ARTA launches project cutting red tape in logistics sector

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  • Project NEHEMIA eyes cutting government requirements on logistics sector
  • Cargo trucks to eventually use Unified Logistics Pass, integrating all “sticker requirements” imposed by local government units, among others
  • Application process for starting a trucking business to be centralized
  • Requirement for notarized documents may soon be a thing of the past
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The Anti-Red Tape Authority (ARTA) has launched a program seeking to reduce bureaucratic requirements imposed by Philippine government agencies on the logistics sector, particularly land transportation.

ARTA envisions as the program’s “ultimate result” integration of all “sticker requirements” imposed on cargo trucks by all concerned government agencies, including local government units (LGUs). These sticker requirements will be integrated into a Unified Logistics Pass (ULP) that governing entities in areas where cargo trucks pass through should honor.

The program also aims to centralize into one platform the application process for starting a trucking business.

These initiatives are all part of ARTA’s National Effort for the Harmonization of Efficient Measures of Inter-related Agencies or Project NEHEMIA. Launched last March, Project NEHEMIA is a sector-based streamlining effort that involves both capacity building with identified agencies and public hearings with stakeholders regarding existing and new regulations.

READ: ARTA program to cut red tape in priority sectors by half in one year

Logistics is one of five sectors included in the first phase of Project NEHEMIA, a program that aims to reduce within 52 weeks the time, cost, requirements, and procedures involved in government transactions in sectors of economic and social significance.

READ: ARTA: Trading, transpo among priorities for gov’t streamlining

Stifling efficiency

During the virtual launch of Project NEHEMIA for the logistics sector on October 20, ARTA director general Atty. Jeremiah Belgica said the sector “currently requires a regulatory environment that encourages, rather than stifles, efficiency and competitiveness.”

“An efficient logistics sector contributes to trade performance and economic development simply by lowering transaction costs and creating more customer value, thus, providing firms an opportunity to increase their earnings and enhance their competitiveness,” he added.

ARTA deputy director general Atty. Ernesto V. Perez, in a presentation during the launch, said the target is to substantially reduce procedures/steps by 73% for the land transport sector, from 209 steps to just 56 steps, and the time by 87% from 271 days to just 35 days.

Citing World Bank-International Finance Corp. figures, Perez said this reduction will lower land transportation cost—including tariff to companies and professionals/middlemen, and opportunity costs—by P1.920 billion to P378.834 million from the pre-reform cost of P2.229 billion.

Proposed reforms include streamlining of procedures, which will be the precursor for the eventual automation of process that will allow for online filing, processing and payment.

Processing of applications will be integrated into ARTA’s Central Business Portal (CBP) to allow agencies to share their documents within one platform and eliminate redundant requirements.

CBP, to be launched in November, is a consolidated platform that will receive applications and capture application data involving business-related transactions.

Goodbye notarization

Another reform, which Perez said is a significant step towards streamlining procedures, is the removal of the requirement to notarize documents for application in order to reduce processing time by at least two days. He explained that notarization is not a legal requirement as basic law provides that “once a private document is submitted before a government agency, that private document is converted into a public document;” hence, the non-requirement for notarization.

Lastly, the project aims to integrate all sticker requirements of all government agencies and LGUs into a ULP or QR code sticker, the system for which will be provided by the makers of the RapidPass.

RapidPass is an online system launched last April to provide frontliners and Allowed Persons Outside of Residences quick passage through checkpoints in Metro Manila during community quarantine periods.

For the ULP project, Perez said the Land Transportation Franchising and Regulatory Board (LTFRB) has agreed to be the “root regulator” that will accept the sticker requirements of concerned agencies and be the system owner of the ULP.

The ULP will have to be honored and recognized by LGUs and police forces in areas where trucks pass from point of origin to destination. The ULP will also be connected to the Bureau of Customs’ Electronic Tracking of Containerized Cargo and the Philippine Economic Zone Authority’s scanning system.

Perez noted in particular how LGUs, despite a Department of Local and Interior Government (DILG) order in 2006 to stop issuing pass-through stickers, continue to require cargo trucks to pay for passage through LGUs’ jurisdictions.

Stakeholders, especially truckers, have been complaining about these pass-through fees collected by every LGU, especially those in Metro Manila, from trucks that pass through their areas.

DILG undersecretary Epimaco Densing III, during the same launch, assured their department will be “reiterating through a memorandum circular that local government should not do this anymore.” DILG has earlier noted that pass-through fees are illegal, although LGUs have been said to be creative in imposing their charges.

After land transportation, Perez said Project NEHEMIA for the logistics sector will be expanded in 2022 to cover water and air transportation.

The Department of Transportation is the lead for the logistics sector, and member agencies include BOC, Civil Aeronautics Board, DILG, Department of Trade and Industry, LTFRB, Land Transportation Office, PEZA, and Philippine Ports Authority. – Roumina Pablo