Transportation Secretary Jaime Bautista —INQUIRER PHOTO
MANILA, Philippines— The proposed policy of the Philippine Ports Authority (PPA) to impose new shipping fees has been deferred by the Department of Transportation (DOTr) following the objection of stakeholders and fears that these would only lead to higher costs of goods, Transportation Secretary Jaime Bautista told the Senate on Wednesday.
In his online appearance before the hearing of the Senate public services committee, Bautista disclosed that the PPA board decided to put on hold the implementation of the Trusted Operator Program-Container Registry and Monitoring System (TOP-CRMS), which the PPA said was the solution to address the long-standing issue on the return of container deposits imposed by foreign shipping lines and to manage the backlog of foreign empty containers.
Various stakeholders and business groups, however, opposed the program and called on President Marcos to intervene and immediately scrap TOP-CRMS, which they said “threatens to cripple the transport and logistics industries and the national economy as a whole.”
“[The project] was presented to the PPA board, and as of now, the decision is to defer it for the meantime that we are attending to the opposition; we will do another round of review for this,” he told the panel chaired by Sen. Grace Poe.
Added costs
Poe’s committee tackled Senate Resolution No. 484, filed by Sen. Risa Hontiveros, on a number of PPA issuances, mainly the establishment of the TOP-CRMS, which is a mechanism for registration and monitoring of containers entering and exiting ports.
The groups opposing the project estimated that the direct financial cost alone from the additional insurance fees, transaction fees and trucking fees required by TOP-CRMS would raise by almost 50 percent the cost of importing goods. In monetary terms, they said this would add at least P35 billion to annual import costs.
Under the proposed implementing operational guidelines of the project, forwarders, customs brokers, importers and consignees should secure container insurance that costs P980 plus value-added tax (VAT) per container through TOP-CRMS, as a requirement for releasing the container.
All empty containers for reexport would also be required to be endorsed to a PPA-designated staging facility at least 72 hours prior to departure. This would entail a service fee of P3,520 plus VAT per container beyond the first three days, the groups said.
They added that the system would not be a solution to port congestion as claimed by the PPA, and would actually be a “clear usurpation of Customs function.”
Business groups such as the Philippine Exporters Confederation and the Philippine Chamber of Commerce and Industry earlier signed a statement calling for the revocation of the TOP-CRMS and Empty Container Storage Shared Service Facility.
They argued that the PPA has acted outside its jurisdiction and would duplicate the functions of the Bureau of Customs (BOC) in terms of provisioning real-time monitoring of the container’s movement.
The groups added that it would create inefficiencies and dramatically raise costs for consumers and businesses, primarily the micro, small and medium enterprises, and derail the country’s recovery from the pandemic.
Broad opposition
According to Bautista, other agencies of the government have also raised doubts over the necessity of the TOP-CRMS.
“The [BOC] has said it is not that important because they are already doing the same (function), while the [Department of Trade and Industry] and the [National Economic and Development Authority] are not in full support because they still would like to fully understand the need for it,” he noted.
Bautista said the PPA board already came up with the decision to defer it as early as January, but that the PPA management was purportedly bent on having it launched.
“Only a few weeks ago, we had an interagency meeting and we received the opposition from about 20 groups; even the (European Union) ambassadors that we talked to were telling us not to implement it,” he added.
As the launch of the TOP-CRMS remains on hold, the PPA would continue to implement other programs aimed at solving the problem of congestion at the country’s ports, Bautista said.
The Senate panel is also looking into the administrative circulars that cover the grant of port terminal management contracts, the establishment of a central ticketing system in the ports, and increases in garbage collection fees.
Hontiveros called for an inquiry into the controversies surrounding PPA issuances in the wake of opposition from major shipping and logistic groups, which feared that the project would increase logistics cost and eventually the prices of food and basic commodities.
During the hearing, she expressed concern that the winning bidder for the P877.6-million contract to run TOP-CRMS, the joint venture of NextIX Inc. and Shiptek Solutions Corp., might be suffering from a conflict of interest as its owners supposedly have a stake in the shipping and trucking business.