Editor’s Note: This is Part 1 of a 3-part PortCalls series on Manila’s port congestion.
INTRODUCTION
Manila is choking on its own cargo.
At the country’s two most critical trade gateways — the Manila international container terminals and the Ninoy Aquino International Airport (NAIA) — a confluence of capacity constraints, structural bottlenecks, surging volumes, and aging government technology has created a crisis reverberating across Philippine supply chains. Some importers are watching duties pile up on uncleared shipments. Some manufacturers are running short on components. At least one global technology company has already suspended production of one of its lines. And with the busy “ber months” fast approaching, industry leaders warn that the worst may be yet to come if urgent, systemic solutions are not put in place.
This is not a single-point failure. It is a system under strain — at sea and in the air simultaneously.
PART 1: THE SEAPORT CRISIS
A Port System Near Its Limits
Manila’s two major international container terminals — the Manila International Container Terminal (MICT) and Manila South Harbor — together handle the lion’s share of the Philippines’ containerized trade. MICT, operated by International Container Terminal Services, Inc., alone processes approximately 70% of the country’s container traffic, recording its highest-ever annual volume of 3 million twenty-foot equivalent units (TEUs) in 2025. Manila South Harbor, operated by Asian Terminals Inc. (ATI), handles the remainder across a terminal rated at 2 million TEUs annually.
For much of early 2026, both terminals operated dangerously close to — and at times beyond — their yard capacity. Reefer yard utilization at MICT breached 100% on multiple days during the first and second weeks of February, while overall yard utilization hovered in the mid-80s. Manila South Harbor reported similarly elevated figures. Empty container depots outside the terminals were also at capacity, creating a cascading problem: trucks could not pull laden containers from the terminals because there was nowhere to put the empties. Conditions improved from March after some Bureau of Customs (BOC) intervention, but utilization began climbing again in late April.
What Caused It — and Who Is Pointing Fingers at Whom
The congestion at Manila’s seaports is rooted in a convergence of factors, some cyclical and some structural — and depending on who is asked, the blame lands in very different places.
The Association of International Shipping Lines (AISL) attributed the early-year spike to “a convergence of seasonal, operational, and logistical factors observed since mid-December,” a period that traditionally sees a surge in import volumes. But while seasonal peaks are predictable, the system’s inability to absorb them points to something more chronic.
Terminal operators and port authorities point to importers and consignees, whom they say are simply too slow to withdraw their cargo. When laden containers sit inside a terminal long after duties and taxes have been paid, they occupy yard space that should be turning over. ATI made this frustration explicit in a May 26 marketing circular, issuing an urgent call for the immediate withdrawal of import boxes — both dry and reefers. The operator warned that if conditions did not improve within seven days, it would invoke a Philippine Ports Authority administrative order authorizing the forced transfer of long-dwelling cleared boxes to designated container depots.
Importers and customs brokers push back. Their argument: they cannot withdraw laden containers because they have no trucks — and trucks are unavailable not by choice, but because they are trapped in a logjam of their own: they are carrying empty containers destined for off-dock depots that are already full and refusing to accept more. So the truck sits, waiting for a depot to open up, while the laden container it could have collected stays at the terminal, adding to the pile. It is a gridlock that implicates every link in the chain.
The empty depot problem is both cause and symptom. Foreign shipping lines have been accused of being slow in repatriating their empties, leaving idle boxes at terminals and depots. AISL maintains that shipping lines are complying with BOC’s 90-day container dwell time policy and that empties are being loaded onto vessels for re-export — but the pace has not been fast enough to prevent depots from filling up.
The result is a blame loop that has paralyzed action for months: terminals blame importers for slow withdrawal; importers blame truckers for unavailability; truckers blame depots for turning away empties; depots say they are simply full; and shipping lines say they are doing their part. Everyone is right about someone else’s problem, and no single actor has the leverage to break the cycle alone.
The e2M Problem: A System Running on Borrowed Time
Compounding the physical bottlenecks is a technological one that has long been an open wound in Philippine trade facilitation: BOC’s Electronic-to-Mobile (e2M) system — the aging customs clearance platform through which all import transactions must pass — is widely considered slow, unstable, and well past its operational prime.
System slowdowns, frequent downtime, and processing backlogs within e2M directly translate to delays in lodging goods declarations, releasing assessments, and clearing cargo — adding hours or even days to what should be routine transactions. When e2M goes down, the entire clearance pipeline stops, regardless of whether cargo is ready for release or documents are in order. In a port environment already strained by high yard utilization, even a few hours of downtime can cascade into a full day’s worth of additional cargo dwell time.
The problem is structural. e2M was never designed to handle current trade volumes, and years of patchwork updates have only deferred its fundamental limitations. BOC has long acknowledged the need for replacement, and work on a successor — the Customs Processing System — is ongoing. But until a new system is fully operational, the industry remains hostage to a platform its trade volumes have long outgrown. For importers and brokers already battling congestion, delayed assessments, and full depots, an unreliable clearance system is not merely an inconvenience — it is a compounding crisis that stretches dwell times and inflates demurrage charges.
The Response: Three Immediate Measures
BOC, recognizing that port congestion falls partly within its operational remit, moved decisively. Commissioner Ariel Nepomuceno, in a memorandum dated June 19 to the district collectors of BOC-Port of Manila and BOC-Manila International Container Port, ordered the immediate adoption of three measures.
The first is the mandatory transfer of overstaying laden containers to accredited off-dock container yards. BOC set 75% yard utilization as the normal operating level, with congestion measures automatically triggered when this threshold is exceeded for two consecutive weeks. Containers will be transferred in order of priority: those paid but unclaimed for at least 10 days; those assessed but with duties and taxes unpaid 15 days after the notice of assessment; and those with no goods declaration lodged within 15 days from discharge. Containers overstaying beyond 90 days are also subject to transfer, with transfer costs borne by the cargo owner or importer.
MICT confirmed in a June 25 advisory that overstaying containers will move to designated off-site facilities in Laguna, Cavite, and Bulacan. ATI told PortCalls that overstaying containers from Manila South Harbor will be transferred to its Laguna facility.
The second measure is a strict five-day processing window for goods declarations. The Notice of Assessment must be issued within five days from lodgment, with no extensions allowed except for justifiable reasons approved by the deputy collector for assessment. For regulated goods, failure to submit required permits within 15 days from lodgment will trigger the recommendation for a warrant of seizure and detention.
The third measure is the deployment of sweeper vessels. District collectors have been directed to coordinate with terminal operators and shipping lines — particularly those with the largest inventory of empties or those intending to re-export — to allow sweeper vessels to berth for the evacuation and re-exportation of empty containers, directly attacking the depot backlog that has been tying up the truck fleet.
Longer-Term Moves
Beyond the immediate fixes, BOC has signaled a more comprehensive strategic response. Commissioner Nepomuceno has been conducting regular multi-sector coordination meetings among government agencies and industry stakeholders. The bureau is also developing a broader strategy incorporating both operational and policy interventions — including a customs administrative order on the accreditation of container yards and a revived joint administrative order regulating charges imposed by foreign shipping lines, a long-standing grievance of Filipino importers and exporters.
The modernization of e2M remains the most critical long-term technological imperative. Without a stable, scalable customs clearance platform, the gains from any physical or operational improvement at the ports risk being eroded every time the system slows down or goes offline. — PortCalls
Watch out for Part 2: The Airport Crisis
