Bleeding Ports

By Chito Junia

PORTS are crucial for the country's integration into the global economy. It is in fact, the gateway for industrial growth that provides the nation's vital trade link with the world market and connection between the sea and land transport.

In the Philippines, the bulk of imported agricultural, food and finished products that go to the local markets, and the amount of imported raw materials that feed the factories of the country's manufacturing industry pass through the Port of Manila (POM) and the Manila International Container Port (MICP), the country's two major ports.

Operated by private port operators after the government turned over the operation and control of POM and MICP to Asian Terminals, Inc. (ATI) and International Container Terminal Services, Inc. (ICTSI) respectively, port users deplore the unfriendly policies of private port operators and the government's insensitivity for its port woes.  

 

International Shipping Lines Go Beyond Government Reach

In 2014, POM and MICP experienced their worst congestion ever. Triggered by the City of Manila's implementation of its expanded truck ban, container movements at the two ports went on a stand still as truck movements were limited to only a few hours each day, causing a build-up of container vans at the ports. 

At the height of port congestion, shipping companies charged as much as P 60,000.00 per 40-footer container van for various congestion -related fees without consulting the port users, and allegedly without government approval.  

And while port users asked government help to look into the exorbitant fees being charged by international shipping companies, PPA officials could only say, regulating and/or monitoring the operations of international shipping lines in the country is not part of PPA's mandate.  

Not even then Cabinet Cluster Head Secretary Rene Almendras could give a definite answer to the port users’ woes. In a forum organized by the Port Users Confederation (PUC) at Diamond Hotel in 2015, Almendras said, the government cannot regulate the fees being charged by international shipping lines since these are foreign-based companies, even as he added that, the government cannot also impose sanctions on these shipping companies as they might no longer make port calls in the country.

During the first quarter of 2015, the government declared the congestion problem at the ports resolved. However, port users lament at how some shipping lines still continue to charge congestion related fees today, making them wonder if President Rodrigo Duterte is even aware of this situation at the ports. 

“They just changed the account title from congestion fee to other fees like terminal handling fee among others”, a customs brokers who requested not to be named said.

Port users are dismayed at the current PPA leadership's continued helplessness with international shipping lines, even if Duterte's declaration to separate from the United States of America  in terms of economic and military aspects, manifests the president's determination not to allow the country to be dictated by foreign influence.

 

Hoarding of container deposits by shipping lines

As a trade practice at the ports, importers/brokers are required to make a deposit for every container van for their importations. The amount could range from P 6,000.00 to P 10.000.00 per container van, depending on the shipping company. 

Importers/brokers are however, given a five-day window to return the empty containers without charges, upon which the container deposit shall be refunded to the broker/importer. 

Otherwise, if the container is returned beyond the five-day window, the shipping line will impose penalty fees per day of delay in the return of the empty container van which shall be deducted from the container deposit.

But if shipping companies are upfront in the collection of container deposits, many of them are, however, slow to very slow in the refund.  According to the brokers some shipping lines would only refund container deposits after six months or even more, even if the empty container van had been returned within the five-day window.

And since international shipping lines are beyond government reach, many customs brokers' claim for refund fall on deaf ears, giving them no choice but to contend with the abusive and exploitative acts of some shipping companies. After all, these are pass- on costs to importers, which eventually would be passed on to consumers. 

The situation at the port practically makes customs brokers and importers hostage to the whims and caprices of international shipping companies. With a government that is virtually helpless in regulating the operations of international shipping lines, things might only turn from bad to worse at the ports.

 

The TABS

Among the measures implemented by the Aquino government to avoid a repeat of the 2014 port congestion problem was the Terminal Appointment Booking System (TABS).  

Under TABS, ATI and ICTSI, in collaboration with Australia's 1-Stop Connections Pty Ltd. established an organized in-and out-flow of containerized cargoes from both terminals, where only trucks with confirmed appointments are allowed to enter its port premises.

Henceforth, all trucks entering the two ports are required to book for an appointment through TABS. A Demand Zone Matrix was established for the corresponding fees to be paid to avail of the appointment booking platform. 

Sunday to Monday morning is a zero demand zone and free of charge. Monday evening to Tuesday is a medium demand zone with a booking fee of P 300.00. And Wednesday to Saturday is high demand zone with a booking fee of P 1,000.00.

For truckers who are not able to meet their appointment on time, a penalty matrix was also established. Truckers who arrive over two hours late for their appointment slot are penalized P 1,625.00. While truckers who fail to show for their appointment are charged a no-show penalty of P 3,251.00.

Port users, however, lament the penalty clause claiming this is a one-sided provision. According to the customs broker, while they are penalized if their trucks arrive late for its appointment slot, ATI and ICTSI are not penalized in case there is delay in providing service to their trucks even if they arrive on time for its appointment. .

“This is a one-sided policy where port users are even made to pay for the inefficiencies of port operators,” said the broker.  

In a dialogue between customs brokers and officials of ATI and ICTSI at the BOC Social Hall, a port operator official said the loading and unloading of berthed ships have higher priority over the loading of trucks with container vans. Thus, a delay in the servicing of trucks during their appointed time can happen if there are on-going loading and unloading activities on ships berthed at its piers, among other reasons.   

“Private port operators should also be liable for their inefficiencies or for their lack of equipment to provide timely service to its customer, especially those who have booked for an appointment and paid the corresponding booking fees,” the broker said.

Who gets the bulk of the fees raised through TABS?

The volume of containerized vans that move in and out of POM and MICP can reach up to 3,500 each day, depending on the season of the year. 

Thus, ICTSI and ATI could earn easily millions of pesos each day from the booking and penalty fees on TABS alone. 

There are allegations that only 20% of the total collections from TABS go to the government for its share through the Philippine Ports Authority (PPA), prompting some port users to ask for an explanation on how and where these monies go after collection by the port operators..

The integration of the 10 Asean economies into a single market has opened more opportunities for the country. 

But its bleeding ports could affect its competitiveness in a market driven global economy.

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Tuesday, 21 November 2017
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