The Philippine Ports Authority (PPA) is standing its ground on the digitalization of its operations, particularly on the management of container cans entering and exiting its ports across the country, amid resistance from some business groups.
PPA General Manager Jay Santiago said that the claims of business groups that the digitalization would bloat the cost of operations for customers, carriers, freight forwarders, and shippers, are unfounded.
"The resistance, supposedly based on the fear that the program would inflate the cost of logistics is far from the actual benefits it can bring to the table," said Santiago.
Santiago explained that currently, shipping lines have been charging truckers, custom brokers, and forwarders P10,000 up to P30,000 for dry containers and up to P180,000 for refrigerated containers.
But with the new system through the Trusted Operator Program- Container Registry and Monitoring System (TOP-CRMS), he said the amounts would be reduced to a minimal fee of P980 per container for monitoring fee inclusive of container deposit insurance to also address the issues of missing and damaged containers and P3,408 empty container handling service fee (for its first three days at PPA-designated empty container yards).
"This will be in lieu of the more costly container deposit fees amounting up to P30,000 or even P180,000 for refrigerated containers," said Santiago.
TOP-CRMS uses technology for up-to-date container tracking allowing customers, carriers, freight forwarders, and shippers to access the status of their cargoes and containers.
It is expected to keep a registry and monitor all inbound shipping containers that will track every foreign-owned container’s location and movement using the industry- accepted data interchange formats through encrypted channels.
In implementing the TOP-CRMS, Santiago said the objective of PPA is to provide additional support by solidifying clear jurisdiction and cooperation with equally mandated government agencies,
"While the PPA does not claim the TOP-CRMS will solve all the problems in smuggling, the data generated from the system might help the other government agencies in their drive to curb this long-standing problem that has resulted in billions of lost revenues to the government, not to mention the unfair practices committed against domestic producers," said Santiago.
"It will also help alleviate storage problems at ports and prevent port congestion through the provision of shared facilities for empty containers as it aims to address the congestion not only inside terminals but also along access roads going in and out of the ports particularly during holiday seasons," he added.
Santiago said the implementation of the TOP-CRMS is in line with the directive of President Ferdinand "Bongbong" Marcos Jr. to digitalize government processes and make them more effective and transparent for the end-users.
"This will streamline all the transactions at the ports in support of the Ease of Doing Business Law. In fact, in a meeting with the Private Sector Advisory Council at Malacañan Palace, the President has given the green light to proceed with the TOP-CRMS of PPA to help lower commodity prices, prevent smuggling, and improve revenue collections," said Santiago.
No encroachment of function
Santiago said the Bureau of Customs (BOC) is also backing its implementation which was expressed during a consultation meeting with stakeholders on Jan. 4.
Santiago made the statement after some business groups said monitoring of the container vans is not within the mandate of the PPA, but of the BOC and that the TOP-CRMS would actually encroach on the function of the BOC.
But Santiago said that under the Presidential Decree No. 857, it is PPA’s mandate to manage and monitor the entry, exit, re-entry and re-export of containers at PPA-administered ports.
The PPA, he said, is in constant communication and coordination with the Bureau of Customs (BOC) and does not encroach on the function of the latter.
Santiago explained that BOC’s Electronic Tracking of Containerized Cargo (E-TRACC) monitoring system is limited only to containerized cargoes using GPS enabled electronic locks bound to limited destinations; Custom Facilities and Warehouses (CFW) and PEZA zones, while PPA’s mandate is to manage cargo traffic in its terminals and avoid port congestion.
Santiago stressed that the mandate and interests of BOC are specific to cargo and identification of implements used to transport cargo from ports of origin, shipments, and port of destination.
"While BOC and PPA have their own respective mandates, sharing of data in order to provide a whole-of-government approach to solving national problems such as smuggling should not be frowned upon but, on the contrary, encouraged. Streamlining does not mean any government agency will forego its mandate and subsume authority under another agency," said Santiago.
"Although TOP-CRMS is not primarily intended as an anti-smuggling system, the TOP-CRMS can thwart cargo diversion which is a common tool for smuggling schemes. With this real-time tracking, law enforcers can now eliminate the fake consignees and prevent additional charges. After all, addressing smuggling should be an orchestrated effort," he added.
The main objectives
Eliminate container deposits and manage empty containers— these are the two primary purposes of the TOP-CRMS, according to the PPA.
Santiago disclosed that there are huge hidden charges imposed by some shipping lines that are not transparent to the public.
He said this was disclosed during the first public consultation on Jan. 4.
He said it is the hidden charges that result in layers of costs and contribute to the bloated trading costs down to the end users and eventually contributing to the higher prices of commodities.
"Not only did the public consultation expose the ambiguity of shipping line charges but it also pointed out that there is really a dire need for a uniform and systematic container monitoring system," said Santiago.
Aside from container deposits, he said the TOP-CRMS under its proposed shared staging facility for empty containers will likewise address concerns on detention charges, container imbalance charges, peak season charges, and the like.
"While some business groups are opposing the TOP-CRMS which will help promote transparency and lessen business costs, PPA would like to take a stand for the underprivileged and under represented segment of the logistics sector, namely, the truckers, brokers, and stakeholders that will benefit from this whole-of-government approach of digitalization through the TOP-CRMS," Santiago stressed.