House OKs PHL maritime trade bill on 2nd reading

House OKs PHL maritime trade bill on 2nd reading
Jovee Marie de la Cruz January 25, 2022 https://businessmirror.com.ph/2022/01/25/house-oks-phl-maritime-trade-bi...

To promote competition among transport and logistics providers and to improve service quality and reduce shipping cost, the House of Representatives approved on second reading on Monday the bill enhancing the competitiveness of Philippine maritime trade by strengthening the oversight functions of relevant government agencies over the imposition of shipping charges.

Though viva voce voting, lawmakers approved House Bill 10575 to empower government institutions in their roles of promoting an efficient, competitive, and reliable logistics services.

The bill is expected to be approved on third and final reading next week.

Export industry stakeholders are pushing for the implementation of standardized shipping fees, which have increased amid vessel shortage due to container imbalance.

Shipping costs for shipments sent to the Philippines are way more expensive compared to its neighbors in the region, they said. The average cost for local ports amounts to $592 per 20-feet (ft) full container load, as against the $202 average in other countries.

In a joint position paper a copy of which was sent to the BusinessMirror, several industry representatives stressed that shipping charges based on International Commercial Terminology (Incoterms)—a globally accepted standard for international trade—will allow businesses to have better cost management.

Moreover, the bill requires port or terminal operators, international carriers, non-vessel operating common carriers (NVOCCs) and forwarders to file their regular shipping charges and fees with the Maritime Industry Authority (MARINA) and publish the same in newspapers of general circulation.

It also mandates that no new or initial rate or change in an existing rate that results in an increased cost to the shipper may become effective earlier than 30 days after filing with the MARINA, except when allowed by the MARINA for a reasonable cause.

The bill prohibits the international shipping lines or their agents, freight forwarders and NVOCCs to Philippine consignees and shippers to impose local shipping charges, except for internationally-accepted surcharges, fees for value-added services, and behavioral charges such as late payment fee, container insurance, the parameters of which must be clearly defined in the contract of carriage and subscribed by the shipper or consignee.

The measure also requires that certified copies of all existing agreements made between and among international carriers operating in Philippine ports that affect maritime trade shall be submitted to the MARINA within 90 days from the effectivity of this proposal and authorizes the MARINA, during the effectivity of any agreement or amendment thereto, to determine whether the same is likely to produce unreasonable reduction in transportation services or an unreasonable increase in transportation cost, and to refer the same to the Philippine Competition Commission for appropriate action.

The bill prohibits detention charges and demurrage fees when the cause of delay in the return of empty containers is on the part of the shipping lines.

The measure identifies the respective roles of the Department of Transportation (DOTr), MARINA, Department of Trade and Industry (DTI), Philippine Ports Authority (PPA) and other Port Authorities, Bureau of Customs (BOC), and Philippine. Competition Commission (PCC) in the implementation of this proposal.

It provides for additional members of the MARINA Board and expands its powers to carry out the objectives of this proposal and mandates the MARINA Board to formulate a National Logistics Efficiency Policy (NLEP) which shall serve as guide in the formulation and issuance of rules, regulations, and programs of the implementing agencies specified in the proposal, which include as main component, the use of information technology to facilitate efficient business transaction consistent with Republic Act No. 11032 or the Ease of Doing Business and Efficient Government Service Delivery Act.

The bill also prohibits any international carriers or its agent or port or terminal operator to operate under an agreement that has been suspended by virtue of an order of a proper authority, or a temporary restraining order or rendered ineffective by injunction issued by the court.

It prohibits any international carrier or its agent, port or terminal operator, NVOCC, forwarder, or logistic services provider, either alone or in connivance with another to, directly or indirectly, charge, demand, collect, or receive greater, less or different compensation for the transportation of property or for any service in connection therewith than the rates and charges provided in the service contract or those published and filed with the MARINA.

The measure prohibits any international carrier or its agent, port or terminal operator, NVOCC, forwarder, or logistic services provider, either alone or in connivance with another, directly or indirectly to engage in any anti-competition practice within the scope of the Republic Act No. 10667 or the Philippine Competition Act.

It, meanwhile, mandates the MARINA to prescribe the fines and penalties for the violation of the provisions of this proposal or its guidelines.