In a bid to address port congestion in the Ports of Manila, the Bureau of Customs has ordered the transfer of all empty containers from Manila ports to either the Port of Batangas (POB) or Subic Bay Freeport (SBFP).
Customs commissioner Rey Leonardo Guerrero issued the order in a memo dated Feb 12 but signed on Feb 18. The order noted that Executive Order 172, signed by former President Benigno Aquino III on September 13, 2014, designated POB and SBFP as extensions of the Manila South Harbor and Manila International Container Port (MICP), respectively, in times of congestion and other emergencies.
The Manila South Harbor is operated by Asian Terminals Inc (ATI) and MICP, International Container Terminal Services, Inc (ICTSI).
It must be noted though that under EO 172, the Department of Transportation will have to first declare the existence of port congestion or emergency cases upon the recommendation of Philippine Ports Authority (PPA) Board.
The high utilization of container yards has highlighted the longstanding problem of empty container returns, which had escalated last year due to a confluence of several events. These included bad weather that had led to vessel delays and berthing issues; high yard utilization at container terminals due to the peak season; and trade imbalance (three laden containers coming in against one laden container for export, leading to more empty containers in the country at any given time)—all of which had caused a knock-on effect on the supply chain.
In his memo, Guerrero said the district/port collectors of POB and SBFP have authority over the transferred containers, and that the POM and MICP district/port collectors should transmit all pertinent documents in relation to the transferred containers for immediate processing and disposal.
Such orders are a mere reiteration of a Nov 12, 2015 memo signed by former Customs commissioner Alberto Lina.
Private sector solution
Earlier, Philippine private sector stakeholders have banded together to solve the problem of empty container returns, with some groups vowing to evacuate 10,000 empties on a weekly basis.
The agreements were arrived at this week following months-long reports of much difficulty in repositioning empty containers and after moves by government agencies to craft a joint administrative order (JAO) to address port congestion and regulate international shipping lines’ charges, among others.
The Association of International Shipping Lines (AISL), Alliance of Concerned Truck Owners and Organizations (ACTOO), Container Depot Alliance of the Philippines (CDAP) and ICTSI have agreed to undertake immediate measures to alleviate problems connected with returning empty containers.
In a separate meeting, ATI and several international shipping lines also agreed to collaborate in moving out thousands of empty containers via Manila South Harbor in the next few weeks to also address the build-up of empty containers in the supply chain.
In an agreement signed on February 19 between AISL, ACTOO, CDAP and ICTSI, urgent measures that will be taken include:
- CDAP identifying areas that may be leased to increase empty container storage capacity by 10 hectares. ICTSI will cover the cost of the lease on a market rate basis.
- ICTSI moving 5,000 overstaying containers at the MICP to a bonded warehouse outside, the location of which was not identified. This will help decongest external empty-container depots since MICT will then be able to accept empty containers for evacuation out of the country. The situation will also help truck turnaround return to just one day from two or three days currently, and increase availability of trucks. The move will require additional support from the BOC and PPA.
- ICTSI negotiating the use for one month of the San Miguel Yamamura property near MICP to store and reposition empty containers. The facility has already been earmarked for use of empty containers from April 1.
- ICTSI encouraging the use of its Cavite Gateway Terminal for repositioning of empty containers from south of Manila to MICP. The Tanza, Cavite barge terminal, built on a 6-hectare property can accommodate 115,000 twenty-foot equivalent units (TEUs).
In an email to PortCalls on February 18, AISL general manager Atty. Maximino Cruz said the agreement was an “immediate response to the call of government” during a public hearing led by the Department of Trade and Industry (DTI) on February 14 “to adopt measures in resolving the problem on the return of empty containers.”
DTI, together with the Department of Transportation, BOC, and PPA, on February 14 held a public hearing on the proposed JAO that will regulate local charges imposed by international shipping lines and provide measures to address port congestion.
Meanwhile, in a session hosted by ATI on February 19, international shipping lines have agreed in principle to share vessel resources and immediately evacuate through Manila South Harbor the empty containers in Manila and surrounding areas, the port operator said in a separate statement.
ATI will dedicate ample resources to handling the requirements of the shipping lines so as to ensure a quick turnaround time.
The participating shipping lines, namely, CMA CGM Group, T.S. Lines, Evergreen, Yang Ming, Wan Hai Lines and Hyundai Merchant Marine (Philippines) Co., Inc., will jointly pull out over 10,000 TEUs of empty containers on a weekly basis from Manila South Harbor for recirculation to other Asian destinations. Other major shipping lines may join the initiative in the near future, ATI noted.
Updated on Feb 26 at 11.03am to reflect correct name of Hyundai Merchant Marine (Philippines) Co., Inc.