PPA to foes: ‘Bring it on’

Santiago said on Monday he is more than ready to face detractors in Congress to explain PPA’s side

Photograph courtesy of PPA

See you in Congress. Philippine Ports Authority general manager Jay Santiago, thus, responded yesterday to critics of the Trusted Operator Program-Container Registry and Monitoring System or TOP-CRMS.

Santiago stressed he is more than ready to face detractors of the proposal in Congress to explain the PPA’s side and set the record straight on how the scheme would benefit the logistics industry.

Groups opposed to the digitalization push claimed that it will result in P35 billion in expenses that will be added on to imported commodities, thereby contributing to higher inflation.

Foreign shipping lines are the main critics of the digital shift since they stand to lose billions of pesos in charges not captured by the tax net, the PPA official said.

“Yes, we are open to any congressional investigation on all foreign shipping practices in the Philippines and not only concerning TOP-CRMS,” Santiago said in a Viber interview on Monday.

Last Friday, a group representing international shipping companies prodded legislators to look into Administrative Order 04-2021, which mandated the formulation of the TOP-CRMS, saying that its issuance was anomalous. Members of the group then urged the PPA to revoke the AO.

“We think it is about time that we talk about all of these unwarranted shipping charges which make logistics costs in the Philippines very high with the end in view of providing for a regulated environment where there is a level playing field for all sectors in the logistics chain,” the PPA chief said.

Deluge of disinformation

In a separate radio interview on Monday, Santiago lambasted some groups that, he said, have been spreading false information about the TOP-CRMS that would mean an additional burden to the local logistics sector.

“International shipping lines are making noise and had exerted a strong pushback to TOP-CRMS because they stand to lose huge revenues when the system is implemented. They do not want the government or the industry to generate savings because that would mean reduced revenues to them,” he said.

Data obtained by Daily Tribune covering 2022 showed the country received a total of 1,145,355 containers that were charged with deposits of P20,000 each, aside from the fees on the use of the container yard costing P6,400 for each container.

Shipping lines have allegedly earned a windfall of P22.9 billion for container deposits alone, while for the container yard staging area costs, they have reportedly pocketed P7.3 billion or a total of P30.24 billion in charges representing the extra costs for traders for 2022 alone.

Aside from container deposits and staging area costs, several stakeholders, namely brokers, truckers, and importers, have been complaining about other costs such as the pre-advice fee of P1,500, documentation at P1,200, per lift-on cost of P1,100, per lift-off cost of P1,100, and three-day storage cost of P1,500.

With TOP-CRMS in place, traders will just be charged container insurance and monitoring fee totaling P980 and container staging area costs at P3,520, proponents of the system have said.

In sum, the cost paid by stakeholders will be reduced to P1.122 billion a year in container deposits, and P4.03 billion for the container yard staging area, or P5.15 billion, or savings for traders of some P25 billion, they added.

Santiago admitted that the TOP-CRMS remains pending, but he reiterated that the PPA is committed to the full implementation of the digitalization initiative as it will rationalize port operations, prevent smuggling, bring down logistics costs, and bring relief to logistics’ end users.

Currently, PPA is still waiting for the result of the regulatory impact assessment of the Anti-Red Tape Authority.

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