Home » Breaking News, Customs & Trade, Maritime » BOC to craft order on regulation of foreign shipping lines

The Bureau of Customs (BOC) has created a team that will draft a customs administrative order (CAO) on the registration and regulation of international shipping lines calling the Philippines.

“We will have a separate customs administrative order which will deal specifically with regulation and registration of shipping lines,” BOC Port of Manila deputy collector for Operations Atty. Ma. Lourdes Mangaoang said in a speech during the Supply Chain Management Association of the Philippines general membership meeting on August 18.

Mangaoang said that under Section 1226 of the Customs Modernization and Tariff Act or CMTA (supervision and regulation of third parties), BOC can regulate foreign shipping lines. Under the CMTA, third parties transacting with the bureau on behalf of importers and consignees shall be treated equally as true importers and consignees.

Section 1226 states that the finance secretary, through the recommendation of the customs commissioner, “shall issue rules and regulations to govern and regulate the conduct of all third parties dealing directly with the Bureau in relation to the importation, exportation, movement, storage, and clearance of goods for and on behalf of another person.

Mangaoang noted that third parties refer to logistics service providers, importers, exporters, carriers, airlines, shipping lines, shipping agents, forwarders, consolidators, port and terminal operators, and warehouse operators, if such persons or entities transact with the bureau.

She said this provision “explicitly empowers the Bureau of Customs to regulate the shipping lines,” as they do transact with BOC because the bureau grants them permission to dock.

“So if the bureau issues rules and regulations and they violate these rules and regulations, we (BOC) can prevent them from coming in, from discharging the cargoes,” she stated.

Mangaoang, who is also assistant manager of the CMTA Project Management Office that is drafting the CMTA’s implementing rules and regulations, explained that BOC had already created a draft CAO on the registration of third parties and held public consultations on it.

But BOC decided to create a separate CAO on the registration and regulation of international shipping lines after the bureau conducted a port users’ summit “wherein we realized that there are so many complaints regarding the shipping lines,” Mangaoang said.

Stakeholders have for years raised the issue of alleged exorbitant fees imposed by foreign shipping lines, but it was never clear which government agency had jurisdiction over the lines (or if ever there was any agency that had jurisdiction over them to begin with)–until BOC’s recent port users’ summit where BOC officials pointed out that the CMTA provides the bureau authority to register and regulate shipping lines as third parties.

Mangaoang, however, pointed out that BOC cannot regulate or control freight charges of foreign shipping lines because these are covered by international conventions such as those set by the International Maritime Organization.

But she commented that “the bureau may regulate the local charges by the shipping lines”, citing as examples, fees such as terminal handling charge, container imbalance charge, container deposit, detention, and container cleaning fee.

One recommendation during the BOC port users’ summit that will be considered for the draft CAO is to require a surety bond instead of cash for the container deposit, especially for regular and reliable customers.

Another recommendation for consideration is requiring foreign shipping lines, before they can be registered, to identify specific locations where they can store their empty containers. These locations, Mangaoang noted, need not be owned and could be leased by the foreign shipping lines.

This requirement is also for BOC to monitor the dwell time of empty containers, which under the law can only be admitted into the country duty- and tax-free for three months or 90 days, after which they will be subjected to duty and tax payment, and if not paid, the empties face confiscation by the government.

Mangaoang assured that all stakeholders, including foreign shipping lines, will be consulted during the drafting of the CAO, and that a public consultation will be conducted once the draft order is finalized.

In an interview with PortCalls on the sidelines of the GMM, Mangaoang said they might start consultations on the draft CAO by September. – Roumina Pablo

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