PPA container monitoring system could stand improvement—ARTA

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  • The Philippine Ports Authority policy on container registry and monitoring system could stand improvement
  • The Anti-Red Tape Authority earlier rated the regulatory impact statement on the PPA system as “good practice”
  • A good practice rating means the policy has “elements where analysis or the process were not of exceptional quality and could have been improved”
  • The decision to implement the container monitoring system remains at the discretion of heads of agencies, ARTA said

The Philippine Ports Authority (PPA) policy on container registry and monitoring system, while given a “good practice” rating by the Anti-Red Tape Authority (ARTA), could stand some improvement.

ARTA earlier rated as “good practice” the system’s regulatory impact statement (RIS), which under the rating scheme “contains an overall good quality analysis and alignment to good regulatory principles in addressing the eight RIS sections” but “has elements where analysis or the process were not of exceptional quality and could have been improved.”

RIS is the main document for the regulatory impact assessment (RIA) process, a scientific tool that ensures that a proposed or existing regulation will not be causing undue regulatory burden and cost.

The decision to implement the regulation remains squarely at the discretion of the heads of agencies, ARTA director general Ernesto Perez said.

The RIS for PPA Administrative Order (AO) No. 04-2021 garnered a score of 36 out of 40 or a “good practice” rating, Perez said in a statement.

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 to PPA’s Trusted Operator Program-Container Registry and Monitoring System (TOP-CRMS) and to secure a container insurance policy.

Perez’s statement comes a few days after PPA issued a media release welcoming ARTA’s assessment of its RIS, saying it is a “green light” from ARTA that can be taken to mean that TOP-CRMS “is the best option to solve the current problems” on container deposit return and management of empty containers.

PPA in its release had quoted ARTA’s evaluation of the system: “PPA has provided concise and satisfactory evidence on all RIA sections. Hence, the RIS was assessed as Good Practice.”

ARTA said it recommended to PPA the conduct of a full RIA and submission of an RIS on AO 04-2021. This is pursuant to Section 5 of Republic Act 11032, or the Ease of Doing Business and Efficient Government Service Delivery Act of 2018, which mandates that all proposed regulations of covered government offices shall undergo a RIA to ensure that these will not add undue burden and cost to stakeholders and to avoid overlapping of regulations.

The same section states that, when necessary, proposed regulations may undergo pilot implementation to assess regulatory impact subject to the clearance of the heads of agencies.

Under Section 17 of the same law, ARTA has the power to review proposed major regulations of government agencies using submitted RIS subject to proportionality rules, provide recommendations to improve regulatory management and provide technical assistance and advisory opinions in the review of proposed national or local legislation, regulations or procedures.

Perez said ARTA received the initial RIS from PPA last January 30, 2023 and submitted several revisions thereafter. On March 3, ARTA sent to PPA the result of its evaluation of the agency’s RIS, which garnered the “good practice” rating.

ARTA provides ratings on the quality of analysis in the submitted RIS, which are categorized according to the RIS score: best practice (40), good practice (30-39), satisfactory RIS (24 – 29), and insufficient RIS (8-23).

Best Practice RIS is deemed an exemplary model in policymaking. A good practice RIS has “elements where analysis or the process were not of exceptional quality and could have been improved” while a satisfactory RIS indicates “adequate performance but contains a number of shortcomings”. Insufficient RIS requires an overhaul.

ARTA highlighted in its letter to PPA that “as part of Section 8 of the RIS or the Monitoring and Evaluation Plan, the PPA has signified that the IOG [Implementing Operational Guidelines] will be subjected to a pilot implementation and will be amended accordingly to address any issues and concerns that may arise.”

PPA’s proposed IOG for AO 04-2021 has been subjected to a public hearing on January 4 and has since been revised.

Various stakeholders and business groups have been opposing the program since PPA first proposed the idea of a container registry and monitoring system in a public consultation in June 2021.

Seventeen stakeholders and business organizations earlier called on President Ferdinand Marcos, Jr to intervene and immediately scrap AO 04-2021 and TOP-CRMS, which they said “threatens to cripple the transport and logistics industries and the national economy as a whole.”

Under the proposed IOG of AO 04-2021, forwarders, customs brokers, importers, and consignees should secure container insurance in the amount of P980 plus value-added tax (VAT) per container through TOP-CRMS as a requirement for container discharge. Moreover, all empty containers for re-export are required to be endorsed to a PPA-designated staging facility at least 72 hours prior to departure and this entails a service fee of P3,520 plus VAT per container beyond the first three days.

They added the system is not a solution to port congestion as claimed by PPA, and a “clear usurpation of Customs function.”

Two stakeholders’ organizations, on the other hand, said they support the system, noting it will finally end issues on the return of container deposit and empty containers.

Implementation of TOP-CRMS has been indefinitely deferred by majority of PPA’s Board of Directors following calls from various stakeholders and business groups to scrap the system.

“PPA will continue to fine-tune the program and the implementation of PPA AO No. 04-2021 and its IOG will be constantly monitored and the necessary adjustments to the IOG will be done as necessary,” PPA general manager Jay Daniel Santiago said.

The Department of Transportation, PPA’s mother agency, has called for a public consultation on AO 04-2021 on March 14. – Roumina Pablo