24 groups ask Marcos to junk container monitoring policy

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  • 24 business groups have asked President Ferdinand Marcos, Jr. to junk the Philippine Ports Authority’s container registry and monitoring policy
  • In a July 20 open letter, they warned Marcos against “certain vested interests” that “have renewed their push to implement the controversial program to the detriment of Filipinos”
  • The groups said the policy will erase gains made by the administration against inflation
  • The order is deferred indefinitely, awaiting final PPA Board decision

Twenty-four groups are asking President Ferdinand Marcos Jr. to junk the Philippine Ports Authority (PPA) policy implementing the container registry and monitoring system, noting “certain vested interests have renewed their push to implement the controversial program to the detriment of Filipinos”.

In an open letter published on July 20, the business groups urged Marcos to “urgently and explicitly confirm the repeal of PPA Administrative Order No. 04-2021”.

The order prescribes the policy on the registration and monitoring of foreign containers entering and leaving PPA ports. It requires foreign containers to register in PPA’s Trusted Operator Program-Container Registry Monitoring System (TOP-CRMS), an electronic system to monitor and to secure a container insurance policy.

PPA earlier said TOP-CRMS will address the long-standing issue on return of container deposits imposed by foreign shipping lines at the same time manage the return of foreign empty containers.

The business groups said Marcos should “remain vigilant against interest groups putting pressure on his administration to implement a flawed program consistently opposed by public and private stakeholders.”

They said the estimated additional P35 billion cost of importing goods that will result from implementation of the program “could once again drive inflation in the Philippines” and “effectively erase your early gains.”

The open letter was signed by 16 of the 17 business groups that also called on Marcos to scrap PPA AO 04-2021 last January. Foreign chambers of commerce and a few other business groups signed off on the latest letter.

Signatories:

  1. Philippine Chamber of Commerce and Industry
  2. Philippine Exporters Confederation, Inc.
  3. Supply Chain Management Association of the Philippines
  4. Philippine Association of Meat Processors, Inc.
  5. Philippine Multimodal Transport and Logistics Association, Inc.
  6. Alliance of Concerned Truck Owners and Organizations
  7. Alliance of Container Yard Operators of the Philippines
  8. Association of International Shipping Lines
  9. Association of Off-dock CFS Operators of the Philippines
  10. Customs Brokers Federation of the Philippines
  11. Pasig Port Users United
  12. Philippine Liner Shipping Association
  13. Philippine Ships’ Agents Association
  14. Port Users Confederation of the Philippines, Inc.
  15. Practicing Customs Brokers Association of the Philippines, Inc
  16. United Portusers Confederation of the Philippines, Inc.
  17. Philippine Coastwise Shipping Association
  18. American Chamber of Commerce of the Philippines
  19. European Chamber of Commerce of the Philippines
  20. Japanese Chamber of Commerce and Industry of the Philippines, Inc.
  21. Canadian Chamber of Commerce of the Philippines, Inc.
  22. Korean Chamber of Commerce of the Philippines, Inc.
  23. Philippine Association of Multinational Companies Regional Headquarters, Inc.
  24. Semiconductor and Electronics Industries in the Philippines Foundation, Inc.

RELATED READ: Scrap PPA container monitoring system, 17 business groups urge Marcos

Amid opposition from various stakeholder groups the PPA Board has, since January, deferred indefinitely the implementation of the policy.

In a statement sent to PortCalls on July 20, PPA reiterated: “As of now the program’s implementation is still deferred by the PPA Board. We will just wait for the PPA Board’s action on whether the program will be allowed to proceed implementation or not.”

In their open letter to Marcos, the 24 groups said despite overwhelming opposition against PPA AO-04-2021, they were “surprised to receive unconfirmed reports that certain vested interests have renewed their push to implement the controversial program to the detriment of Filipinos.”

This is why the groups also asked Marcos to “admonish public officials who blatantly disregard valid concerns from the private and public stakeholders and who refuse to follow your administration’s ‘whole-of-government approach’ in public administration.”

The groups reiterated several “unresolved issues” against PPA AO 04-2021 and TOP-CRMS, including added direct financial costs from the additional insurance fees, transaction fees, and trucking fees which could bump up the cost of importing goods by as much as 50% or at least P35 billion per year.

Another issue is the duplication of digital container tracking and booking applications of international shipping lines and terminal/off-dock container yard operators. The program is “merely an unnecessary additional layer of bureaucracy that has no clear benefit to the public,” the groups said.

Further, they said PPA AO 04-2021 “will waste precious public funds under the guise of ‘digitalization’ when the Bureau of Customs already has an ongoing World Bank-supported digitalization and modernization strategy to curb smuggling.”

They reiterated PPA has no jurisdiction over the issue of container deposits. Currently, no government agency has jurisdiction over foreign shipping lines, which impose the container deposits.

In addition, the groups said PPA should not preempt action being taken by the legislative branch of government via House Bill No. 04933. The measure seeks to strengthen the oversight function of relevant government agencies over the imposition of charges – including container deposits – by international shipping lines.

The bill is being deliberated upon by a technical working group of the House Committee on Transportation while a counterpart bill at the Upper House, Senate Bill No. 2147, is pending.

The groups said AO 04-2021 “will potentially open the opportunity for the anti-competitive control and abuse of sensitive business data by a company that competes with other enterprises in the logistics space.”

To date, they noted PPA has yet to undertake a competition impact assessment of AO 04-2021 despite its “clear obligation under AO No. 44.” AO 44 directs the adoption and implementation of a national competition policy by all government agencies, including government-owned and controlled corporations such as PPA.

The groups also claimed that AO 04-2021 was “approved prematurely without understanding the sector’s issues.”

They said that as admitted by PPA officials, “the system cannot be designed unless [they] know what the problem is or what the challenges are.”

“Sadly, after almost two years since the issuance of AO 04-2021 on September 22, 2021, PPA’s management has still not figured out the issues in 2023 as TOP-CRMS’ ‘objectives’ and Implementing Operational Guidelines [IOG] kept changing every now and then.”

Further, the groups said AO 04-2021 disregarded best practices in other countries with large container ports, such as Singapore, on alternative ways to implement the program’s supposed objectives.

They claimed the “lack of transparency, misleading claims, and inaccurate reports over the status of the PPA AO 04-2021 and its ever-changing draft IOG have put a cloud of uncertainty on the logistics market.”

“We fear that the continued ambiguity will also lead to insecurity in the supply chain of essential commodities.” – Roumina Pablo