Authority, legal basis, and scope
- The Circular is issued pursuant to Sections 2(f) and 20 of P.D. 857, as amended.
- The Circular is also issued in relation to Memorandum Circular No. 121 issued by the Office of the President on November 2, 1990.
- The Circular implements PPA Memorandum Circular No. 07-94 on the new port charges by prescribing regulations to ensure proper assessment and collection.
- The Circular applies to calls/discharges at government/private ports or anchorage areas under PPA jurisdiction, including vessels engaged in international/foreign and domestic trade.
Core definitions for port charges
- Authority refers to the Philippine Ports Authority.
- Dockage is the amount assessed for mooring/berthing or making fast:
- Dockage (at Berth) is assessed against a vessel engaged in international/foreign trade (including barter trade) for mooring/berthing at a pier/wharf/bulkhead/river or channel marginal wharf at any national port, or for mooring/making fast to a vessel already berthed.
- Dockage (at Anchorage) is assessed against such vessels that do not berth but drop anchor at either a government or privately-owned port, whether operated exclusively or commercially.
- Port Charges include port dues, dockage at berth, dockage at anchorage, usage and lay-up fees, wharfage, and storage fees assessed on the vessel/cargo.
- Port Dues are assessed against a vessel engaged in foreign trade based on its total GRT (gross registered tonnage) or part thereof, including barter trade, for each entrance into and departure from a port of entry in the Philippines.
- Revenue Tonnage means 1,000 kgs or 1.1326 cubic meters (40 cu. ft.), whichever yields the greater amount of revenue.
- Free Storage Period is the period allowed for any article/baggage/container stored in Authority port premises, cargo sheds, and warehouses without payment of storage fee.
- Usage Fee is the amount assessed against a vessel engaged in domestic trade for berthing/making fast or for mooring at an anchorage area.
- Lay-up Fee is the amount levied against vessels engaged in domestic trade temporarily authorized to lay-up and anchor at designated lay-up areas.
- Vessel in Distress covers vessels that suffered engine trouble, marine accident, or met a typhoon/natural calamities/disasters forcing a call for repair, medical help, or shelter.
- Shut-out Cargoes are cargoes brought to government port premises/sheds/warehouses for export or domestic shipment that are not loaded on the intended carrying vessel, provided the carrying vessel has actually docked.
- Wharfage is a charge on all cargoes, containerized or not, coming in/going out or transshipped through a port, based on total metric or revenue tonnage whichever is applicable.
Port dues, dockage, and anchorage rules
- Port Dues are charged on vessels:
- entering the port to load/discharge cargo or to embark/disembark passengers; and
- entering to bunker/take provisions, repairs, or change crew members.
- For vessels calling on several ports within the same harbor, Port Dues are charged only for one (1) call, paid at the first port of call.
- Dockage at Berth applies to:
- cargo vessels engaged in international/foreign trade that berth to discharge and/or load cargo; and
- non-cargo vessels engaged in international/foreign trade that berth for loading/taking passengers, taking fresh water, receiving bunker fuel, or changing crew.
- Vessels engaged in international/foreign trade that do not berth but drop anchor at a government or registered privately-owned port are charged dockage at anchorage or one-half (1/2) of the corresponding dockage at berth at a government port, subject to a maximum of 50,000 GRT.
- Dockage payment liability is on the owner, agent, operator, or master of the vessel for dockage at berth or anchorage.
- Diversion due to congestion: if a vessel is diverted from a government port to a private port by the Port Manager due to congestion or other causes, it is liable only to 50% of the dockage payment at a government berth.
- Assessment of dockage—time counting:
- A fraction of a day counts as one (1) whole day for dockage fees at berth or anchorage.
- If a vessel stays at anchorage and subsequently berths (or berths and subsequently shifts to anchorage) within the same day and not beyond 12:00 midnight, it is counted as one (1) day and the vessel pays dockage at berth.
- Exemption while waiting at anchorage:
- Time spent at anchorage waiting for a dockside berth is not subject to dockage or anchorage usage fees if no loading/unloading is undertaken, and the waiting is due to strikes, natural calamities, or pier congestion.
- Pier congestion exists when there is no suitable/adequate dockside berth that can safely/effectively accommodate the vessel considering draft and cargo handling requirements, or when obstructions prevent vessel operations at the dockside berth.
- Long and deep draft vessels waiting at a designated anchorage area (or, for South Harbor in Manila, at the outside breakwater (OBW)) are exempt from payment of dockage at anchorage during such waiting time when a berth is available but inadequate/not suitable, provided no loading/unloading is undertaken.
- Agents that opt to wait for a preferred berth even if other suitable berths exist do not receive exemption during the waiting period.
- When exemptions start and stop:
- Dockage/usage fee exemption commences on the first day the vessel is at anchorage waiting for a berth and ends when it is berthed.
- Dockage at berth/usage fee is reckoned from final berthing time to departure.
- Dockage at anchorage is reckoned from when the vessel drops anchor to when it lifts anchor.
- Limit to the exemption: exemption does not apply when a vessel is pulled out from its assigned dockside berth after completion of loading/unloading but is not yet ready to depart; the vessel is assessed dockage at anchorage or usage fees while at anchor in addition to dockage/usage fee while at berth.
- Maximum for large vessels: vessels of more than 50,000 GRT are charged dockage equivalent to 50,000 GRT.
- No maximum limit for Port Dues per call: Port Dues are assessed every time a vessel calls, with no maximum limit, but vessels calling on several ports within the same harbor are charged only for one (1) call and paid at the first port of call.
Usage fee and lay-up fee obligations
- Usage Fee is assessed on vessels for:
- loading or discharging cargo or passengers;
- being at anchorage or at berth to bunker, take provisions, do repairs, or change crew;
- private non-commercial watercrafts;
- vessels engaged in “Bay and River Trade”; and
- barges and lighters.
- Domestic trade calling PPA-registered private ports: vessels engaged in domestic trade calling at a PPA-registered private port, whether operated exclusively or commercially, are charged one-half (1/2) of the usage fee at a government port; registered bay and river trade vessels are also charged one-half (1/2) of the usage fee.
- Usage fee time counting: a fraction of one (1) day counts as one (1) whole day.
- Waiting time rule: time spent waiting for berth is not included in usage fee; the same exemption principles for foreign vessels waiting for berth apply to domestic vessels.
- When usage fee starts/ends:
- from when a vessel makes fast to when it lets go the line; or
- from when it drops anchor to when it lifts anchor for another port.
- Bay and River Trade: usage fee is charged every time such vessels call at the port subject to the minimum and maximum charges prescribed in MC No. 07-94.
- Lay-up Fee—what triggers it:
- vessels engaged in domestic trade authorized to temporarily lay-up and anchor at designated places in the port; and
- laid-up vessels that are decommissioned and idle while waiting for better business prospects.
- Decommissioned vessels are vessels not engaged in commercial trade as certified by MARINA.
- Lay-up Fee rate: authorized domestic trade lay-up vessels are charged a lay-up fee equal to one-half (1/2) of the usage fee.
- Lay-up fee start date: lay-up fee is reckoned from the date of approval of the lay-up.
- Lay-up procedure and required documents:
- normal procedures for application for berth and issuance of a berthing permit apply, with the applicant requesting specifically for a berth in the lay-up area;
- the application must be accompanied by:
- a Certificate of decommission from MARINA; and
- a certificate under oath that the vessel/watercraft will not be used for dwelling purposes and that no repair work will be done onboard while berthed at the lay-up areas.
Dockage/usage penalties for idle berth occupation
- Idle vessels occupying a dockside berth at any government port despite a shifting order from the Port Manager (or authorized representative) to give way to an incoming operating vessel are assessed:
- Three Hundred (300%) percent of the applicable dockage fee (at berth) for foreign vessels; and
- Five Hundred (500%) percent of the applicable usage fee for domestic vessels.
- Payment for the foregoing idle-berth penalty must be made by the owners, agents, or representatives prior to actual departure from berth.
- Where vessels occupy dockside berth despite a shifting order but are covered by a restraining order, injunction, writ of attachment, or similar orders from a competent court, the assessed charges are:
- Six Hundred (600%) percent of the applicable dockage (at berth) for foreign vessels; and
- One Thousand (1000%) percent of the applicable usage fee for domestic vessels.
- For court-covered cases, the assessed charges must be paid immediately after the decision by the competent court, paid to the party granted the favorable judgment/order.
Wharfage assessment and special transshipment rules
- Wharfage is charged on all cargoes loaded or unloaded at any government or private port.
- The owner or consignee of the article, or the agent of either, is liable for wharfage.
- Government wharves/piers rate structure:
- 100% (One Hundred (100%) Percent) wharfage rates apply to cargoes loaded/unloaded at government wharves/piers;
- only 50% (Fifty (50%) Percent) is imposed on cargoes loaded/unloaded at anchorage or midstream.
- Private port registered with Authority:
- foreign and domestic cargoes loaded/discharged from a vessel in a private port registered with the Authority are charged 50% (Fifty (50%) Percent) of the wharfage rate prevailing in the government port.
- Containerized wharfage—FCL vs LCL:
- wharfage for containerized cargo applies only on FCL containers;
- LCL containers are charged rates for non-containerized cargoes,
- except LCL singles, which are charged wharfage per box provided no stripping or stuffing is done in port.
- Non-containerized wharfage timing and basis:
- foreign and domestic non-containerized cargoes are charged wharfage every time loaded/unloaded in a port based on total revenue or metric tonnage, whichever is applicable, rounded to the nearest in case of non-containerized cargo, or per box basis for containerized cargoes.
- Empty containers: empty containers (domestic or foreign) are not charged wharfage if owned by the carrying vessel; empty containers manifested as commercial cargo are subject to wharfage.
- Foreign transshipment wharfage:
- foreign transshipment cargo is charged wharfage only upon entrance at the port (per metric ton, revenue ton, or per box as applicable) payable by the shipping line/agent;
- outgoing foreign transshipment cargo is not charged wharfage.
- Presidential special rates for crude oil and fertilizer transshipment:
- wharfage charges on foreign transshipment cargo do not apply to transshipment of crude oil (LOI No. 1352) and fertilizer granted special rates by the President;
- wharfage for transshipment of crude oil is P2.40/M.T. effective 1994 and P2.80 effective April 3, 1995;
- wharfage for transshipment of fertilizer is P2.30/M.T. effective 1994 and P2.70 effective April 3, 1995.
- Conditions for applying special transshipment rates:
- new transshipment rates apply to imported crude oil intended to be refined/processed and later re-exported, and to bulk imported fertilizer to be bagged in the Philippines and subsequently re-exported.
- if the finished product or crude oil itself is sold in the local market or consumed locally, regular import wharfage applies.
- likewise, regular import wharfage applies when fertilizer transshipment is sold or consumed locally instead of being transshipped to destination.
- Import/export wharfage interplay:
- import cargo is subject to foreign wharfage at port of entry, and coastwise movement is subject to domestic wharfage; the reverse applies to export cargo.
- Processing exemption claims for wharfage:
- claims for wharfage exemption under presidential issuances or laws must be supported with certified copies and supporting documents relied on as basis;
- doubts on interpretation must be referred to the Head Office for final resolution before exemption is granted.
- BOI export wharfage exemption (for registered firms):
- only exportation of registered products of BOI-registered firms under R.A. 6135 (Export Incentives Act) and the Investment Code of 1987 (E.O. 226 or P.D. 1789 as amended by B.P. Blg. 391) is exempt from payment of export wharfage; coastwise shipments and importations remain subject to wharfage.
- only main products in the certificate of registration are exempt; by-products/derivatives are not exempt.
- eligibility is established primarily from the original or certified true copy of the certificate of registration, counterchecked against the “List of BOI Registered Companies” furnished to PDOS and PMOS by the Commercial Services Department.
- exemption is limited to the period under the Investment Code of 1987—ten (10) year exemption period reckoned from the date of registration of the export product or start-up of operation, whichever comes later.
- BOI enterprises registered under laws prior to the Investment Code laws continue to enjoy incentives indefinitely (with further particulars to follow PPA MC No. 37-91).
- if doubt exists on eligibility, it must be resolved against exemption; assessed wharfage fees are paid under protest, and payments under protest are submitted by the concerned PDO/PMO to the Commercial Services Department for proper disposition in coordination with the Legal Services Department.
Refund of port charges procedures
- Refund for overpayment or double payment of port charges is entertained only after a formal written request is filed with the PMO concerned.
- Refund vouchers and checks are issued only after thoroughly ascertaining that a double payment or overpayment actually occurred.
- A refund request must be filed within three (3) months from the date of actual payment of port charges by the consignee, shipper, or broker (as the case may be).
- Failure to file within three (3) months forfeits the claimant’s right for refund from the date a Bill of Charge becomes due and payable.
- Receipt of a deposit for port charges that are not yet due and payable is treated as an advance payment applied against the corresponding Bill of Charge, not as actual payment.
Storage fee liability and free-storage counting
- Storage charges apply to cargoes that remain stored within/outside transit sheds or laid in the open yard storage not leased to a private entity in any government-owned port, or stored in Authority warehouses beyond the free storage period.
- Responsibility for storage fee payment rests on the shipper or consignee (as the case may be).
- A fraction of a day counts as one (1) whole day in assessing storage fee.
- The Free Storage Period counts include Sundays and Holidays and is computed by cargo type:
- Imported cargoes: six (6) calendar days free storage begins immediately after the day the last item is discharged.
- Export cargoes: five (5) calendar days begins on the day cargo is officially received at the port.
- Foreign transshipment: fifteen (15) calendar days from day of arrival to day of departure.
- Outbound domestic cargoes: two (2) calendar days prior to the scheduled vessel arrival date announced and approved by the PPA Port Manager.
- Inbound domestic cargoes discharged at any port: two (2) calendar days beginning after the day the last item is unloaded.
- Rice and corn shipments receive additional two (2) calendar days free storage.
- Shut-out domestic cargoes: two (2) calendar days beginning on the day the vessel where the cargoes are intended to be loaded departs; corresponding storage charges are paid by whoever is at fault.
- Storage fee per box for containers: applicable only to containers, whether or not they contain cargo, determined by the number of calendar days the container stays after the free storage period.
- Storage fee for LCL containers: charged at the rate for non-containerized cargoes, determined by total revenue tonnage and number of calendar days after the free storage period.
- Imported cargo in transit at a domestic port: liable to domestic storage in addition to any import storage fee paid at the entry port.
- Export cargo in transit at a domestic port: liable to domestic storage fee.
- Foreign transshipment cargo delivered to local end users: treated as imported cargo and loses transshipment special benefits.
- The PPA Board of Directors may adjust or suspend the free storage period and/or increase storage charges for ports declared congested, but foreign transshipment containers are not subject to escalation.
Exemptions from vessel charges and wharfage/storage
- AFP and certain government training vessels are exempt from Usage Fee if used exclusively for training purposes.
- Naval, diplomatic, and academic vessels owned by a foreign government and not carrying cargo or passengers and not for hire are exempt from all vessel charges, provided the foreign government grants the same privileges to Philippine Government-owned vessels.
- Vessels in distress or seeking shelter from inclement, entering for medical help, maritime necessity, and other humanitarian reasons are exempt from all vessel charges.
- Where the State has arrangements with a foreign government regarding vessels not normally engaged in cargo or passenger conveyance, such vessels are exempt from all vessel charges.
- Drydocking/repair vessels: vessels certified by a Classification Society or undergoing repair at duly authorized drydocking or MARINA-accredited shipyard facilities are exempt from dockage/usage fees from the time they call at a shipyard facility up to completion of repair/drydocking and departure.
- Shipbreaking exemptions: vessels certified by MARINA for shipbreaking at a duly accredited shipbreaking yard are exempt from all vessel charges.
- Shipbreaking scrap wharfage:
- scraps resulting from shipbreaking of foreign vessels that are re-exported or sold locally are exempt from wharfage;
- scraps resulting from shipbreaking of domestic vessels are also exempt from wharfage.
- Extent of scrap wharfage exemption: scrap wharfage exemption for foreign/domestic shipbreaking extends up to the final port of destination across other way ports where scraps are loaded/unloaded.
- Change of ownership: exemption from wharfage applies even when ownership of scraps changes from the original shipbreaker to the buyer(s), evidenced by shipbreaking contract and deed of sale.
- Notification requirement for shipbreaking: the firm must officially notify the Authority before the start of shipbreaking and must provide:
- GRT and deadweight tonnage,
- age of the vessel,
- origin of the vessel and place of shipbreaking yard,
- estimated volume of scraps including engine.
- Authority stoppage due to congestion or justifiable causes: if the Authority stops a vessel from discharging/loading cargo to avoid congestion or for other justifiable causes, the vessel is exempt from dockage at berth or dockage at anchorage or usage fee during the suspension period unless loading/unloading operations are undertaken.
- Donations exemptions:
- donations from international or local organizations duly authorized or registered by DSWD or the Office of the President are exempt from wharfage and storage charges;
- for storage charge exemption, there must be evidence the donation is requested for release/delivery within seven (7) days from notice of arrival.
- DSWD relief goods: relief goods covered by diplomatic notes 1071 and 3001 are exempt from port charges.
- Empty containers for exportation of Philippine products: empty containers imported into the Philippines and/or transshipped to other domestic ports for use in exporting Philippine products are exempt from wharfage.
- Mailbags are not subject to wharfage; articles sent through the mails but not contained in mailbags are subject to wharfage.
Repeal, separability, and publication rule
- Repealing clause: PPA Memorandum Orders No. 20-83 and 20-83A and all other PPA issuances, memoranda, circulars, orders, rules and regulations, policies or parts thereof inconsistent with or contrary to this Circular are modified or repealed.
- Separability clause: if any section or provision is declared unconstitutional or invalid, the remaining sections/provisions continue in full force and effect.