Gov’t agencies studying ways to bring down shipping cost

Regulations to address high shipping charges may take the form of a law instead of an earlier plan to issue an executive order (EO), according to the Department of Trade and Industry (DTI).

Trade Undersecretary Rowel Barba said agencies such as the DTI, Department of Finance (DOF) and Department of Transportation (DOTr) are studying how to address the high shipping rates in the country, which is among the concerns of local businesses.

“DTI-DOF and DOTr are still discussing the best option. It appears that the best option is legislation,” he said in a text message.

During the Second Logistics Services Philippines Conference and Exhibition held in July, Trade Secretary Ramon Lopez said the DOTr, DTI, DOF technical working group would reconvene to reconstitute the joint administrative order (JAO) which would cover regulations on charges being imposed by shipping lines into an EO.

“We believe it will address the institutional arrangements required to regulate high shipping costs, and address the problem of port inefficiencies, but legal basis must be clearly established. Maybe the JAO would need teeth. Therefore, it must really be an EO that will spell the difference. That is our latest decision,” he said earlier.

While the JAO will cover the cooperation of different agencies in addressing concerns raised on high shipping costs and congestion at ports, Lopez said the EO would specify which agency would be accountable for setting or having control over the allowable shipping rates.

Earlier this year, the agencies agreed to come up with a JAO to regulate and specify the rules and regulations to govern fees and charges of shipping lines, port operators, truckers, and port users to lower operating costs and improve logistics efficiencies.

This JAO was initially eyed for release in February.

The government made a move to come up with a JAO to address concerns raised by the private sector, particularly high shipping charges and congestion at Manila’s ports.

Based on data received and validated by the DTI, additional shipping charges being imposed reach up to around $1,000 per container.

In addressing the high shipping charges, Lopez said earlier the government is looking at coming up with a cap or range, as well as the number of allowable fees to be charged.

Implementation of the JAO is among the recommendations in the draft resolution to be submitted by the country’s largest business group, the Philippine Chamber of Commerce and Industry to President Duterte during the 45th Philippine Business Conference and Expo to be held this week.