. Assist in the resolution of issues and challenges encountered by the PUV
operators, in connection with the implementation of the Program;

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7. Facilitate resolution of issues and challenges encountered by the

monitoring personnel(s) in the implementation of the Program and/or
escalate the same to the LTFRB as may be necessary;
8. Shoulder all operational costs and expenses, in the performance of its
duties and responsibilities under this contract; and
9. Conduct activities and perform such other functions necessary for the
proper administration and efficient operations of the Program, subject to
the guidance of the DOTr and the TWG.

C. The OPERATOR shall:

1. Shall undergo orientation to be conducted by the LTFRB Central Office

(CO) and/or RFRO, prior to their participation in the Program and
communicate the details of the service plan or authorized route to its
drivers;
2. Provide the LTFRB the following:
a. List of authorized units for onboarding;
b. List of names of drivers per consolidated entities;
c. Certification of Payment of the weekly payout; and
d. Other information the LTFRB may require to implement, monitor,
and evaluate the Program;
3. Shall ensure timely payment of salaries and wages to its drivers,
Passenger Assistance Officers (Conductors), and Inspectors in
accordance with the existing Labor Laws and Standards;
4. Execute and submit to the LTFRB an Affidavit of Undertaking to comply
with the conditions of the Program such as but not limited to the payment
of salaries and wages to the transport workers participating in the
Program, and the SCP Service Plan approved by the Board;
5. Ensure that all drivers of authorized units are holders of Valid Professional
Driver’s License with appropriate restriction code, and ensure that only
those authorized units with current registration and valid Private
Passenger Accident Insurance (PPAI) are enrolled in the Program;
6. Ensure that the onboarded units are in good condition, roadworthy, and
strictly comply with the GPS monitoring requirement during the
implementation of the Program;
7. Ensure the availability of 100% of the total number of units onboarded for
every executed contract;
8. Strictly comply with existing and subsequent issuances/policies of the
Board relative to their Certificate of Public Convenience (CPC) or
Provisional Authority (PA), and to any other matters that the Board may
issue in the future which governs the responsibility of the PUV operators
under the Program;
9. Ensure that the authorized units comply with existing LTFRB policies in
the operation of public transportation, specifically in the allowable
passenger capacity; and
10. Submit the Certificate of Payment of Weekly Payout to the LTFRB within
three (3) working days from the receipt of the liquidation report sent via
email.
C. The GPS PROVIDER shall:

1. Provide the PUV operator a certification that a GPS is installed in the

vehicle signed by the CEO/Director of the GPS provider company or duly
authorized representative;
2. Provide the LTFRB and LGU, through its authorized representative/s,
access to its Dashboard/Platform for monitoring purposes and/or real time
monitoring anytime of the day for the entire duration of the Service

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Contracting Program;
3. Monitor that authorized units run within their authorized route structure and
report any deviation thereto;
4. Timely submit the hard copies of the GPS Certification to LTFRB
CO/RFRO which include the following data:
a. Daily kilometer Run;
b. Number of Trips; and
c. Out of Line Operations (if applicable).
5. The GPS Certification must be submitted every Tuesday on or before
5pm. The NCR-based GPS Provider shall submit the hard copies of the
GPS Certification directly to the LTFRB CO, except NCR RFRO. For GPS
Providers based in regional areas, the Certification shall be submitted to
the respective RFRO;
6. Ensure availability of log reports and other similar data relative to the GPS
monitoring for submission to the LTFRB Central Public Utility Vehicle
Monitoring System (CPUVMS); and
7. Shall not connive with its PUV operator and shall not issue false
certifications.

II. TERM OF CONTRACT

This Contract shall commence once the ONBOARDING NOTICE has been issued to
the OPERATOR and shall remain effective until 31 December 2023 or until all the
funds allocated are fully disbursed, whichever comes earlier as may be allowed
by applicable laws and subject to the availability of funds. The LTFRB shall send
a Notice of Termination of Contract once the funds are fully utilized/disbursed.

In case this Contract is extended by reason of a subsequent enactment of a law

affecting the validity and utilization of the funds under RA No. 11639, or the GAA of
2022, a Notice of Extension may be given, and this contract will be amended
accordingly and extended as agreed upon by parties.

III. DOCUMENTARY REQUIREMENTS

Forming an integral part of this Agreement are the following documentary

attachments which shall be submitted by the PUV operator to the LTFRB:

1. Three (3) Original Copies of Duly Accomplished Registration Form with

List of Authorized Units and Authorized Drivers;
2. Three (3) Photocopies of the Application for Consolidation duly received by
the LTFRB and/or three (3) Photocopies of valid CPC or PA of the TSE;
3. Three (3) Photocopies of current OR/CR of the Authorized Units issued by
the LTO;
4. Three (3) Photocopies of valid Personal Passenger Accident Insurance
(PPAI);
5. Three (3) Original Copies of Board Resolution/Secretary’s Certificate
authorizing the General Manager and/or Chairman/President to represent
the cooperative/corporation to sign the SCA;
6. Three (3) Photocopies of valid primary ID of Operator’s General Manager
and/or Chairman/President with three (3) original specimen signatures;
7. Three (3) Original or Certified True Copy of the Bank Certificate [preferably
Land Bank of the Philippines (LBP)] containing Operator’s Bank Account
details; and
8. Three (3) Original Copies of Certification of a GPS installed duly signed by
the CEO/Director GPS.

IV. PAYMENT SCHEME

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A. Regular Payout

Weekly payouts shall be paid on a weekly basis which covers Sunday to

Saturday. Whereas, the payout shall be processed upon receipt of the complete
documents from the LTFRB-RFRO. The payouts shall then be credited to
respective accounts. The weekly payout shall be computed based on the
following computation:

1. Weekly Payout = number of trips per week x rate per trip

2. Rate per trip = route length x rate per kilometer
3. Rate per kilometer = Php 20.00 (TPUJ, FILCAB and TUVE), Php 26.00
(MPUJ and MUVE)

Trip-cutting, fractional or uncompleted trips shall not be considered as one (1) trip,
and thus, shall not be paid.

Moreover, should the TSEs fail to render the required percentage of deployment
per day, the said TSE shall not be qualified to the payout of that particular day.

Should a unit fail to render the required number of trips on a specific day based
on the approved Service Plan, even when the TSE meets the required
percentage of deployment for the day, the non-compliant unit shall be disqualified
to the payout of that particular day.

V. PERFORMANCE-BASED INCENTIVES AND PENALTIES

A performance-based incentive equivalent to 2% shall be paid on top of the

computed weekly payout to the specific unit of TSEs who complies with 80%
deployment of units per day, and the required daily number of trips (one-way) per
unit within the weekly payout as per approved Service Plan.

Failure to render the required percentage of deployment and trips per unit per day
precludes entitlement to performance-based incentives.

VI. PENALTY FOR NON-COMPLIANCE

Strict compliance with every provision of this contract and the services to be rendered
shall be strictly monitored. Failure of the enrolled PUV operator to adhere to any
terms and conditions of this Agreement shall be penalized in accordance with the
existing policies of the LTFRB. The same shall be a ground for the disqualification of
the said PUV operator in similar Programs of the LTFRB.

On the other hand, should the GPS Provider fail to perform its duties and
responsibilities as stated in this contract, the same may be grounds for revocation or
non-renewal of its accreditation.

VII. AMENDMENTS

No amendment or modification of any of the terms and conditions of this Agreement

shall be valid unless evidenced by a written agreement executed by the authorized
representatives of all concerned Parties.

VIII. DATA PRIVACY ACT

The PUV operators hereby authorize the LTFRB to collect, process, record, organize,
update, use, consolidate, or disclose their personal data as part of their personal
information relative to the implementation of the Service Contracting Program and for
purposes related to the said Program such as but not limited to the establishment of

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the Service Contracting Program Dashboard. In view thereof, the PUV operator
hereby freely gives his/her consent for the processing of personal data that will be
used for the implementation of the SCP.

The PUV operators hereby confirms its awareness on rights under Data Privacy Act,
including the right of the LTFRB to terminate the contract should the PUV operators
withdraw its consent or request the removal of its personal information.

The PARTIES hereby agree to conform to the provisions of the Data Privacy Act, its
Implementing Rules and Regulations and related issuances.

Further, insofar as the implementation of the provisions of this Agreement shall entail
exchange of personal data, the PARTIES hereby agree to execute the necessary
Data Sharing Agreement pursuant to the Data Privacy Act.

IX. SEPARABILITY

If any part of this Agreement is declared unconstitutional or void, the rest of the
Contract shall nevertheless remain in full force and effect.

X. ENTIRE AGREEMENT

All Parties acknowledge that this Contract and its Annexes constitute the entire
agreement between them and shall completely supersede all other prior
understandings, previous communications or contracts, oral or written, between the
Parties relating to the subject matter hereof.
IN WITNESS WHEREOF, the Parties hereto have signed this Contract on
_____ day of ________ 2023 at the City of ____________________.

Hon. NAME OF MAYOR/REP.

Regional Director, RFRO __ Mayor/Authorized Representative

LAND TRANSPORTATION LOCAL GOVERNMENT UNIT OF

FRANCHISING AND REGULATORY ____________________________
BOARD

_________________________ ____________________________
POSITION POSITION
AUTHORIZED REP. AUTHORIZED REP.
NAME OF OPERATOR NAME OF GPS COMPANY

Signed in the presence of:

__________________________ __________________________
The parties in the agreement have been duly ascertained by the
undersigned Administering Officer through the attached competent proof of their
identification or government valid IDs.

Notary Public
Doc. No. _____

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Page No. ____

Book No. ____
Series of 2023.