Philippine Ports Authority tightens rules to curb storage abuse

The Philippine Ports Authority (PPA) is formulating new policies to ensure that ports remain efficient for cargo movement and to prevent importers from using them as storage facilities.

Addressing concerns about delays, the country’s port authority is working to streamline procedures that discourage importers from keeping goods at ports for long periods.

“We are coordinating with the Bureau of Customs (BOC) to ensure that importers do not delay filing their importation entries. We are gradually reviewing our processes within the PPA and the BOC,” said PPA General Manager Jay Daniel Santiago.

He emphasized that Philippine ports are meant for cargo movement, not for storage. “Philippine ports under the supervision of the PPA are designed not as storage areas for importers and other users as these are mainly meant to move cargo.”

Santiago pointed out that some importers waited up to a month before filing their import entries, even though the cargo has already been unloaded. Filing the import entry triggers the processing at the Bureau of Customs, but some importers intentionally delay the process to save on storage costs.

“Some importers delay the filing of the import entry since they can save on storage costs at the ports compared to private warehouses. They pay only P700 (US$12.25) a day (per container). For a month, that is P21,000 (US$367.38), which is a small amount compared to the value of the shipment,” Santiago explained.

Under current regulations, importers have 30 days to remove their cargo after the BOC clears it. After this period, the cargo is considered abandoned and condemned.

To address this issue, the PPA handed over a list of 20 consignees to the country’s Department of Agriculture (DA). These consignees failed to withdraw over 500 containers of rice and other agricultural products from Manila ports by the end of September.

In an October 1 letter, the PPA gave Agriculture Secretary Francisco Tiu Laurel a detailed inventory of these unclaimed shipments, which included pork, chicken, and onions.

Santiago clarified that the PPA does not have the authority to penalize these consignees, as its focus is strictly on port management. However, the PPA has instructed the head of operations at Asian Terminal, the operator of Manila South Harbor, to report these overstaying containers to the BOC for proper action, in line with Section 1129 of the Customs Modernization and Tariff Act on abandoned containers.

“We believe having this information regularly will help both PPA and DA identify trends, address challenges promptly, and improve overall service delivery,” Santiago added.

Preparing for holiday season

As the Christmas season approaches, the PPA has intensified its monitoring of key agricultural products like pork, chicken, and onions. The agency provided the DA with an inventory of these shipments at Manila ports as of September 30, which includes 135 containers of pork, 101 containers of chicken, and 24 containers of onions.

Despite being cleared by the BOC, 21 containers of pork have been sitting at the port for over 30 days, with five containers remaining for more than 1,000 days.

Moreover, 22 containers of chicken are still at the port, with 12 of them exceeding 600 days in dwell time. Four containers of onions have not yet received clearance from the On-Line Release System, which generates electronic release instructions for import shipments.

Improving efficiency and preventing congestion

In a September interview with Maritime Fairtrade, Santiago explained that there is no congestion at major ports like Manila and Batangas. He assured that the country’s main gateway ports are operating efficiently and well within capacity.

“As of September 2024, PPA records show that yard utilization at its ports is currently at 70 percent, indicating that the ports are not experiencing any congestion,” Santiago told Maritime Fairtrade.

He noted that the average dwell time for containers at PPA-managed ports is 5.4 days, the lowest in the agency’s history and just 0.4 days beyond the five-day free storage period.

This means that most cargo is processed and released within the free storage period. However, Santiago acknowledged that rice container shipments have been delayed by some consignees.

“While other cargoes are generally released within the allotted free storage period, some rice container shipments from some consignees remain at the ports for over 20 days despite having been cleared for release by the Bureau of Customs. This situation has contributed to perceived delays in rice shipments and possible artificial increases in rice prices,” Santiago explained. 

According to Santiago, to address potential congestion and enhance efficiency, the PPA is implementing several key strategies:

  • Port capacity expansion: The PPA is expanding port infrastructure, including container yards, to accommodate growing trade volumes and larger vessels. At the Port of Batangas, the PPA is developing new berth and yard facilities to manage bulk and breakbulk cargo more efficiently.
  • Terminal Appointment Booking System (TABS): In Manila ports, the PPA introduced TABS, a web-based system that allows stakeholders to schedule container deliveries and withdrawals. This system optimizes terminal resources, reduces wait times, and streamlines operations to prevent congestion.
  • Decentralization of cargo traffic: The PPA is developing regional ports outside Metro Manila to serve as alternative hubs for shipments. This initiative reduces the concentration of cargo at Manila ports, distributing the load more evenly across the country.
  • Increased storage charges: The PPA raised storage charges for foreign containerized cargo exceeding the free storage period to discourage long-term storage. This encourages faster removal of containers and helps alleviate potential congestion.

“These measures, including the development of specialized facilities for bulk and breakbulk cargo at the Port of Batangas, aim to enhance overall port efficiency and meet the increasing demands of trade,” Santiago said.

Through these initiatives, the PPA is committed to keeping the country’s ports efficient and preventing congestion, particularly during the peak holiday season. The port authority hopes to maintain smooth operations while addressing long-standing issues related to port usage and importation delays.

Photo credit: PPA. PPA’s general manager Jay Santiago at the Manila International Container Terminal.

The best maritime news and insights delivered to you.

subscribe maritime fairtrade

Here's what you can expect from us:

  • Event offers and discounts
  • News & key insights of the maritime industry
  • Expert analysis and opinions on corruption and more