AN ACT ALLOWING FOREIGN VESSELS TO TRANSPORT AND CO-LOAD FOREIGN CARGOES FOR DOMESTIC TRANSSHIPMENT AND FOR OTHER PURPOSES

Case Overview and Summary

Summary of Republic Act No. 10668

Declaration of Policy (Section 1):
- To assist importers and exporters in enhancing their competitiveness in international trade.
- To lower the cost of shipping export and import cargoes for the benefit of consumers.

Definitions (Section 2):
- Co-loading: Agreements between sea carriers to load, transport, and unload each other's containers/cargo bound for the same destination.
- Container van: A standardized reusable steel box for storage and movement of materials within an intermodal freight transport system.
- Domestic cargo: Goods intended to be shipped from one Philippine port to another, even if there is an intervening foreign port.
- Export cargo: Goods carried by foreign vessels and declared for shipment to a port outside the Philippines.
- Foreign cargo: Import or export cargo carried by a foreign vessel.
- Foreign container van: A container van belonging to a foreign vessel, whether empty or loaded with foreign cargo.
- Foreign port: Any seaport outside the jurisdiction of the Philippines.
- Foreign ship operator: A citizen, partnership, or corporation owning or chartering a foreign vessel.
- Foreign vessel: A ship registered or documented in a flag registry other than that of the Philippines.
- Import cargo: Goods of foreign origin carried in a foreign vessel intended for delivery within the Philippines.
- Philippine port: Any port within the Philippines authorized to handle domestic import or export cargo.
- Port Authorities: Entities engaged in the development and operation of seaports.
- Transshipment: Transfer of cargo from one vessel to another for further transit to its final destination.

Scope (Section 3):
- This Act applies exclusively to foreign vessels carrying foreign container vans or foreign cargoes.

Carriage of Foreign Cargo by a Foreign Vessel (Section 4):
- A foreign vessel arriving from a foreign port shall be allowed to carry foreign cargo to its Philippine port of final destination, after being cleared at its port of entry.
- A foreign vessel arriving from a foreign port shall be allowed to carry foreign cargo by another foreign vessel calling at the same port of entry to the Philippine port of final destination of such foreign cargo.
- A foreign vessel departing from a Philippine port of origin through another Philippine port to its foreign port of final destination shall be allowed to carry foreign cargo intended for export.
- A foreign vessel departing from a Philippine port of origin shall be allowed to carry foreign cargo by another foreign vessel through a domestic transshipment port and transferred at such domestic transshipment port to its foreign port of final destination.
- An empty foreign container van going to or coming from any Philippine port, or going to or coming from a foreign port, and being transshipped between two Philippine ports shall be allowed.

Authority of the Commissioner of Customs (Section 5):
- The Commissioner of Customs may authorize the conveyance of foreign cargo brought from abroad by a foreign vessel.
- The Commissioner of Customs may allow a foreign vessel to take cargo intended for export at any Philippine port and convey the same upon such foreign vessel to a foreign port.
- The Commissioner of Customs may authorize the transshipment of foreign cargo intended for import or export through another Philippine port by another foreign vessel to the cargo's port of final destination.
- The Commissioner of Customs shall not diminish or impair any existing and valid government contract covering the handling of import and export cargo.
- The Commissioner of Customs shall have the authority to impose penalties on foreign ship operators found to have violated any provision of this Act and to take measures to address illegal activities, including smuggling.

Application of the Carriage of Goods by Sea Act (Section 6):
- Carriage conducted in accordance with this Act shall be governed by Commonwealth Act No. 65, otherwise known as the "Carriage of Goods by Sea Act" with respect to the liability of the carrier for the loss of, or damage to, goods carried.

Carriage by Foreign Vessels Not a Public Service, Foreign Vessels Not Common Carriers (Section 7):
- Foreign vessels engaging in carriage conducted in accordance with this Act shall not be considered common carriers as provided in Republic Act No. 386, otherwise known as the "Civil Code of the Philippines".
- Foreign vessels engaging in carriage conducted in accordance with this Act shall not be considered as offering a public service and thus shall fall outside the coverage of Republic Act No. 9295, otherwise known as the "Domestic Shipping Development Act of 2004".

Prohibitions (Section 8):
- Foreign ship operators shall submit their cargo manifest to the Port Authorities to ensure that no domestic cargoes are carried by the foreign ship.
- No foreign vessel shall be allowed to carry any domestic cargo or domestic container van, whether loaded or empty, even if such domestic container van may contain foreign cargo.

Fines and Penalties (Section 9):
- The Bureau of Customs, upon due notice, hearing and determination of the existence of any breach or violation of the provisions of this Act or any rule and regulation issued pursuant thereto, shall impose a penalty or fine on any erring foreign ship operator in accordance with applicable provisions of the Tariff and Customs Code of the Philippines and other related laws.

Implementing Rules and Regulations (Section 10):
- Within sixty (60) days from the approval of this Act, the Department of Finance, the Bureau of Customs, the Department of Trade and Industry, the Bureau of Immigration, and all Port Authorities, shall promulgate such rules and regulations necessary for the effective implementation of this Act.

Separability Clause (Section 11):
- If any provision of this Act is subsequently declared invalid or unconstitutional, other provisions hereof which are not affected thereby shall remain in full force and effect.

Repealing Clause (Section 12):
- Section 1009 of Presidential Decree No. 1464, otherwise known as the "Tariff and Customs Code of 1978" and all laws, decrees, orders, rules and regulations, and other issuances, or parts thereof, inconsistent with the provisions of this Act are hereby repealed or modified accordingly.

Effectivity (Section 13):
- This Act shall take effect fifteen (15) days after its publication in the Official Gazette or in a newspaper of general circulation.