The Philippine Ports Authority (PPA) approved the increase under PPA memorandum circular 04-2013 dated May 20 but published on May 25. It takes effect 30 days after publication.
PPA general manager Atty. Juan C. Sta. Ana granted the tariff hike, which will apply to all foreign and domestic cargoes. The adjustment excludes roll-on/roll-off terminal fees and cargo-handling rates under special takeover units scheduled for bidding.
Local shipping lines and other affected parties are planning to meet this week to discuss how they would react to the PPA decision, which one industry source said “caught us by surprise”, as public hearings on the tariff hike petition are still ongoing.
Under the circular, Sta. Ana, however, cited PPA BoardCom Resolution No 2013-1336 dated April 11, 2013 and Item 7 of Memorandum Circular 11-2007 (Revised Rules in the Conduct of Public Hearing for Rate Increase) as empowering the PPA general manager to grant a provisional rate hike pending completion of a public hearing.
The circular said the provisional increase is a “cost recovery measure due to (the) surge in operating costs in the CH (cargo-handling) industry, such as labor, power, fuel and repairs and maintenance”. The last increase was granted in 2008.
The upward adjustment will be “granted to all cargo handling operators (CHOs) nationwide who have individually petitioned and submitted the required matrix of operating expenses to include the supporting schedules certified and sworn as having been lifted from the audited financial statements and validated by the concerned Port Manager.”
The “initial evaluation of the CHOs’ financial condition indicates at least a 10% adjustment,” the circular said. “Furthermore, pursuant to Article II, Item 3 (c) of PPA Administrative order No. Q1-2006, an interim across the board cost recovery adjustment may be granted using the Consumer Price Index (CPI) formula.”
The PPA Commercial Services Department will make necessary adjustments in the existing cargo-handling tariffs of all qualified CHOs 15 days after May 25, the circular said.
In 2011, the Philippine Chamber of Arrastre and Stevedoring Operators Inc filed a petition for a 30% increase in cargo-handling services and 20% for containerized cargoes.