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Marina requires import authorization for ships

Marina requires import authorization for ships
Genivi Factao November 8, 2023

THE Maritime Industry Authority (Marina) has implemented significant revisions to passenger ship importation regulations, mandating that importers obtain Authority to Import or approval for bareboat charters.

Marina Administrator Hernani Fabia has issued Memorandum Circular (MC) DS-2023-01, or the revised rules on the importation of passenger ships, in line with the Amendment to the Public Service Act. This MC aims to ensure the continued viability of domestic shipping operations and to further enhance the sustainability, competitiveness, and safe operation of passenger shipping services in the domestic trade.

This applies to passenger ships, regardless of whether they are being acquired through direct purchase, lease, or charter.

The application for the issuance of authority to import involves specific requirements and processing fees, which should be adhered to carefully.

The regulations apply to all domestic shipping companies, operators, charterers, ship agents, public and private corporations, partnerships, associations, and other maritime entities that are involved in importing passenger ships intended for domestic use.

The revised regulations also address ship eligibility. Passenger ships built for smooth water operations will not be granted the authority to import.

"Conversion of any type of ship into passenger ships is not allowed at all times, regardless of its acquisition through importation, local purchase, or local construction," according to the MC.

Passenger ships with 500 gross tonnage (GT) and below are not allowed to be imported. Fastcrafts of less than 500 GT may be imported under this circular until a new policy is introduced.

Ship importers need to consider both the ship's age and its classification before bringing it into the country. Passenger ships of 8000 GT and above that are more than 20 years of age may be imported, provided they are classed by a member of the International Association of Classification Societies (IACS) at the time of importation and throughout their operation in the domestic trade.

Failure to maintain the classification by any member of the IACS will cause the revocation of the registration documents, safety certificates, licenses, and Certificate of Public Convenience (CPC).

Passenger ships to be imported should be in an acceptable condition, without outstanding recommendations, as shown in the latest survey report prepared by a marine surveyor authorized by the administration or by the government of the country of its origin. This fact has to be verified or confirmed by an actual survey by the administration to be conducted after the release of the ship from the custody of the Bureau of Customs.

Second-hand passenger ships will be subjected to ultrasonic thickness gauging by the surveyors of the administration or by an accredited private marine surveyor or recognized organization prior to registration in the Philippines.

For ship importers who opt for charter agreements, these regulations stipulate that the charter contract should be valid for at least one year. Any amendments to the charter party require prior approval from the administration.

The operation of the passenger ship should be entirely in the hands of the Philippine bareboat charterer. The foreign owner should only be involved as necessary to protect their rights.

The ship importer's adherence to these regulations may lead to fiscal benefits. The ship importer can avail of the incentives under EO 226, the Investment Priority Plans of the Board of Investments, the provisions of RA 9337 and its implementing rules and regulations (IRR), and other incentives the administration grants.

The documentation requirements for ship importation are comprehensive, covering various aspects, including letters of application, affidavits, ship documents, and more. Ship importers need to ensure that they have all the necessary documents in order before starting the importation process.

The fees for obtaining the authority to import are outlined in the MC. The regulations establish sanctions and penalties for noncompliance. Violations of the provisions within the circular can result in administrative fines and penalties, depending on the nature and severity of the violation. These penalties can range from P500,000 to P1 million, to disqualification from ship importation and even legal consequences.