Home » Ports/Terminals » 12-14% cargo-handling rate increase proposed

PORT users may soon be charged higher cargo-handling rates by the country’s two main ports, International Container Terminal Services, Inc. (ICTSI) and Asian Terminals, Inc. (ATI).

In an interview at the inauguration of the new K-Line facility for its ship management business last Friday, Association of International Shipping Lines (AISL) president Octavio Katigbak said the association has been apprised of the proposal of the two port operators to increase rates starting this year.

The proposal is now with the Philippine Ports Authority (PPA).

“The rate is between 12% and 14% and could be spread out over the next two years just like what was approved and implemented in 2005 and 2006 when the increase was implemented in two tranches,” Katigbak said.

“It’s now up to the PPA to strike a win-win solution with port users,” he added.

Higher costs have pushed ATI and ICTSI to seek increased rates. Both became qualified to boost their rates after the completion of their two-tranche hike in 2006.

PPA, for its part, said it is expecting petitions for increases not only from ATI and ICTSI but also from other cargo-handling operators.

PPA general manager Atty Oscar Sevilla said the agency will favor the increase so long as they satisfy new requirements.

Under the new guidelines, the application or request for rate increase should be presented in matrix form and show separately the existing tariff, the adjusted tariff applied for and the legal or other justification for such application.

Individual service providers are also required to submit financial statements to include the balance sheet, income statement using appropriate chart of account in accordance with the Philippine financial reporting system; detailed computation of proposed rates; and copies of source documents like government-mandated wage adjustment, increase in power and fuel cost, and exchange rate of the Philippine peso to the US dollar.

Across-the-board increases

For across-the-board increases, the PPA is requiring a detailed computation of the proposed rates as well as copies of source documents such as the consumer price index, wage adjustment orders, increases in power and fuel and the foreign exchange rates.

The source documents should include figures for the year the last increase was granted up to the present year where the adjustment of rate is required.

The PPA Board has the final word on whether to grant the petition for increase or not. It may, however, give provisional approval to an increase pending completion of the review and Board approval.

Once approved, the increase should be published in a newspaper of general circulation 30 days prior to its implementation.

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