Home » Ports/Terminals » New North Harbor operator faces demurrage claims

Domestic carriers also seek non-payment of storage fees, assignment of permanent equipment, labor to each line

THERE seems no end in sight to the troubles facing North Harbor’s new operator, the Manila Manila North Harbour Port, Inc (MNHPI).

The Philippine Liner Shipping Association (PLSA), the port’s main client, last week demanded a stop to the charging of storage fees at the North Harbor following delays in carrier operations due to the operator’s supposed lack of equipment and manpower.

In addition, the association said its members will file for “demurrage claims for all undue delays in the loading and discharge of cargoes from their ships incident to your forcible takeover and operation at the Manila North Harbor .”

PLSA is also demanding that as a result of the “operational mess at the port… permanent equipment and labor be assigned to each shipping company for the purpose of rendering immediate service to inbound and outbound cargoes at the port”.

The association wrote Ferdinand Inacay, MNHPI chief operating officer, three separate letters all dated April 16, 2010 which detailed each of their demands.

In one letter, PLSA executive director Josefina Maitim said, “Due to your fault for lack of equipment and manpower, we demand that all cargoes, whether inbound or outbound, should not be charged storage even if they exceed the two-day free storage period. With the way things are run at the port where there is no plan on how to segregate inbound and outbound containers by origin and destination, timely withdrawals of containers within the allowed period is next to impossible.”

Maitim added, “Even if the shipping companies try to transfer the containers to their offdock CYs to decongest the pier, MNHPI does not have the equipment to service their hustling trucks.”

In addition, the association said even cargoes stored prior to the takeover should also not be charged storage fees.

MNHPI’s takeover of North Harbor from the Philippine Ports Authority (PPA) took effect on April 11, more than three months behind schedule. The turnover has been occasioned by much protest from the labor sector in fear of massive job losses, and shippers who see higher freight rates resulting from the imposition of a 5% concession fee on ancillary services.

Equipment on 24/7 basis

In one of the letters which sought permanent assigment of equipment and labor to each shipping line, PLSA also made reference to the arrastre service requirement of customers withdrawing their inbound cargoes and those delivering outbound cargoes.

“This is in contrast with the stevedoring service which can be scheduled and planned ahead. Equipment and labor cannot be expected to be crossing the stretch of the North Harbor back and forth each time outbound cargoes come into the port,” it said.

“Equipment and labor must be available at the pier on a 24/7 basis. Presently, your delay and inefficiency, as we had all along been objecting to and warned you and the PPA about, is coming to the fore.”

More complaints

Earlier, port users who are mostly clients of PLSA member line NMC Container Lines said a number of vessels have been idled since last Wednesday due to the new port operator’s lack of cargo-handling equipment.

But to add insult to injury, the port users claimed MNHPI continues to collect arrastre fees.

“There is no work on vessels at this time,” they said in a statement released through PLSA and provided to PortCalls.

“MNHPI is unable to move any of the loaded containers from apron to the imaginary demarcation line (IDL) particularly 40-footers, ISO tanks and flat racks,” they said.

“The apron has few empty slots left and unless MNHPI is able to move the containers from apron to the IDL, vessel operations will soon stop completely.”

They added, “MNHPI should be held liable for demurrage claims for excess laytime referenced against productivity standards.”

Apart from NMC Container Lines, affected carriers are Negros Navigation, Sulpicio Lines, Solid Shipping Lines, Lorenzo Shipping Corp and Moreta Shipping Corp. Together, they handle the bulk of passage and cargo traffic at the domestic port.

Oceanic Shipping Lines has been spared from the equipment problem because it earlier leased out its cargo-handling equipment to MNHPI for exclusive use on its cargoes.

Gear problems

In a bid to remedy the equipment issue, MNHPI deployed into service an additional 15-ton forklift but as of this writing the equipment has yet to be used supposedly because the gears currently in place — and which are needed to transfer cargoes from vessels to the forklifts — are lacking.

The domestic shipping lines also said what they in fact need are 25- to 35-ton forklifts, which are also in very short supply.

In addition to complaints on demurrage, there are problems with new MNHPI procedures such as the centralization of cash payment to the MNHPI office in Pier 6, and the centralized issuance of gate passes to truckers/shippers along with the P75 charge per entry that went with it.


Meanwhile, cargo handlers United Dockhandlers, Inc — which controls Piers 6, 12, 14 and 16 — and North Star — which controls Piers 2, 4 and 10 – recently filed a rejoinder to the PLSA case against the port turnover.

PLSA is seeking to invalidate the MNHPI port contract citing questionable provisions, including the imposition of a 5% concession fee on ancillary services. The association also questioned the cargo-handling equipment installed by the new operator, claiming they did not meet the minimum required under the contract.

Pier 8 Arrastre, which controls Pier 8, and the Integrated North Harbor Truckers Association are also set to file their own rejoinders soon. All efforts are designed to force the return of North Harbor operations to before MNHPI took over and until such time the new operator is ready to provide the necessary cargo-handling equipment.

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