QuestionsQuestions (LTFRB MEMORANDUM CIRCULAR NO. 91-003)
To minimize the “trafficking” (sale, transfer, assignment, or alienation) of Certificates of Public Convenience (CPCs) issued by the LTFRB by imposing a one-year prohibition from the date of issuance, subject to stated exceptions.
It prohibits the sale, transfer, assignment, or alienation of a CPC within one (1) year from the date of its issuance.
From the date of issuance of the CPC.
There are exceptions. The Circular provides two enumerated cases where sale, lease, or assignment/transfer is allowed within the one-year period.
If the original CPC holder, if an individual, dies, his or her heir/heirs may step into the holder’s shoes through succession under the law, and the heir/heirs decide to continue the transportation business.
Succession: the heirs step into the shoes of the deceased CPC holder in accordance with the law on succession.
When the original CPC holder sells, leases, or assigns the CPC and the units being operated under the certificate to a duly registered corporation authorized to engage in transportation business where the CPC holder is the majority stockholder; or to a duly registered partnership authorized to engage in transportation business where the CPC holder owns more than one-half of all the combined holdings of the other partners.
The transferee corporation must be duly registered and authorized to engage in transportation business, and the original CPC holder must be the majority stockholder.
The transferee partnership must be duly registered and authorized to engage in transportation business, and the original CPC holder must own more than one-half of all the combined holdings of the other partners in that partnership.
No. Under the second exception, majority stockholder status (for a corporation) or ownership of more than one-half of combined holdings (for a partnership) is required. Without these, the transfer within one year would violate the prohibition.
Yes. The second exception expressly states that the CPC and the units being operated under the certificate are sold, leased, or assigned to the permitted transferee.
It would violate the policy set by the Circular, which prohibits such trafficking of CPCs within one year from issuance, since only the enumerated exceptions are allowed.
It states that it takes effect immediately and supersedes any provision of any existing Memorandum Circular or Board rule or regulation that is inconsistent with it.
Immediately upon adoption/effectivity as stated in the Circular (adopted January 25, 1991).
It was adopted/adopted with signatures of Remedios A. Salazar-Fernando (Chairman) and Board Members Dante M. Lantin and Nabor C. Gaviola.
It indicates that not only outright sale but also other forms of disposition—such as transfer, assignment, or alienation—are covered, meaning any prohibited change of ownership/control inconsistent with the Circular is barred within the one-year period.
It refers to the person or entity named as the holder at issuance; the exceptions specifically reference actions by the original CPC holder (e.g., in death succession or sale/lease/assignment with majority control).