-
The Philippine Ports Authority clarified that private ports are excluded from the fuel surcharge adjustment (FSA) mechanism, a temporary cost-recovery measure for port operators facing rising fuel prices
-
The FSA mechanism applies solely to cargo handling operators, terminal operators, and service providers within PPA ports whose rates are subject to PPA regulation and approval
-
The mechanism does not regulate, prescribe, or standardize fuel surcharges independently set by shipping lines
-
It does not grant the PPA authority to regulate freight rates, shipping charges, or privately negotiated commercial fees
The Philippine Ports Authority (PPA) has clarified that private port facilities are exempt from the Fuel Surcharge Adjustment (FSA) mechanism, a temporary cost-recovery measure allowed for port operators during fuel price surges.
Through Operations Memorandum Circular (OMC) No. 003-2026, PPA emphasized that the FSA applies exclusively to cargo-handling operators, terminal operators, and service providers operating within PPA-managed ports where tariffs and charges are directly regulated by the agency.
Private ports and facilities operating outside PPA jurisdiction are excluded because their landside rates and commercial contracts are not subject to PPA regulation or approval.
“The mere existence of a permit, accreditation, or regulatory relationship with PPA shall not be construed as authority to implement the FSA Mechanism on privately imposed landside rates or charges,” the agency stated in OMC 003-2026.
Shipping Line Rates Excluded
PPA further clarified that the FSA mechanism does not apply to fuel surcharges or freight rates set independently by shipping lines. The rule does not give PPA authority to regulate, prescribe, or standardize carrier freight rates or privately negotiated commercial charges.
READ: PPA issues guidelines on fuel surcharge adjustment for port operators
The clarification follows inquiries from PPA Port Management Offices (PMOs) and trade stakeholders regarding the scope of the mechanism, operational requirements, and whether shipping lines were obligated to align with PPA-prescribed FSA rates.
Issued in May under Administrative Order (AO) No. 005-2026, the FSA allows port operators to recover incremental fuel cost increases based on weekly Department of Energy (DOE) price references. Designed as a temporary cost-recovery tool rather than a profit-generating charge, the surcharge cannot be implemented without prior PPA approval and must be itemized separately on billing statements. Moreover, it should not form part of the base tariff or be used in computing any government share, concession fee, or similar charges.
Applicable FSA rates continue to be calculated based on formula guidelines and weekly advisories issued by PPA’s Commercial Services Department every Monday. —Roumina Pablo
