A group of Filipino customs brokers disputed the claim of the Philippine Ports Authority (PPA) that its multi-million-peso container monitoring and registry program could bring down the logistics and shipment costs being paid by stakeholders.
PPA General Manager Jay Daniel Santiago previously said that through the implementation of the P980-million Trusted Operator Program-Container Registry Monitoring System (TOP-CRMS), importers can save as much as 95 percent in container deposits. He also estimated that importers paid around P33 billion container deposits to shipping lines in 2022.
“That’s not true. On the contrary, the stakeholders stand to pay more due to the TOP-CRMS. As a consequence, these excessive and unnecessary additional costs will be passed onto the consumers,” Julita Q. Lopez, president of Customs Brokers Federation of the Philippines (CBFP), said in a statement on Friday, Feb. 3.
“What the PPA deliberately omitted is the fact that these container deposits they are trying to eliminate are refundable to importers once the container is returned to the depot. Under the TOP-CRMS, it will not be the case anymore. The PPA will charge importers a service fee amounting to P980 per container on top an undisclosed amount of insurance coverage in lieu of a container deposit excluding value-added taxes,” Lopez explained. She added that even the choice of insurance provider will be left to the PPA.
According to Lopez, the TOP-CRMS contract was awarded to Shiptek Solutions owned by a certain Eugenio Ynion, a barangay captain in San Pedro, Laguna.
Under the current system, shipping lines require container deposits and maintenance fees per container from importers. The deposits are refunded to the stakeholders once the empty container is returned to the depot.
The PPA reported that there were approximately 1.1 million containers in 2022. Once TOP-CRMS is implemented, importers and container users will pay P980 per container aside from the insurance coverage for each container.
But Lopez was not convinced that the new system will be beneficial for all stakeholders as she claimed that the PPA was “deliberately misinforming the Marcos administration as well as the Filipino people.” She noted that it will be the public who would bear the consequences of the new system “as the industries will have no choice but to pass onto the consumers the additional expenses that they will incur.”
“Our estimates indicate that the direct financial cost alone from the additional insurance fees, transaction fees, and trucking fees required by the TOP-CRMS/ECSSSF (Empty Container Storage Shared Service Facility) will result in an almost 50 percent increase in the cost of importing goods. In real terms, this will lead to a staggering additional annual import cost estimate of at least P35 billion,” she said.
Last week, 17 business organizations have called on President Ferdinand Marcos Jr. and the Congress to immediately scrap the PPA from implementing the container registry and monitoring system and revoke Administrative Order No. 04-2021.
“The PPA fails to consider that the ultimate victim of these additional costs is the ordinary Filipino consumer, who is already bleeding from an inflation rate of 8.1 percent. The policy will result in astronomical increase in the prices of basic food and other commodities,” Lopez warned.
The PPA has yet to respond to the CBFP’s latest tirade although Santiago insisted earlier this week that the PPA will pursue the implementation of the TOP-CRMS, saying it is one of the digitalization commitments of Marcos to rationalize port operations and prevent smuggling.