Press Release
February 23, 2015

Senate acts to allow foreign ships to dock in multiple ports

The Senate today passed on third and final reading a bill that would allow foreign ships to dock in multiple ports, provided that their cargoes are intended for import or export and duly cleared by the Commissioner of Customs.

Senate Bill No. 2486, sponsored by Sen. Paolo Benigno "Bam" Aquino IV, amends Section 1009 of the Presidential Decree No. 1464, otherwise known as the Tariff and Customs Code of 1978, which aims to introduce much needed reforms in the shipping industry.

Senate President Franklin M. Drilon said the measure is part of efforts to sustain the country's economic growth and prepare for the ASEAN economic integration slated to start this year: "Improving our shipping industry and logistical capacity will position the country in the global market and improve the flow of goods and services in the country which will help businesses and ordinary Filipinos alike."

"This is our first step in our effort to further unlock the shipping industry, let it grow and thrive, and make it as efficient as possible as we anticipate more trade, more economic activity, and real inclusive growth for the Filipino people," Aquino said, adding that passing the measure answers the call of President Benigno Aquino III and various stakeholders to enhance the country's maritime transport industry.

Section 1009 of the Tariff and Customs Code of 1978 states that passengers or cargo arriving from abroad via a foreign vessel may only be carried by the same vessel through any port of entry to the port of destination in the Philippines. It also states that cargo intended for export may be carried in a foreign vessel through a Philippine port.

Senate Bill No. 2486 provides Filipino producers and entrepreneurs the chance to lower their production costs by allowing importers and exporters to co-load in foreign ships going in or out of the Philippine jurisdiction. This, according to the bill, allows for the decongestion of the Port of Manila, thereby allowing for easier business transactions in the maritime transport industry.

As an example, Aquino said that an exporter from Cagayan de Oro (CDO) currently needs to pay twice to ship goods to Hong Kong (US$1,120 to ship his goods to Manila via a local shipping line, and US$144 for the trip from Manila to Hong Kong) while the cost of shipping a 20-foot container unit from Kaoshiung, Taiwan, to Cagayan de Oro only costs US$360.

Aquino also noted that the same importer from Cagayan de Oro will also pay twice to ship his cargo: US$159 for the trip from Kaoshiung, Taiwan, to Manila using a foreign vessel, and US$1,120 for the trip from Manila to CDO.

"Approval of this measure not only saves much needed cash; those who are into the import-export business will also be able to access a cheaper alternative in transporting their goods through co-loading in foreign ships. Ultimately, this leads to lower prices of goods for the Filipino public," Aquino said.

Under the measure, a foreign cargo will be allowed to go directly to Manila, then proceed to CDO instead of the existing procedure where goods are unloaded in Manila, then transshipped to local carriers which will carry these to CDO.

"Entrepreneurs who are exporting goods from Subic, Cebu, CDO and Davao, would be able to co-load in one ship before heading out of the country directly in a more efficient and cost-effective manner instead of having to pass by the Manila ports," Aquino said.

Allowing foreign ships to go directly to other domestic ports around the country will free up space in the container yards in the Port of Manila, saving time, costs and energy for exporters and importers in sending their raw materials, goods and products in and out of the country, he added. (Yvonne Almirañez, PRIB)

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