90 OG No. 37, 5373 (September 12, 1994)
WHEREAS, Section 19, Article XII of the
Constitution declares that "State shall regulate or prohibit monopolies
when the public interest so requires. No combinations in restraint of
trade or unfair competition shall be allowed;"
WHEREAS, Presidential Decree No. 474, otherwise known as the Maritime Industry Decree of 1974, provides that:
"It
is hereby declared the policy of the State to accelerate the integrated
development of the maritime industry of the Philippines to attain the
following objectives: (a) To increase production and productivity in the
various islands and regions of the archipelago through the provision of
effective sea linkage; (b) To provide for the economical, safe,
adequate and efficient shipment of raw materials, products, commodities
and people; (c) To enhance the competitive position of Philippine flag
vessel in the carriage of foreign trade; (d) To strengthen the balance
of payment position by minimizing the outflow of foreign exchange and
increasing dollar earnings; (e) To generate new and more job
opportunities;"
WHEREAS, Presidential Decree No. 474
likewise states that to attain the foregoing objectives, the
Government, through the Maritime Industry Authority (MARINA), shall:
"(a)
Adopt and implement a practicable and coordinated Maritime Industry
Development Program which shall include, among others, the early
replacement of obsolescent and uneconomic vessels; modernization and
expansion of the Philippine merchant fleet, enhancement of domestic
capability for shipbuilding, repair and maintenance; and the
development of reservoir of trained manpower;
(b) Provide and
help provide the necesary: (i) financial assistance to the industry
through public and private financial institutions and instrumentalities;
(ii) technological assistance; and (iii) in general, a favorable
climate for expansion of domestic and foreign investments in shipping
enterprises; and
(c) Provide for the effective supervision,
regulation and rationalization of the organizational management,
ownership and operations of all water transport utilities, and other
maritime enterprises."
WHEREAS, the growth of the
national economy on a sustained basis requires an efficient water
transport industry to ferry passengers and cargo at reasonable and
competitive rates.
NOW, THEREFORE, I, FIDEL V. RAMOS. President
of the Republic of the Philippines, by virtue of the powers in me by
law, do hereby order:
1. The entry of new operators into the
domestic water transport industry shall be liberalized to enhance the
level of competition and bring about reasonable rates and improved
quality of services.
1.1.
Opening-up of All Routes
-Public Interest and public convenience call for the levelling of the
playing field for all existing and new operators in the domestic water
transport industry. Competition, provided it is not ruinous, should be
the norm to open-up the industry to new investments and to stimulate
further economic activity.
1.1.1 | All
routes/links shall have a minimum of two (2) operators. Routes/links
presently serviced by only one (1) operator, or monopolized or
cartelized as determined by MARINA, shall be open for entry to
additional operators. |
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1.1.2 | All
routes/links which have been serviced by any operator for an aggregate
period of at least five (5) years shall be open for entry to additional
operators without limit |
1.2.
Encouraging Entry Into Developmental Routes
- The entry of operators In developmental routes as determined by
MARINA shall be encouraged. An operator who pioneers In the provision of
a certain technological level/ type of shipping service in a
developmental route shall be authorized to charge market-accepted
freight and passage rates differing from the authorized fork-tariff, if
availed of; Provided, that the operator shall apply with MARINA for the
adjustment in or adoption of such rates, the approval of which shall be
accordingly granted; and Provided, further, that after five (5) years of
such operation, the continued authorization of such rates, or
adjustments thereof, shall be dependent on an evaluation undertaken by
MARINA
1.3
Deregulating Entry of Newly-Acquired Vessels Into Routes Already Served By Franchised Operators1.3.1
An existing or new operator who acquires a vessel through importation,
bareboat charter with option to purchase, lease-purchase, or local
construction, shall be granted a Certificate of Public Convenience
(CPC)/Provislonal Authority (PA) and allowed to operate such vessel in
any route, even if already being served by existing franchised operators
for less than five (5) years, including developmental routes; Provided,
that the prescribed application for CPC has been filed, and the basic
requisites prior to issuance thereof have been complied with; Provided,
further, that upon filing of the application for CPC, the presumption of
public need shall be accorded in favor of the applicant, especially but
not necessarily when any of the following conditions shall be shown to
obtain:
1.3.1.1 | The
proposed operation shall introduce innovative,
technologically-advanced, or pioneering shipping services in the route
applied for, such as, but not limited to, the deployment of fast
ferries, cruise vessels, container vessels and RoRo vessels, or the
employment of modern and efficient on-board cargo handling equipment as
an integral part of the vessel's operation. |
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1.3.1.2 | The proposed operation shall introduce improvements in the quality of service being provided in the applied route/ link; |
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1.3.1.3 | The
vessel proposed to be deployed shall serve as an improvement over the
existing vessels operating therein, either in terms of the vessel's age,
size, capacity, hull material and other vessel technical features; |
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1.3.1.4 | The proposed operation shall foster cost-effective competitive shipping service in the route proposed to be served; |
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1.3.1.5 | The
proposed operation shall service priority tourist links as identified
by the Department of Tourism in its Tourism Master Plan; |
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1.3.1.6. | The
route/link applied for warrants additional operators/services, as
determined by MARINA or by pertinent local government units, resulting
in public invitations for additional services therein. |
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condition covers cases where there is a duly verified and legitimate
public clamor for additional shipping services and it has been
determined that existing authorized operators in the route/link have not
been sensitive to an increase in demand by offering to increase
capacity only after another operator has offered to provide additional
services therein; and |
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1.3.1.7. | Where existing authorized operators have abandoned their operations in a given route. |
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| Any oppositor to the application shall bear the burden of proving that there is no need for the proposed service. |
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| Provided, finally, that the vessel, upon issuance of the CPC, shall continuously serve its franchised route for at least one (1) year. |
1.4
Vessel Rerouting or Amendment of Authorized Route And Change In Sailing Schedules and FrequencyAny
change or amendment to the authorized routing pattern of a vessel can
be undertaken by an existing authorized operator thru the following: (1)
ommission or deletion of port(s); (2) addition of other portfs); (3)
omission and subsequent addition of port(s); (4) changing the sequence
of port calls; (5) retention of authorized routing pattern but with
addition of one or more ports. Vacated port(s) or link(s)/ route(s) as a
result of the above shall be looked into by MARINA insofar as adequacy
or sufficiency of the remaining existing shipping services is concerned:
1.4.1.
Approval shall be granted to applications for any of the above forms of
change or amendment of authorized routing pattern by existing
franchised liner vessels, Provided, that:
1.4.1.1. | No
conflict in sailing schedules with other affected operators in the
applied route/link shall result therefrom, otherwise, the MARINA shall
prescribe, motu proprio, sailing schedules that will best serve public interest and convenience; |
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1.4.1.2. | No
route or link shall be left unserviced by the rerouting or route
amendment, unless a substitute vessel from the applicant will be
deployed therein, or vessel(s) from other existing authorized operators
are left serving the route/link; and |
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1.4.1.3. | Shipping
service in the previous route/ link has been continuously rendered by
the vessel for at least one (1) year from Issuance of CPC. |
1.4.2
If the rerouting or route amendment of a vessel is caused by the
deployment of a newly acquired vessel (either through Importation,
bareboat charter with option to purchase, lease purchase or local
construction) into the authorized route of an operator, the policy of
liberalized entry into any route under Section1.3 above shall be
applied.
1.4.3 If no newly-acquired vessel is involved and an
application is filed for the rerouting or route amendment of a vessel,
where an entirely new route or link will be served, a new application
for CPC shall be filed and entry therein will depend on whether any of
the conditions or circumstances enumerated in Section 1.3- above has
been proven to obtain. Priority shall, however, be given to
newly-acquired vessels brought into the fleet, subject to Section 1.3,
in the grant of CPC to a given route.
1.4.4 In cases where only a
temporary authority has so far been issued to a vessel, pending
resolution of the basic application for CPC, an application for
amendment of route or rerouting may be filed and considered by the
MARINA, but the amended authority to be issued as result thereof, shall
be subject to the one (1) year maximum period per issuance to be
cumulatively reckoned from the first PA issued In the original
application.
2. All government departments, offices, agencies,
or instrumentalities, including government-owned or controlled
corporations, such as the Board of Investments, Bureau of Customs,
Bureau of Fisheries and Aquatic Resources, Bureau of Plant Industry,
Bureau of Animal Industry, National Quarantine Office, Philippine Navy,
and the Philippine National Police, are hereby ordered to assist and
coordinate with MARINA in the implementation of this Executive Order.
3.
This Executive Order revokes or amends all executive, department and
other agency issuances or any provision thereof inconsistent with this
Executive Order. The MARINA is hereby directed to Issue rules and
regulations to Implement this Executive Order.
4. This Executive Order shall take effect fifteen (15) days after its publication once in a newspaper of general circulation.
Adopted: 28 June 1994
(Sgd) FIDEL V. RAMOS
President