RESOLVING THE BANE OF PORT CONGESTION

The situation at the country’s ports has a lot of bearing on the economy, particularly on prices of commodities that have lately been on an uptrend. Containers stuck at the country’s harbors have slowed the flow of goods, if not halt it altogether, creating an artificial shortage in the market. And based on Bureau of Customs reports, farm product syndicates may also be using the container boxes for hoarding. The situation may not even be the result of the supply chain crisis as it may be intentional, indicating that the hoarding of goods is happening. The Philippine Ports Authority has complained that its hands are tied. The government is prevented from inspecting or opening the boxes at the port yard facilities without a court order, as the law does not allow the arbitrary opening of the boxes even by law enforcers.

Most of the boxes are overstaying containers. Some others cannot be processed because they lack permits and clearances from the Bureau of Quarantine.

“[The situation] is alarming as these idle cargoes have significant numbers of goods inside. We do not allow hoarding, but we cannot do anything. Hoarding is the call of importers. It is not in our purview to know what is inside the container, but that of the Bureau of Customs,” PPA general manager Jay Santiago said.

To address this problem, the BoC has accelerated the digitalization of customs processes and operations to enhance trade facilitation and maintain port efficiency.

Ruiz said the ongoing BoC operation against agricultural smuggling, for instance, is in line with the order of President Ferdinand “Bongbong” Marcos Jr. to stop such activities, and also an assurance to the public that the BoC is on top of the situation.

“We are fully aware of the problems of our kababayan because of the prices of goods, particularly fresh onions. We are taking extra steps to make sure smugglers and hoarders are brought to justice and free our market from illegally sourced and imported products that could further impact the agricultural sector,” Ruiz said.

In 2022, BoC conducted 156 seizures of agricultural products valued at P2.244 billion.

Digitalization projects

To make its operations efficient, the BoC implemented seven digitalization projects in 2022, namely, the Liquidation and Billing System or LBS; Electronic Customs Baggage and Currencies Declaration System; Raw Materials Liquidation System, National Customs Intelligence System; Electronic-2-MobileElectronic Tracking of Containerized Cargo System; Payment Application Secure 6; and Asean Customs Declaration Document System.

The LBS is a platform used by the Bureau’s liquidation and billing division to send notices and demand letters as needed.

The iDeclare enables passengers and crew members to submit their baggage and currency declaration forms before arrival and departure, while the Raw Materials Liquidation System determines the volume and value of the raw materials exported subject to liquidation, including the duties and taxes due on the imported article/s entered through warehousing but are no longer used for the manufacture of export articles.

The NCIS stores data from all the intelligence sources via Web forms and Excel format.

The E2M-Etracc integration, meanwhile, allows E2M to exchange data with the Etracc to provide and capture the actual arrival time of containers at their destination.

The PAS6 is an upgraded version of the Payment Application Secure 5 system designed for more efficient payment facilitation. The added feature ensures the accurate and immediate exchange of transaction information on the assessment details of payable duties and taxes.

The ACDD is a digital tool that shares information with Asean members, and is expected to improve bureaucratic efficiency and reduce barriers to entry.

Ruiz had ordered all ports to expedite the disposition of all forfeited and abandoned goods to prevent high yard utilization.

As a result, the BoC disposed of 1,325 overstaying containers, auctioned off 443 containers loaded with rice and galvanized steel and other items, condemned

841 containers, and donated 41 containers to various government agencies in 2022.

The BoC also inaugurated the Authorized Economic Office or AEO last 19 December 2022 to institutionalize AEO Philippines.

The AEO is a key component of the World Customs Organization’s SAFE Framework of Standards to promote the seamless movement of goods through secure international trade supply chains.

Additional revenues

The Bureau of Customs has also earned additional revenues from auctions of overstaying cargo.

It collected over P292 million from the public biddings of forfeited goods for 2022.

The BoC said selling these cargoes not only added to government income but also freed up space at the ports.

The move was in accordance with Ruiz’s order to all ports to process all forfeited and abandoned items as quickly as possible, using methods permitted by the Customs Modernization and Tariff Act.

The Asian Terminals Inc., Association of International Shipping Lines, and BoC-Port of Manila continuously implement the Empty Loadout Shipping Agreement.

Under the scheme, vessels docked at Manila South Harbor can load empty containers available at the port.

Jurisdiction

The BoC and the Philippine Ports Authority agreed in 2017 on how the proposed provisions on the jurisdiction of container yards and the facilitation of permits within the South Harbor and the Manila International Container Port should be interpreted.

“The PPA and BoC have discussed each other’s requirements and are working together to address the need of Customs for an area where they can secure seized and abandoned cargoes, among other concerns. The free flow of containers in and out of the port is essential to prevent another port congestion,” said Fernando Perez, the Transportation Assistant Secretary for Maritime at that time.

The PPA released Administrative Order 04-2021 almost two years ago to help solve port congestion, saying that foreign containers must register with the government agency’s Trusted Operator ProgramContainer Registry and Monitoring System.

The TOP-CRMS, according to PPA assistant general manager for finance and administration Elmer Nonnatus Cadano, is part of the port authority’s efforts to digitalize processes and make port operations more efficient by preventing port congestion.

The system also contributes to the PPA’s campaign against smuggling by “helping the Bureau of Customs enforce its 90-day policy for reexporting foreign containers,” Cadano stressed.

The TOP-CRMS and Empty Container Storage Shared Service Facility procurement contract was awarded to local blockchain-based logistics joint venture company Shiptek Solutions Corp., and NextIX, Inc., in April 2022.

Additionally, BoC has already begun implementing the container identification and accountability program of the World Customs Organization Cargo Targeting System, which mandates that all foreign shipping companies in the Philippines send WCOCTS information about their containers and import shipments in advance.

PORT services must be standardized, affodable, and easy to access.