Customs Commissioner John Phillip Sevilla has approved the transfer of two x-ray machines in Cagayan de Oro, currently within a designated examination area (DEA) operated by a private operator, to within the premises of the Mindanao Container Terminal (MCT), a welcome development for the local business community which has long pushed for the move.
Customs Deputy Commissioner for Intelligence Group Jessie Dellosa confirmed the decision in a text message to PortCalls.
The development follows a public forum held last week in Cagayan de Oro attended by the BOC leadership, including Dellosa, Deputy Commissioner for Assessment and Operations Coordinating Group Atty. Agaton Teodoro Uvero, Deputy Commissioner for Enforcement Group Ariel Nepomuceno, and local port stakeholders.
The stakeholders aired their concern over the location of x-rays being outside the MCT, and how this has led to double charges for importers whose containers subject to x-ray inspection have to hauled from MCT to the DEA.
Dellosa said BOC is transferring the x-rays to within the MCT premises precisely “to avoid additional expenses (for) importers/brokers.”
How fast the actual transfer will be is “up to the (Cagayan de Oro) district collector (Atty Ruby Alameda),” said Dellosa, adding that he has already instructed Alameda to operationalize the move.
Dellosa clarified that the “DEA is still there, it’s only the X-ray that will be taken out from DEA. They (DEA private operator) don’t have a contract with BOC only with Phividec.”
Phividec is the Phividec Industrial Authority, a government-owned corporation that manages, administers and supervises the 3,000-hectare Phividec Industrial Estate in Misamis Oriental (PIE-MO), where the MCT is located. PIE-MO is located in the Municipality of Tagoloan and Villanueva, Misamis Oriental, and is one of the largest industrial estates in the Philippines. It is a hub for big locators and exporters such as Pilipinas Kao, Philippine Sinter Corp., San Miguel Foods, Limketkai Manufacturing Corp. and many others.
Industry clamor
In August, the PIE-MO Industries Association wrote to Commissioner Sevilla asking for, among others, the transfer of the DEA back to within MCT premises. PIE-MO Industries Association groups locators within the Phividec Industrial Authority economic zone.
The petition, also submitted to President Benigno Aquino III and other government agencies concerned, was signed by various other business organizations in Northern Mindanao, including the Philippine Chamber of Commerce and Industry (Northern Mindanao), Cagayan de Oro Chamber of Industries, Cagayan de Oro Fil-Chinese Chamber of Commerce and Industry, Cagayan de Oro Chamber of Commerce and Industry Foundation, Misamis Oriental Fil-Chinese Chamber of Commerce and Industry, and Philippine Exporters Confederation Region 10.
The petition was partly a result of the Mindanao Shipping Conference organized by PortCalls in Cagayan de Oro City in June. At the conference, shippers also complained about the location of the x-rays. Deputy Commissioner Uvero, who was a speaker at the conference, even then told participants the transfer was “doable”.
At the same conference, PIE-MO Industries Association president Augustus Adis included the relocation of the DEA in the private sector wish list he presented. Adis said the transfer would eliminate double handling charges. The ideal situation, he noted, was for the x-ray machines to be within the MCT so that cargoes for x-ray screening need not leave the zone and no additional charges are incurred.
Only in Cagayan de Oro
Opened in mid 2013 during the term of former Customs Commissioner Rozzano Rufino Biazon, the DEA in Cagayan de Oro is run by a private company under a five-year contract with the Phividec.
There is no other place in the country with a DEA run by a private entity in a private area outside the port premises. This, business groups said, is an arrangement “prone to corruption.”
Under Executive Order No. 592 signed on 2006 and which established the non-intrusive container inspection system, x-ray inspections should be confined inside the port area, pointed out the business groups.
Davao port previously had a similar DEA setup but the area was closed due to a controversial tiff between the owner of the container yard on which the DEA sits, and the then Davao district collector.
In a related development, Dellosa said Commissioner Sevilla also approved the transfer of one x-ray unit from the Davao Sasa port to the Davao International Container Terminal in Panabo City.
Alleged irregularities
The request to conduct cargo inspections inside the MCT stemmed from observations by port users of alleged irregularities taking place in the DEA after it was placed outside the MCT.
PortCalls sources said some shipments are being scrutinized at the DEA, even those accredited under the green or super green lane program. And while each examination reportedly costs P10,000 per container, BOC does not earn from these examinations; it only collects rental from the DEA operator.
Other PortCalls sources said the volume at MCT is declining because shippers no longer want to ship through MCT because of the potential double charging.
MCT’s container traffic declined 9.4% in the first nine months of 2014 to 150,530 twenty-foot equivalent units (TEU) from 166,159.75 TEUs year-on-year.
Ship calls also decreased 7.96% to 312 from 339 vessels in the same period last year.
For the entire 2013, MCT handled 217,843 TEUs, a record high since 2006 and representing 80.68% of its annual capacity of 270,000 TEUs. – Roumina Pablo
