Hontiveros seeks probe on ‘excessive’ rise in port fees

Hontiveros seeks probe on ‘excessive’ rise in port fees
  • Senator Risa Hontiveros has filed a resolution seeking to investigate Philippine Ports Authority policies that allegedly led to “excessive” rise in port fees and charges
  • Senate Resolution No. 484 calls for an inquiry into “increased logistics costs in the Philippines caused by rising port fees and charges”

Senator Risa Hontiveros is seeking a probe on “excessive” rise in port fees and charges supposedly from Philippine Ports Authority (PPA) policies.

In Senate Resolution (SR) No. 484, the solon called for an inquiry into “increased logistics costs in the Philippines caused by rising port fees and charges.”

PPA orders cited in the resolution include PPA Administrative Order (AO) No. 12-2018, AO 12-2019, AO 01-2020, and AO 04-2021.

AO 12-2018 provides guidelines for selecting and awarding port terminal management contracts under its Port Terminal Management Regulatory Framework (PTMRF). PPA has been bidding out port terminal management contracts under PTMRF since 2020. Ports where new operators have taken over are implementing a new tariff matrix provided in PPA AO 10-2019.

RELATED READ: PPA bares guidelines for awarding of port management contracts

Stakeholders have been asking for the suspension of the new tariff as these are said to be 300% higher than the previous rates.

AO 12-2019 provides for the imposition of a central ticketing system, an online application procedure that would support an integrated vessel booking and payment system for roll-on/roll-off ports.

Stakeholders earlier claimed the project would be “redundant,” “impractical,” and an additional cost to the public. The PPA has yet to implement its electronic terminal management system (ETMS) project, which is pursuant to AO 12-2019, although PPA general manager Jay Daniel Santiago said he expects to start adoption this year. A review of the system remains pending with the PPA Board.

RELATED READ: PPA bent on implementing container monitoring system within the year

Meanwhile, AO 01-2020 prescribes the collection of a waste reception fee at all PPA ports.

AO 04-2021 prescribes the policy on the registration and monitoring of foreign containers entering and leaving PPA ports. It requires foreign containers to register in the Trusted Operator Program-Container Registry Monitoring System (TOP-CRMS) and to secure a container insurance policy. The controversial policy has been opposed by various stakeholders and business organizations, saying it will result in an almost 50% increase in the cost of importing goods or in real terms an additional annual import cost estimated to be at least P35 billion.

Other groups add the system will worsen inflation, will not solve port congestion, and is a “clear usurpation of Customs function.”

The implementation of AO 04-2021 has been deferred indefinitely by the PPA Board following active opposition from stakeholders.

“These administrative orders are causing distress not only to the shipping operators but also to ordinary consumers. An increase in shipping costs poses a risk of further raising already burdensome pricing and inflation. This may affect how importers price their products. And in the end, it is the general public who will be hit by the biggest blow,Hontiveros said.

The Philippine Coastwise Shipping Association said the PPA policies caused “an increase in port charges within the country as much as 2,000%, thus increasing domestic logistics costs to the detriment of the public.”

It added their group has requested the Department of Transportation to evaluate port terminal management contracts that allegedly raised rates in ports in Ozamis, Ormoc, Zamboanga, Tagbilaran, Surigao, Tacloban, Legazpi, Calapan, Nasipit, and Matnog.

For her part, Hontiveros said: “An efficient maritime transport network is of critical importance to our economy. Even the National Economic and Development Authority recognized that shipping costs are too high and they are a threat to national development. I urge my colleagues in the Senate to look into these increases immediately, recommend the regulation of these rates, and introduce port reforms to address inefficiencies, if necessary.”

SR 484 has been referred to the Senate Committee on Public Services.