Increased
paid-up capital for vessel operators looms
THE Maritime Industry Authority (Marina)
intends to increase the paid-up capitalization of all
vessel operators to make sure they can maintain their
business.Marina administrator Vicente Suazo, Jr. explained
the existing capitalization requirements for shipping
companies are too small to support operations."We
are increasing the paid-up capital of shipping lines
to ensure that they can sustain their operations. We
have to make sure that they have enough money,"
Suazo said.
The impending directive aims to avoid a repeat of what
happened to the country's oldest domestic carrier Negros
Navigation. The carrier experienced a huge cash shortfall
and could not draw from its capital, forcing it to file
for a court-determined rehabilitation program.The present
capital requirement for shipping companies is P500,000;
the other capital requirement is based on the vessel
it intends to operate.
Suazo said Marina would like to increase the amount
to a certain percentage that would allow support of
vessel operations."If you have no money, maintenance
of your vessel will be affected," Suazo stressed.Marina
is now conducting public hearings to educate shipping
operators on the need to increase the capitalization
requirements.The agency intends to implement the new
conditions within the year in a bid to ensure viability
of shipping lines and to promote safety.
CTAP:
Higher-than expected trucking rate hike due next month
THE Confederation of Truckers Association
of the Philippines (CTAP) will increase its rates as
early as next month.CTAP President Rodolfo De Ocampo
said the asscoiation will be forced to implement a higher-than
expected rate increase due to rising fuel cost and the
impending implementation of RA 8794 or the No Overloading
Law on August 1.
He said that the law, when enforced, will translate
to added operational cost since truckers will be compelled
to limit their load to the allowable weight, in the
process using more trucks and burning more fuel."Definitely,
there will be an upward adjustment in trucking rates.
As early as next month, we will announce our rate increase,"
De Ocampo stressed.When the law is implemented, 10-wheeler
trucks - which can carry up to 25 tons of loose cargoes
and 30-tons of containerized cargoes - will only be
allowed to carry about 20 tons of containerized and
loose cargoes.
"We are still determining the rates based on the
allowable weight that will be permitted by the government
but the rate will be higher than the earlier reported
rate increase," de Ocampo explained.Earlier, CTAP
announced it is jacking up trucking rates by about 25%
to stay afloat."We cannot keep up anymore. A rate
increase proposal has been pending since February this
year," De
Ocampo said, adding that the continuous rise in spare
parts has also contributed to truckers' woes.
CTAP members account for about 30% of the country's
total trucking population. The truckers' last rate increase
(20%) was in June 2004 following consecutive increases
in the prices of fuel and toll fees imposed by the Metro
Manila Tollway Corporation in October 2004.
De Ocampo noted that the same factors are the driving
force to the proposed increase. "These include
the major improvement done at the North Luzon Expressway,
which implemented its own toll fee increase within the
first quarter. And then the price of oil is still unstable,"
he added. Fuel comprises 40% of a trucker's overhead
cost. The price of diesel per liter has notably gone
up, from P20 to about P29 or a whopping 40% hike in
less than a year.Due to high fuel prices, suppliers
also increased prices of spare parts, tires, batteries
and lubrication oil."Our business depends heavily
on the maintenance of our trucks, so we are really affected
by these increases," De Ocampo said.
BEFORE the end of this year, the Philippine
Ports Authority (PPA) hopes to edge closer to completing
computerization of all port operations in the country.The
PPA said it is hoping Project PROMPT (Providing Reliable
Operation and Management of Ports through Technology)
will help the Philippines keep up with international
port standards.
"Nowadays, port authorities all over the world
are linking with each other to establish e-port communities
that will facilitate transport, trade and commerce.
Upon completion of PROMPT, PPA will be fully enabled
to deliver port services that are at par with international
standards," the PPA said in a progress report on
the program.As of July 2005, the key components of the
program have been implemented in the PPA head office
and some port district offices and port management offices.
These include the PDOs in Manila, North Luzon and Southern
Luzon, and the PMOs in North Harbor in Manila and in
Batangas.
With PROMPT, the PPA said it will eliminate redundant
and tedious manual steps, and its operations will be
less prone to errors.PROMPT will also facilitate integration
and consolidation of data and information, thus streamlining
business processes, the PPA added."It is a crucial
move towards achieving satisfactory compliance with
Republic Act 8792," it said, referring to the Electronic
Commerce Act signed by then President Joseph Estrada
in 2000.
The PROMPT project aims to improve mission-critical
systems and business operations of the PPA by automating
information processing and enhancing financial, operational,
administrative and engineering management controls.It
also elevates the PPA's technological capabilities,
bringing it closer to developing an electronic port
(e-port) community.
"The vision of e-Port is to provide a common trade
facilitation platform interconnecting all members of
the Philippine port user community and subsequently
become part of a global information network link to
other port community systems abroad," the PPA said.PROMPT
will focus on six mission-critical systems, with the
PPA head office hosting the systems. In turn, the systems
will be made available to other nationwide offices.
First of the six mission-critical systems is the port
operations management system (POMS), which includes
vessel berthing assignment, manifest recording, export
declaration recording, invoicing, electronic bill presentment
and receipting.Second is the inventory and engineering
management system (IEMS), which aims to improve PPA
efficiency in engineering-related tasks. Its components
include the project/job management system and the engineering
records system.Third and fourth systems involve accounting
and financial management system (AFMS) and legal support
system (LSS).
Fifth and sixth systems involve real estate management
system (REMS), which efficiently manages PPA's land
and building assets for lease; and executive information
system (EIS), which aids top management in monitoring
the performance of various functional areas."It
may not provide a total solution to the complete automation
requirements of organizational operations, but it will
provide vast opportunities to further streamline and
redefine organizational work processes, thereby enabling
PPA to further fulfill its mission of providing reliable
and responsive services in Philippine ports," the
PPA said.
THE Philippine Interisland Shipping
Association (PISA) faces a blank wall whether the value-added
tax (VAT) exemption provided under Republic Act 9295
or the Domestic Shipping Development Act was retained
when the expanded VAT law - silent on the issue - was
signed.
The largest domestic shipping association has already
asked the Bureau of Internal Revenue (BIR) for an opinion
on the issue.
RA 9295 exempts vessel operators from payment of VAT
when importing a new vessel and its spare parts as long
as the vessel is within the age condition of the law.
The new VAT law, on the other hand, removed all tax
exemptions.The Filipino Shipowners Association (FSA)
also faces the same problem since its members, too,
are exempt from paying VAT for 10 years starting this
year.
The FSA said removal of the VAT exemption will be a
big blow to business. The association sought the exemption
to achieve greater cash flow for fleet modernization
and to boost the number of vessels flying the national
flag.Maritime Industry Authority (Marina) is certain
that the incentives and tax breaks given by both RA
9295 and RA 9301 remain.
"Yes, the new VAT law somehow repealed all laws
giving exemptions but it does not state there anything
about shipping," Marina administrator Vicente Suazo,
Jr. explained, adding that the law mentioned lifting
of exemptions for such industries as power and oil "but
nothing about shipping."
