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BRENDA V. PIMENTEL: Regulatory capture

Regulatory capture
BRENDA V. PIMENTEL January 13, 2018

THE new year saw another official of the Duterte administration sacked for excessive overseas trips, despite that official’s claims that attending various international meetings was necessary. Engr. Marcial Quirico Amaro 3rd was axed as chief of the Maritime Industry Authority (Marina), apparently based of the complaint filed by the agency’s employees against its “absentee administrator.”

While many maritime stakeholders and observers are discussing whether Amaro’s trips were indeed justified, as these were sanctioned by the Department of Transportation and Malacañang, not much attention was paid to his claim that his ouster was the design of some maritime players to get even with him.

Amaro said he earned the ire of maritime education institutions for suspending their operation permits. He also does not discount that his dismissal may be the work of shipping companies whose vessels were prevented from sailing due to alleged non-compliance with maritime safety standards and regulations.

Amaro may not be aware, but he is making a very strong statement: maritime industry governance is suffering from regulatory capture. This means the agency tasked to ensure that industry players comply with the requirements by which their operations are allowed is indeed at the mercy of those it is supposed to regulate.

Otherwise, they can make things difficult for the the one in the post, including that of being removed from office.

It is good that President Rodrigo Duterte has been very vocal of his dislike of government officials going on too many trips abroad, which lends credence to the reason he fired Amaro. However, it brings to the fore the matter of government officials submitting to the dictates of industry players to suit their interests, at times forgetting the purposes for which their existence is countenanced by the state.

In the case of Amaro, he was saying that Marina’s implementing maritime safety regulations was against the interest of those who had him removed from office.

Presidential Spokesman Harry Roque had openly solicited on radio nominations for the post of Marina administrator. Choosing a candidate for it, I surmise, is not free from lobbyists and interest groups that would wish to put their own man in the agency. And we will watch with interest the expected jockeying for that post.

Of course, it is always better to get one from the industry, as he would understand its demands. But that’s not enough. It is important that the new administrator understands that Marina’s mandate is of public interest. He must not forget that regulating maritime transport is anchored on the Public Service Act, which sees to it that allowing a franchise to operate public utilities is grounded on the provision of safe, efficient and convenient service to the public.

In the case of maritime transport, that means passengers are safely brought to their destination according to the agreed schedule. The same apply to shippers’ cargoes and goods. He must have not only the interest of the sector that helped him rise to the position, but also the whole maritime industry.

An administrator must be one who, in addressing issues facing the industry, is indifferent as to who gets hurt along the way, including his patron. He must always place a corresponding value to the benefits that accrue to the general public. His achievements must reflect concrete outputs of how Marina has responded to the needs of those it is supposed to serve. He must always be mindful that he works in the shadow of the sector he belonged to prior to his appointment, and thus must dispel the skepticism and disprove the allegations thrown at him by stakeholders representing other maritime sectors.

There are many who are suited for the position, but it remains important that the one assuming the post must fully understand the stakes. He will gain friends, but probably gain more enemies; he will be praised for a job well done, but he will also be pilloried for it. Indeed, being appointed as Marina administrator is a “damn if you do, damn if you don’t” situation.

Finally, it may help the administrator to declare his readiness to resign his post the next day after his appointment, thus frustrate all who would try to force him into keeping his post.