Brokers, truckers threaten legal action over PPA container monitoring order

Brokers, truckers threaten legal action over PPA container monitoring order
A group of truckers and customs brokers claim Philippine Ports Authority Administrative Order No. 04-2021 has no legal basis, encroaches on functions and policies of other government agencies, and contradicts the policy on cutting red tape.
  • Brokers, truckers threaten legal action over PPA container monitoring order
  • Customs brokers and truckers are asking the Philippine Ports Authority to either defer or nullify the compulsory container registry and monitoring system
  • Barring which, the groups said they will avail of legal remedies
  • The groups say the order has no legal basis and contradicts ease of doing business and trade facilitation

A group of customs brokers and truckers is threatening legal action against the Philippine Ports Authority (PPA) if the mandatory container registry and monitoring order is not nullified or at least deferred.

In a letter to the PPA Board dated May 8, the group claimed PPA Administrative Order No. 04-2021 has no legal basis, encroaches on the functions and policies of other government agencies, and contradicts the policy on cutting red tape. It may also “entail the needless loss and dissipation of direly needed government funds…”

The group consists of the Aduana Business Club Inc., Confederation of Truckers Association of the Philippines, and Practicing Customs Brokers Association of the Philippines Inc.

They warned PPA’s failure to heed their demand will push them to seek “all legal remedies, criminal and/or civil, for the correction and/or prevention of the implementation of this patently illegal, baseless, and defective [administrative order].”

READ: PPA proceeds with P877.6M container monitoring project

PPA AO 04-2021, issued last October, prescribes the registration and monitoring of containers entering and leaving PPA ports, including the scheduling, loading, unloading, release, and movement of all containers.

The policy will be implemented through PPA’s Trusted Operator Program-Container Registry and Monitoring System (TOP-CRMS) and Empty Container Storage Shared Service Facility (ECSSSF), which was bid out and awarded last April to a lone bidder. The contract and notice to proceed were issued on May 2.

The group had earlier sought suspension of the bidding for TOP-CRMS and ECSSSF pending consultation with stakeholders.

In its letter, the group said nowhere in Presidential Decree (PD) 857, or the Revised Charter of PPA, gives the agency power “specified or implied” to monitor, register, or regulate containers, specifically those used in international trade.

RA 11032 (Ease of Doing Business and Efficient Government Delivery Service Act), Bureau of Customs’ Customs Administrative Order No. 01-2015 (shortening the period to re-export empty containers), United Nations (UN) Office of Drugs and Crime Joint Port Control Unit Initiatives, UN Office of Drugs and Crime-World Customs Organization Global Container Programs, Title 19 United States Code of Federal Regulations Part 4, and UN/Center for Trade Facilitation and Electronic Business Smart Container Specifications also do not specifically or impliedly allow PPA to monitor and register international containers arriving and leaving Philippine ports.

PPA cannot invoke RA 11032 in the implementation of AO 04-2021, the group said, as the tagging and untagging of the monitoring device in the container “will surely create an additional regulatory burden and cost upon ports stakeholders.”

Moreover, PPA, by invoking CAO 01-2015, “is in effect, trying to arrogate upon itself the sole and exclusive power of the Bureau of Customs over shipping containers coming in and out of Philippine ports.”

AO 04-2021, the group said, encroaches on the powers of BOC, resulting in duplicity in programs as the customs bureau is already monitoring movement of containers. In force since August 2019, CAO 08-2019 provides guidelines and procedures for monitoring and control of movement of all containers, whether loaded or empty, at seaports in the Philippines..

If PPA is bent on registering and monitoring the movement of containers, it can readily secure data from BOC’s Container Control Division and other pertinent customs units, terminal operators, and shipping lines, the group added.

In addition, AO 04-2021 contradicts the policies on ease of doing business and trade facilitation, it said. The policy will add to other systems that already monitor containers, particularly BOC’s Electronic Tracking of Containerized Cargo System and the Manila International Container Terminal’s Terminal Appointment Booking System.

Since there are systems in place to monitor movement of containers, the group said PPA’s budget of P980 million—representing payment for TOP-CRMS and ECSSSF winning bidder–“will just dissipate much-needed governmental funds.”

The group claimed paying P980 million for the system “will expose its [PPA’s] officers to criminal act of graft and corruption in addition to administrative liabilities” due to the lack of legal basis for the system’s implementation.

The contract for the TOP-CRMS and ECSSSF was awarded to the joint venture of NextIX Inc. and Shiptek Solutions Corp., for its bid of P877.6 million, lower than the project’s P980-million budget.

The group also said the one-time public consultation in June 2021 does not “suffice for the drafting and issuance of the subject PPA AO 04-2021 with far-ranging consequences, albeit its baselessness and other grave defects being readily apparent.”

During the June 2021 public consultation, where PPA presented its proposed container registry and monitoring system, trucking organizations and several other industry associations were not present, as confirmed during a recent Anti-Red Tape Authority meeting.

The group also described the P4,900 service fee per container specified under the TOP-CRMS terms of reference “an undue burden on the payee” and a waste of funds given that the system will be a duplication of already existing programs.

Aside from the group, 14 other industry stakeholders have called for the immediate revocation of AO 04-2021, which they described as “uninformed”, redundant and will only create port congestion, jacking up business costs. They also said the policy was issued without proper public consultation.

A public hearing on AO 04-2021’s implementing operating guidelines was scheduled on May 11 but was postponed. No new date has yet been set as of this writing.

PPA Port Operations and Service Department manager Hiyasmin delos Santos, in a recent webinar, said the postponement recognizes the issues raised and the need for PPA to address certain operational issues.

“We’re continuously working to ensure that the policy, once we decide to implement it, would… address not really all but most of the issues raised… Again, our appeal is to give that policy a chance,” Delos Santos said. – Roumina Pablo