Subic cargo operators question SBMA’s port fee increases

Long-time cargo operators at the Subic Bay Freeport Zone questioned the recent resolution of the Subic Bay Metropolitan Authority (SBMA) approving tariff hikes in Subic ports in favor of the joint venture it formed with Harbour Centre Port Terminal Inc. (HCPTI).

SBMA passed Resolution Number 10-02-35-35 last February 19, 2010 approving additional provisions in the proposed JVA with HCPTI.

The first additional provision is the tariff adjustment clause “giving the operator flexibility to adjust tariff rates, provided that: (a) the tariff adjustment will in no case exceed 95% of the Philippine Port Authority-approved tariffs in the port of Manila; (b) the rate adjustment shall not exceed twice in one year; and (c) the rate adjustment can only take effect with a 30-day notice to SBMA and the public in general.

Atty. Eulalio Ventura , legal counsel of Amerasia International Services Inc. and other cargo operators said, at the hearing conducted by the SBMA board, that the high tariff is only one of the many legal flaws of the SBMA-HCPTI joint venture.

As this developed, Ventura said they will also proceed with the filing of criminal complaint against the SBMA board next week.

"Next week we shall be filing a criminal case for the crimes defined in Sec. 3 of the Anti-Graft and Corrupt Practices Act and in Article 186 of the Revised Penal Code against those who approved the SBMA-HCPTI contract by affixing their signatures in the pertinent board resolutions and the contract itself," he said.

He said locators/cargo handling operators were granted authority to increase tariff rates by 25 percent about four years ago, but it was never implemented.

According to Ventura , the approval of the tariff hike, "Would give HCPTI an annual revenue/income of P300 million. HCPTI can give you P50 million annually and they will still make good money out of the tariff income."

Under the agreement, HCPTI shall be SBMA’s exclusive cargo handler of bulk (excluding fertilizer), break-bulk and general cargo for a period of 25 years.

He said the contract, which granted monopoly to HCPTI, violated Section 1 of the Bill of Rights of the 1987 Philippine Constitution which states that no person shall be deprived of property without due process of law.

It also violated Section 19, Article XII of the National Economy and Patrimony of the Constitution which states that the State shall regulate or prohibit monopolies when public interest requires, he said.

In addition, Ventura pointed out that Amerasia had 14 years of cargo handling experience at the Freeport and had a strong performance record.

Meantime, SBMA administrator Armand C. Arreza has maintained that they have been transparent in forming the joint venture with HCPTI and followed the approved guidelines for joint venture agreements. They also invited the existing port operators but it turned out that the offers of Amerasia and Mega Equipment International Corp. (MEIC) were inferior to HCPTI’s offer.

“We follow the guidelines of the joint venture and we invited all the parties involved including the Subic operators, Philexport, Commission on Audit and the National Economic and Development Authority, so we are confident,” he said.

“If Amerasia really feels they are aggrieved, then by all means they should file a case in court,” Arreza said.

“Foremost, from a commercial point, the HCPTI’s unsolicited proposal is most advantageous to SBMA. The offer of Mega Equipment International Corp. (MEIC) and Amerasia was a lot inferior,” Arreza stressed.

Based on the negotiated terms reached with HCPTI and SBMA, the Reghis Romero-owned company has agreed to a $32 million or equivalent to P1.5 billion fixed and guaranteed revenue share over a 25-year joint venture period.

HCPTI has also agreed to a 15 percent share of cargo handling revenues generated from cargo volumes in excess of 2 million metric tons or an approximate 25 year total income of P197.74 million for SBMA. This share increases to 16 t 17 percent based on actual volume. By BERNIE CAHILES-MAGKILAT - mb.com.ph