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The Philippine Inter-Island Shipping Association wants a Philippine Ports Authority order implementing a central ticketing system scrapped
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PPA Administrative Order No. 12-2019 is “an unnecessary and intrusive measure that disregards existing private-sector solutions, disrupts business operations, and raises serious concerns about government overreach, data privacy, and economic inefficiencies,” according to PISA
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The system had previously been suspended but Transportation Secretary Vince Dizon this month said it will be implemented within the year
The Philippine Inter-Island Shipping Association (PISA) wants a Philippine Ports Authority (PPA) order implementing a central ticketing system (CTS) scrapped. The group claims the order is without legal basis, redundant, and detrimental to the shipping industry.
PPA Administrative Order (AO) No. 12-2019 is “an unnecessary and intrusive measure that disregards existing private-sector solutions, disrupts business operations, and raises serious concerns about government overreach, data privacy, and economic inefficiencies,” PISA said in a letter to Transportation Secretary Vince Dizon dated April 11, a copy of which was furnished to PortCalls.
PPA is an attached agency of the Department of Transportation (DOTr).
AO 12-2019, issued in November 2019, provides rules on the implementation of PPA’s CTS (also called the electronic ticketing management system or ETMS), an online application procedure that will support an integrated vessel booking and payment system for roll-on/roll-off ports under PPA’s jurisdiction.
ETMS had been pilot-tested at the ports of Batangas and Calapan in September 2020 for planned full implementation in 2021.
Dizon said the ETMS will be adopted within the year. He said the system will provide passengers convenience as they will no longer have to queue at shipping lines’ ticketing booths to buy a ticket, and will also help eliminate the need for “fixers” to secure tickets. ETMS, he added, can be used to prevent overloading of ships since authorities can monitor the number of passengers through the system.
READ: PPA to finally launch electronic ticketing system this year
PISA has always expressed its opposition to the system, the implementation of which was suspended sometime 2022.
READ: Shipping lines seek review of PPA’s “redundant” central ticketing system
PISA argued though that “PPA is clearly bereft of any authority” to issue AO 12-2019 as its charter under Presidential Decree (PD) No. 857 “does not empower the PPA to regulate the processing, booking, or collection of payments from passengers in as much as the PPA’s corporate authority is strictly limited to port operations and logistics, such as berthing, mooring, towing, docking, cargo handling, and warehousing.”
The association pointed out: “There is no mention of ticketing, fare collection, or any authority over the financial transactions between shipping operators and passengers.”
Moreover, it said Section 26 of PD No. 857, which pertains to the PPA’s rule-making authority, does not extend the authority’s power to private business transactions.
While Section 26 grants PPA the power to regulate port operations, PISA said it does not extend to commercial decisions of shipping lines, including how they manage ticketing and payment collection.
“Certainly, the booking and fare collection process is a fundamental aspect of business operations that falls within the management prerogative and discretion of shipping companies. The PPA, therefore, has no authority to interfere in these private commercial transactions, most especially in the absence of any legal mandate,” the association said.
It noted that most shipping companies already have working online ticketing systems “that efficiently manage bookings, payments, and passenger data.”
As an example, PISA cited booking platform Barkota, which it said is “already successfully integrated into major ferry operators, which makes PPA’s intervention redundant and unnecessary.”
PISA argued: “By centralizing ticketing under the government’s control, the PPA will severely disrupt an already functioning system and force companies to abandon their investments in their own booking platforms, which will certainly result in additional costs, inefficiencies, and business uncertainty.”
It also pointed out that a shipping company that called on a port not under PPA jurisdiction would have to maintain two ticketing systems, “which is an undue burden in doing business in the Philippines.”
Moreover, PISA said implementation of ETMS “will create an unprecedented and unwarranted government interference in private business.
“The shipping industry – that provides the most economical and efficient means of connecting the various islands of the country – should not be subjected to an unnecessary burden that is not imposed on other modes of public transport. If the land and air transportation, which also serves millions of passengers, operate without a government-mandated centralized booking system, there is no reason why a centralized ticketing system should be imposed on the shipping industry.”
The association said requiring shipping companies to join ETMS is “a step in the wrong direction,” as even developed countries like the United States, Japan, South Korea, and Germany, “recognize and respect the autonomy of the private sector and businesses in managing their business” and do not intervene in the ticketing systems of private shipping companies.
PISA likewise expressed concern over a potential system crash — whether due to technical issues, cyberattacks, or mismanagement — that would cause “the entire shipping industry (to) come to a standstill leading to the paralysis of the national shipping operations.”
The association noted that AO No. 12-2019 also “fails to provide any concrete measures on how personal and sensitive passenger information will be processed, stored, and protected” unlike private-sector ticketing platforms, which it said comply with strict data protection policies and undergo independent security audits.
In addition, the implementation of ETMS comes at a huge cost of P499.898 million, which PISA claimed is neither necessary nor beneficial to the public and will ultimately be shouldered by taxpayers and passengers.
The joint venture of NextIX, Inc. and Carus Ferry Ab Ltd. was awarded the project in December 2021. The contract was signed in February 2022.
“This is an unjustifiable use of government resources, especially when private-sector alternatives already exist. This means passengers will pay more for tickets to cover these new fees imposed by the PPA,” PISA claimed, adding that such additional costs are not needed while Filipinos are still reeling from the effects of inflation.
Instead, PISA said PPA should focus on improving port infrastructure, which are its core responsibilities under the law.
The problem of scalpers and fixers will also not be solved by ETMS but by the implementation of strict and efficient security measures in ports by PPA itself, the association noted.
On addressing overloading, PISA pointed out this is better addressed by the Philippine Coast Guard (PCG) through vessel inspection and physical headcount prior to vessel departure. PCG already currently conducts pre-departure inspections on domestic ships.
PISA also pointed out the “unfairness” of AO 12-2019, which authorizes PPA to collect the integrated shipping fare, terminal fees, and additional administrative fees but passes the responsibility of giving refunds, rebooking and such other actions under the Rights of Passengers and Obligations of Domestic Operators in Cases of Cancelled, Delayed or Unfinished/Uncompleted Voyages under Maritime Industry Authority Circular No. 2018-07 to shipping companies.
“This is akin to confiscation of property without just compensation. This arrangement is very anti-business with PPA collecting all the money including the fares of the riding public but directing the ship owners to pay for its obligations. Clearly, AO 12-2019 is oppressive and confiscatory, to say the least,” PISA said.
Lastly, it stressed that money collected by PPA are public funds. “Hence, we cannot see how PPA can disburse public funds to the shipping companies without violating the rules and regulations of the Commission on Audit and the Bureau of Treasury.”
PISA noted that no less than two former transportations secretaries, Arthur Tugade and Jaime Bautista, “deemed such PPA policy unnecessary and redundant and held the same in abeyance.”
Despite the shipping companies’ consistent opposition and clamor to nullify PPA AO 12-2019, PISA said PPA insisted on awarding the contract completely ignoring stakeholders’ dissent and opted not to reply to the carriers’ arguments. – Roumina Pablo
