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The Philippine Ports Authority is seeking to revise its policy on free storage period for loaded and empty foreign and domestic containers, expediting the start of the FSP and assessment for storage charges
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PPA said the proposed rules will effectively require cargo owners to pay storage charges sooner due to the “earlier assessment of the free storage period”
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The proposal is a result of the “advancement of technology at tracking actual time of discharging cargo” and ensures “ports are utilized on the most efficient and shortest way possible”
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It underwent public consultation on March 13; stakeholders have until March 21 to submit their position papers
The Philippine Ports Authority (PPA) is seeking to revise its policy on free storage period (FSP) for loaded and empty foreign and domestic containers, expediting the start of the FSP and assessment for storage charges.
The proposed administrative order (AO) will effectively require cargo owners to pay storage charges sooner due to the “earlier assessment of the free storage period”. But it will not change the existing rate of storage charges.
READ: PPA approves higher storage fees for foreign containerized cargoes
The proposal, which underwent public consultation on March 13, will revise PPA rules on the commencement of FSP and assessment of storage charges for containerized cargoes and empty boxes, both foreign and domestic, handled in all PPA government ports.
“With the advancement of technology at tracking actual time of discharging cargo, the Philippine Ports Authority proposed to revise the rules on the commencement of free storage period and assessment of storage charges to ensure that ports are utilized on the most efficient and shortest way possible…” Leila Martinez, division manager of PPA Commercial Services Department-Port Pricing Division, said during the public consultation.
Instead of calendar days, the FSP will be counted by the day and time.
Under the proposal, the FSP will be as follows:
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import – 5 days equivalent to 120 hours, starting on the actual day and time the import container is discharged from the vessel (from the current 5 days starting immediately after the last day that the last item of cargo is discharged from the carrying vessel)
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export – 4 days equivalent to 96 hours, starting on the actual day and time the export container enters (gate-in) the port for export (currently 4 days starting from the day that the cargo is received at the port)
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foreign transshipment – 15 days equivalent to 360 hours, starting on the actual day and time the foreign transshipment container is discharged from the vessel (currently 15 calendar days starting from the day of arrival to the day of departure)
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inbound domestic – 2 days equivalent to 48 hours, starting on the actual day and time the inbound domestic container is discharged from the vessel (currently two calendar days after the day that the last item of cargo is unloaded from the carrying vessel)
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outbound domestic – 2 days equivalent to 48 hours, starting on the actual day and time the outbound domestic container enters (gate-in) the port for loading (currently two calendar days prior to the day that the carrying vessel is scheduled to arrive)
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shut-out (not loaded on their scheduled vessel) domestic – 2 days equivalent to 48 hours, starting on the actual day and time the container enters the port until it is loaded onto the designated vessel, provided that any delay is not attributable to the port terminal management operators /cargo-handling operators/terminal operators (currently two calendar days after vessel’s departure)
The assessment of storage charges will start after the expiration of the FSP based on the hours, for example after the 120 hours FSP for import containers.
Currently, the assessment of storage charges starts the day after the expiration of the FSP, or for example on the fifth day or after expiration of the four-day FSP for export containers.
For import containers though, the storage charge currently starts on the sixth day at 0001 hours, except in Manila South Harbor and Manila International Container Terminal where the storage charge starts on the sixth day at 0701 hours.
Under the proposed AO, the storage charge will accrue based on the following:
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import containers – storage charge will accrue per calendar day after the expiration of 120-hour FSP, to be computed until the actual day and time of exit from the gate or from the designated port, provided that a fraction of a day shall be considered as one day.
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export containers – storage charge will accrue per calendar day after the expiration of 96-hour FSP, to be computed until the actual day and time of loading onto the carrying vessel, provided that a fraction of a day shall be considered as one day.
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foreign transshipment – storage will accrue per calendar day after the expiration of 360-hour FSP, to be computed until the actual day and time of loading onto the carrying vessel, provided that a fraction of a day shall be considered as one day.
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inbound domestic containers – storage charge will accrue per calendar day after the expiration of 48-hour FSP, to be computed until the actual day and time of exit from the gate, provided that a fraction of a day shall be considered as one day.
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outbound domestic containers – storage charge will accrue per calendar day after the expiration of the 48-hour FSP, to be computed until the actual day and time of loading onto the carrying vessel, provided that a fraction of a day shall be considered as one day.
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Shut-out domestic containers—storage charge will accrue per calendar day after the 48-hour FSP, to be computed upon until the actual day and time of loading onto the carrying vessel, provided that fraction of a day shall be considered as one day. If the cargo is not loaded as scheduled, the resulting fee will be paid for by whoever is at fault. If an outbound domestic containerized cargo has been shut out, the applicable FSP should not be cumulative.
To illustrate the change between the existing policy and the proposed one, Martinez provided samples.
For import containers, the present rule states that FSP will immediately commence after the day that the last item of cargo is discharged from the carrying vessel. For example, if the import container is discharged on March 10 at 1300 hours and the last container is discharged on March 12 at 1400 hours, the FSP will start on March 13 at 0701 hours to March 14 at 0700 hours. If the container is not withdrawn after the five-day FSP, then the storage charge will commence on March 18.
Under the proposed rule, if the first container is discharged on March 10 at 1300, then the FSP will start immediately on March 10 at 1300 hours. If the container is not withdrawn within the five-day or 120 hours FSP, the storage charge will commence on March 15.
For domestic inbound, the current rule is that FSP is two calendar days from after the date of entry into the port while for the proposal, it will commence on the actual day and time the container is discharged from the vessel.
So for example if the last item of cargo was discharged on July 20 at 1300 hours, FSP will start on July 21 at 0000 hours and if not withdrawn within the FSP, the storage charge assessment shall start on July 23 under present rules. Applying the proposed rule, the FSP will immediately commence on July 20 and the storage charge will start on July 22.
READ: Who pays for storage charges at end of FSP? Shipping lines, asserts PPA
Under the proposed AO, PPA’s Internet-based Port Operations Receipting for Terminals System (iPorts) will be interfaced or made interoperable with the terminal operating system (TOS) software of terminal operators (TO), cargo-handling operators (CHO), and port terminal management offices (PTMO) for real-time monitoring and storage charge assessments via application program interfaces (APIs).
The API specifications for the interface will be drafted. Other software systems of PPA and the TOs, CHOs, and PTMOs that are identified to be relevant for the proper computation of storage charges may be included in the API as well, subject to the approval of all parties.
Under the proposed AO, PPA’s PMOs should ensure real-time monitoring of domestic/foreign containerized cargo movements, and the accuracy of storage charges computation as basis for the proper collection of government revenue, if any.
For ports/terminals where storage charge is payable to PPA, iPorts will be utilized in the real-time monitoring of container movement and assessment of storage charges.
Stakeholders have until March 21 to submit their position paper on the proposed AO – Roumina Pablo
