TO further reduce shipping costs in the Philippines, the country’s port agency will put a ceiling on the fees it intends to collect from private companies which manage its facilities.

A Philippine Ports Authority (PPA) official said that getting a bigger share from concession fees—collected from the lease of privatized facilities—will no longer be the agency’s strategy, since it forces terminal operators to jack up their rates, making shipping costs in the country one of the most expensive in the region.

“Before, the PPA wanted bigger share from the revenues generated by the port operator and we didn’t mind about the tariff. Our ceiling is 10-percent share, some offer us 12 percent, others 15 percent,” said Aida P. Dizon, PPA assistant general manager.

She said the bids and awards committee set up for the PPA’s various privatization initiatives from now on will also consider both the government share and the tariff rates that the bidders will impose on users.

However, the strategy is not expected to erode the port agency’s financial status since it will still award prospective contracts to companies offering the largest financial benefit for the PPA without necessarily passing the cost to users.

Every year, the port agency remits more than a billion pesos to the national government, which is half of its net income, on top of the taxes paid to local governments where some of its facilities are located.

The new strategy could be used for the privatization of the Manila North Harbor, terms of which are still undisclosed known to the public, and other terminals being prepared to be subsumed under private control.

Earlier this year, a PPA directive said that it would lift a 2002 order indicating that the government is entitled to collect 10 percent and 20 percent of the domestic and international operations of cargo handling companies.

The PPA already tested the said measure on the privatization of cargo handling operations of the Dumaguete Port. PPA officials have decided to remove the ceiling of the percentage government share to maximize the benefits.

The privatization of the said port, however, still has to push through due to some regulatory requirements concerning land reclamation.

TO further reduce shipping costs in the Philippines, the country’s port agency will put a ceiling on the fees it intends to collect from private companies which manage its facilities.

THE Philippines’ shipping regulator seeks to end the collusion between foreign shipping companies and domestic maritime training centers which have taken advantage of Filipino sailors desperate to get work onboard oceangoing vessels.