PPA: BOC order shouldn’t encroach on PPA power over warehouses inside ports

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The Philippine Ports Authority (PPA) is recommending revising some provisions of a draft customs administrative order (CAO) under the Customs Modernization and Tariff Act (CMTA) to clarify jurisdictional issues with the Bureau of Customs (BOC).

The revision will also ensure the order does not allow BOC to duplicate PPA’s power to regulate operation of and impose rates on warehousing and storage service providers within ports.

In a position paper dated June 22, PPA “recommends revision of the language to reflect the provisions of Republic Act No. 10863 or the Customs Modernization and Tariff Act (CMTA), particularly Section 804” as the language might imply that BOC will issue the guidelines for storage rates as well.

The position paper is commenting on the second draft of the CAO that implements several sections of the CMTA and provides guidelines for establishing, maintaining, and operating customs facilities and warehouses (CFWs). The second draft, which amends the first draft issued in April, underwent public consultation on June 22.

READ: Revised draft order lays down conditions for establishing PH customs facilities

According to the draft CAO, “When the business of the port and trade requires such facilities, the District Collector, subject to the approval of the Commissioner, shall designate and establish customs facilities and warehouses for the storage of imported goods or for other special purposes.”

All CFWs, including their expansion, extension, and additional facilities are to be considered as part of customs premises. Thus, they are to be supervised and controlled by the district collector, who will impose the conditions needed to protect government revenue and the goods stored in these CFWs.

PPA said CMTA “has neither repealed nor superseded the jurisdiction of port authorities over port operators, such as those who provide warehousing or storage services.”

“The BOC’s authority over the warehousing or storage service providers is for enforcement of customs and tariff laws. BOC does not, however, provide for the said services as this is a function of the port authority or the port operator, as the case may be,” PPA said, referencing Presidential Decree No. 857.

It added that PPA already has existing guidelines regulating the operations of warehousing/storage service providers within port premises.

The port authority noted that Section 804 of the CMTA provides that the BOC may impose an annual supervision fee on operators of CFWs and customs-bonded warehouses (CBW), but it does not provide for the imposition of rates on warehousing and storage services.

PPA also recommends revising the language in Section 4.2 of the draft CAO and deleting the part that states “as part of customs premises” so as to reflect concerned sections under CMTA and “for clarity and to provide guidance to the stakeholders, whether public or private, that the issuance of guidelines relating to the operations of a warehouse/storage service provider is still with the concerned port authority.”

A revision of Section 4.4.1 of the draft CAO is also being suggested to clarify that the storage period, storage rates, and penalty for violations are under the jurisdiction of port authorities.

“PPA is of the view that the BOC may exercise its authority over CFWs for purposes of enforcement of Customs and tariff laws. The issuance of guidelines as to storage period, rates, and penalties are operational concerns of a port, and the same do not necessarily involve customs enforcement,” the port authority said.