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HomeBreaking NewsHouse committee backs bill prohibiting imposition of local charges by international carriers

House committee backs bill prohibiting imposition of local charges by international carriers

  • The Lower House Committee on Transportation has recommended approval of House Bill No. 10575
  • The bill strengthens oversight functions of government agencies over the shipping charges imposed by international shipping lines
  • HB 10575 prohibits imposition of local charges or surcharges–except for internationally accepted surcharges, fees for value-added services, and behavioral charges such as late payment fee and container insurance–by international shipping lines or their agents, freight forwarders and NVOCCs on Philippine consignees and shippers
  • HB 10575 will require all port or terminal operators, international carriers, NVOCCs, and freight forwarders to inform the Maritime industry Authority of their regular shipping charges and fees and publish these in a newspaper
  • Container deposits may be imposed only under certain conditions, according to the bill
  • No detention charges in the return of empty containers should be imposed by shipping lines when the delay is caused by carriers
  • The MARINA Board is mandated to formulate a National Logistics Efficiency Policy to guide in formulation and issuance of rules of implementing agencies

The Lower House Committee on Transportation (COTr) has recommended approval of a bill that seeks to strengthen government oversight functions over shipping charges imposed by international shipping lines operating in the Philippines.

House Bill (HB) No. 10575 prohibits the imposition of local charges or surcharges — except for internationally accepted surcharges, fees for value-added services, and behavioral charges such as late payment fee and container insurance — by international shipping lines or their agents, freight forwarders, and non-vessel operating common carriers (NVOCCs) on Philippine consignees and shippers.

The imposition and parameters or such imposition must also be clearly defined in the contract of carriage and subscribed by the shipper or consignee, according to the draft bill.

Moreover, no new or initial rate or change in the existing rate that increases the cost for the shipper may become effective earlier than 30 days after filing with the Maritime industry Authority (MARINA), except when allowed by the maritime authority.

In Committee on Transportation Report No. 1366 dated December 6, COTr chairperson Edgar Mary Sarmiento recommended the approval of HB 10575 as a substitute for HBs 4316 and 4462. HBs 4316 and 4462, filed in 2019, aim to regulate and standardize the local charges imposed at both origin and destination by foreign shipping lines.

READ: House bills propose standardization of foreign carriers’ charges

HB 10575 covers “all aspects affecting the imposition of shipping charges by international carriers arriving at or originating from Philippine ports.”

It aims to promote transparency by mandating all port or terminal operators, international carriers, NVOCCs and freight forwarders to inform MARINA of their regular shipping charges and fees and publish them in a newspaper of general circulation.

Under the bill, no charges or fees should be imposed beyond the published rates.

No detention charges in the return of empty containers should be imposed by shipping lines when the delay is caused by the carriers. Any demurrage fee or detention charge should not constitute a direct or indirect lien on container deposits or on other cargoes or shipments covered by a separate transaction of the same shipper or consignee.

Container deposits

MARINA may allow container deposits only in the following circumstances:

  • If the freight forwarder or agents of international shipping lines implement an expeditious procedure for refunding the deposit within a non-extendable period of 15 days from the return of the container.
  • There are clear and fair standards for deduction made known by the freight forwarders or agents to the other party prior to the engagement.
  • There is actual proof that a container deposit has been paid before any deduction is made.

HB 10575 requires that certified copies of all existing agreements made between and among international carriers operating in Philippine ports that affect maritime trade should be submitted to MARINA. MARINA is authorized to review whether the agreement or amendment could unreasonably reduce transportation services or increase transportation cost, and refer it to the Philippine Competition Commission (PCC) for appropriate action.

HB 10575 prohibits international carriers and their agents, and port or terminal operators to operate under an agreement that has been suspended through an order of a proper authority, or a temporary restraining order, or rendered ineffective by injunction issued by the court.

Moreover, the measure prohibits international carriers and their agents, port or terminal operators, freight forwarders, NVOCCs, or logistics service providers, either alone or in connivance with one another, to directly or indirectly charge, demand, collect, or receive greater, less or different compensation for transporting property or for any related service other than the rates and charges in the service contract or those published and filed with MARINA.

International carriers and their agents, port or terminal operators, freight forwarders, NVOCCs, or logistics service providers, either alone or in connivance with one another, are also prohibited from engaging in anti-competition practice.

HB 10575 identifies the roles of the Department of Transportation, MARINA, Department of Trade and Industry (DTI), Philippine Ports Authority and other port authorities, Bureau of Customs, and PCC in implementing the proposed law.

It provides for additional members to the MARINA Board and expands the Board’s powers to carry the objectives of the proposed law.

Additionally, the MARINA Board is mandated to formulate a National Logistics Efficiency Policy to serve as a guide in the formulation and issuance of rules, regulations, and programs of implementing agencies.

MARINA is likewise mandated to prescribe fines and penalties for violations ofthe proposed law and its guidelines.

MARINA and DTI, in coordination with the private sector, must also develop a program to educate all Philippine shippers and consignees on international commercial terms used in negotiation, freight and charges, current best practices, and any new developments. – Roumina Pablo

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