More foreign chambers oppose PPA’s proposal to hike storage fees

More foreign chambers oppose PPA’s proposal to hike storage fees

MORE FOREIGN CHAMBERS are opposing the Philippine Ports Authority’s (PPA) proposal to increase storage fees, saying this is ill-timed.

British Chamber of Commerce Philippines Executive Director Chris Nelson said the PPA’s proposal to hike port storage fees should be reviewed since it may affect inflation.

“The key at the moment is to actually keep bringing inflation down… When you put on storage fees, then of course there’s going to be a pass on to the importers or whoever’s distributing it,” he told reporters on Thursday.

Inflation eased to 4.9% in October from 6.1% in September. This was the slowest pace in three months but October marked the 19th straight month that inflation breached the central bank’s 2-4% target band.

“At this particular moment, you do not want prices going up, we want prices to be lower. So, I think it would be very good if we did look at that,” Mr. Nelson said.

At a public consultation in October, the PPA proposed a 32% increase in the storage charges for import, export, and transshipment containers, according to the Philippine Exporters Confederation, Inc. (Philexport). The PPA also plans to impose a 150% surcharge on the corresponding storage rates with an increase for reefer containers.

The PPA has said the increase in storage charges will ensure optimal use of the yards and encourage immediate withdrawal of containers to prevent congestion.

German-Philippine Chamber of Commerce and Industry President Stefan Schmitz said that the increase in storage fees might not be the “right signal” amid the high inflation environment.

“I think we see it even internationally that everybody’s trying to adjust pricing one way or the other. Inflation presses us all so I’m not sure whether [the increase] is the right signal right now, right when everybody is trying to do things more efficiently than trying to charge more,” he said.

Instead of raising storage fees, Mr. Schmitz said the PPA should look into why containers are being delayed. 

“I think you need to have a look at the reasons why things are delayed. Is it because of inefficiencies during clearances or is it the importers mistake? I can understand that the PPA doesn’t make a distinction there, but I don’t think [that the increase] is the right message, personally,” he added.

In its position letter submitted to the port regulator on Nov. 6, Philexport said the PPA’s proposal should go through a regulatory impact assessment as a standard operating procedure under the Ease of Doing Business law.

Philexport said that the increase is “too onerous” if the PPA will be imposing fees on the overstaying containers due to reasons beyond the shipper’s control such as during the arming and disarming of E-TRACC devices on containers, and downtime of the PPA’s information technology systems, among others.

Meanwhile, the Anti-Red Tape Authority (ARTA) said that it is waiting for any formal request regarding the proposed hike in port storage fees.

“What we always say is that if there is a proposed increase by way of a regulation, it should undergo the regulatory impact assessment,” ARTA Secretary Ernesto V. Perez told reporters last week.

“It is the mandate of ARTA to require the PPA to subject any proposed regulation to increase fees to conduct regulatory impact assessment,” he added. 

Last month, the European Chamber of Commerce of the Philippines opposed the increase in storage charges, saying it will make the country less competitive for trade. 

Last week, American Chamber of Commerce of the Philippines, Inc. Executive Director Ebb Hinchliffe said that the chamber is not in favor of any kind of increase in storage fees as businesses are still recovering from the pandemic.

According to Mr. Hinchliffe, the Joint Foreign Chambers will soon release a statement regarding the issue.

Sought for comment, the PPA is yet to respond as of press time. — Justine Irish D. Tabile