LTO no registration/no travel policy ‘unconstitutional’ according to legal expert.

April 1, 2015

After many false starts, the LTO once again declared war against unregistered vehicles beginning April 1. This has angered new car owners and dealers alike, with many ranting on social media about the ineptness of the agency, but the LTO refuse to back down and instead challenges the dealers to prove that the LTO cannot supply plates within 7 days after receiving the necessary paperwork.

So who is telling the truth? Judging by the reports I’ve received, I’d say both.

Firstly, it is true that the LTO had a major backlog and were unable to issue plates. But it is also true that some dealers have been taking advantage of that fact and not submitting the documents on time and instead waiting for it to accumulate.

LTO spokesman, Jason Salvador, explained to me this morning that dealers have been scrambling to file the paperwork before the April 1 deadline, with some going as far as forging sales invoice dates to so as not to expose themselves.

Then I got this from a reader. "I am at my dealer now following up our plate. Got our car in 2014. Until now we don't have our plate. Was upset as we were made to wait for more than an hour just for the authority to travel. We later learned they had a problem. Our name is not included in the applications they filed in Oct. I demanded for a paper showing na they really applied for our plate sa LTO. Finally they showed us a paper that ours was applied only in Feb. There was also an internal problem with the dealer's Liaison who apparently ran away with the MCs (payment). I'll pm you the screen cap of the papers we got. Apparently, there's a whole bunch of applications that is not on the LTO's application list. The CS we talked to said there's a case filed against their liaison but he has disappeared. More than 200 or 300 LTO applications were lost. I wouldn't know if I didn't insist."

So it seems that with the above case, the LTO are correct in saying that some dealers were either very late in filing or never even filed. So I asked Mr. Salvador again if they can guarantee plates in 7 days, and he assured me that if it is not available in 7 days, it is the fault of the dealer. Period. And if anyone can prove otherwise, the LTO will happily sanction its own.

A very brave statement, so I challenged any dealer to show me any filed papers that have taken longer than 7 days. Within minutes, one very reputable dealer that has two branches agreed to send me their list of vehicles waiting on plates that have been filed longer than 7 days (complete with MV tracking numbers), on the condition that they remain anonymous.

The document shows 229 vehicles still waiting for plates that have had the necessary paperwork submitted and tracking numbers issued as far back as February 14, 2014. It also came with a statement regarding the point about allowing the plates to accumulate so as to save them time and collect them in one hit.

“Dealers are not against the implementation of the No Registration/No Plate no travel rule.  We are questioning the timing.  We actually would like to have this policy in place as it allows us to process our financing and fleet transactions that require the submission of OR/CR for us to claim the proceeds from the banks or claim our receivables from fleet accounts.  Due to the delays in OR/CR issuance, we had problems with collections up to this time as we were at the mercy of LTO to be able to submit the required OR/CR.  You can check this out with the banks and big fleet accounts.  So the accusation by the LTO that dealers were not filing or not following up is false.  We, more than anyone, would like the OR/CR and plates ASAP so we can collect on the proceeds of the sale.  There are manufacturers whose term to the dealer is COD.  We pay for the units even before they are sold.  So the longer the proceeds on sold units stay in receivables, the higher our cost of money practically eroding our profits to near 0 or even negative.”

Or in short, as another dealer chose to sum it up in an SMS to me. “You know that the LTO is full of sh*t right? wtf will I do with plate numbers? I just give ’em out as soon as I get them.”

But the LTO still stand by the fact that many dealers have been remiss and say that there are more than enough plates available. They even showed it to the media. But dealers point out that it is not an issue of the stock of plates but the archaic process to actually get them.

“Initially, factors that affected the quick implementation was the lack of plates.  They were able to address this but then there became an issue with system integration where the LTO system was not initially configured to handle the 3 Alpha 4 numeric license ID configuration.”

Basically the plates are now there but the paperwork and backlog to get them are the biggest problem.

But enough of the he said she said; at the end of the day, motorists seem more concerned about why they are the ones caught up in the middle of it and being penalised, with many questioning the legality of it all.

A fair question indeed, and one that has not yet been properly answered by our government, according to highly respected IP lawyer, Atty Rod Vera.

“Under the 1987 Constitution, no person shall be deprived of property without due process of law. What is this due process? Simply put, due process is a fairness principle. Before any imposition that bans or limits the use of property, the law or rule imposing such restriction must be fair and those affected by it should be given enough notice and a chance to be heard.” Vera says in his column.

He also believes that new vehicle owners have not been given due process and that the new ruling of the LTO is unconstitutional because it restrains the use of legitimately obtained property.

“There’s a law against taking away the enjoyment of your property without justification. This new rule punishes the car owners by making them suffer the negligence of the same agency that issued the new rule. Put this way, if a school was late in releasing their grades, can they prevent students from “moving up” because of non-completion the requirements?”

A fantastic point, but until someone files a case in the Supreme Court, you can only imagine how it will be lost on an enforcer once you start arguing it on the side of the road. So in the meantime, if you are a new car owner that is still waiting on plates, here’s a couple of things you will need to know beginning April 1.

This is a no registration, no travel policy and should not be confused with a ‘no plate, no travel policy; vehicles are allowed to travel without plates, but for a maximum of 7 days. Owners need to carry the original sales invoice in the car proving that it was purchased within the last 7 days.

Only LTO officers or deputised officers with LTO ID can apprehend you. In other words, if your friendly MMDA/MAPSA or other LGU enforcers pull you over, demand for their mission order and LTO ID. If they do not have one or cannot issue you an LTO temporary operator’s permit (TOR) they can NOT, repeat, NOT enforce this memorandum. A TVR (Traffic violation receipt) is not acceptable. Then again, neither is all of this.

About the Author

James Deakin
James Deakin is a multi-awarded automotive journalist located in Manila, Philippines. He has a weekly column in the Philippine STAR's motoring section, is a motoring corespondent for CNN Philippines and is the host of the Philippine motoring television show Drive, which airs every Sunday night at 10pm on CNN Philippines.