1 
Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
Third Regular Session  
House Bill. No. 10651
Introduced by Representative KHYMER ADAN T. OLASO 
EXPLANATORY NOTE 
The Philippine Ship Registry System Act aims to enhance the Philippines' status as a leading 
maritime nation. By improving the ship registry system, the Act seeks to establish the country 
as a respected flag State, thereby increasing its influence and reputation in international 
maritime affairs. It mandates that Filipino-owned and manned fleets meet global standards for 
reliability, safety, competitiveness, and effectiveness, thereby improving maritime operations 
and ensuring the welfare of Filipino seafarers. Furthermore, the Act provides measures to 
protect the merchant marine fleets, essential for the country's economy, and to support their 
role in expanding Philippine international trade. 
To maintain a competitive edge, the Act encourages vessel acquisition, development, 
modernization, and expansion through systemized and sustainable programs. These initiatives 
ensure continuous growth and advancement of the nation’s maritime capabilities. The Act also 
aims to attract more ship owners to register under the Philippine flag by creating favorable 
registration policies, which will contribute to economic growth through increased maritime 
activity and associated revenues. Additionally, it proposes aligning the tax structure for 
domestic and overseas shipping fleets with global standards, making the Philippines a more 
attractive hub for maritime operations. 
Recognizing the importance of maintaining high standards of maritime safety and security, the 
Act establishes mechanisms for the early adoption and implementation of international 
maritime regulations and conventions. This proactive approach ensures that the Philippine 
maritime industry remains compliant with international standards and best practices. Overall, 
the Philippine Ship Registry System Act is a comprehensive legislative measure designed to 
transform the Philippines into a leading maritime nation, supporting the growth of the maritime 
industry and aligning the country’s practices with global standards. 
KHYMER ADAN T. OLASO
July 29, 2024
8:00 am


Republic of the Philippines  
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
Third Regular Session  
House Bill. No.  10651
Introduced by Representative KHYMER ADAN T. OLASO 
AN ACT ESTABLISHING THE SCOPE AND PROCEDURE FOR 
PHILIPPINE SHIP REGISTRY, RECOGNITION AND ENFORCEMENT OF 
MARITIME CLAIMS, AND LIMITATIONS OF LIABILITY, AS WELL AS 
PROVIDING ESSENTIAL INCENTIVES, WHICH COLLECTIVELY WILL 
PROMOTE A COMPREHENSIVE AND ORDERLY PHILIPPINE SHIP 
REGISTRY 
SYSTEM 
FOR 
THE 
REGULATION 
OF 
VESSELS 
CARRYING THE  FLAG  STATE 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
TITLE I. GENERAL PROVISIONS 
CHAPTER I POLICIES 
SECTION 1. Short Title. - This Act shall be known as the "Philippine Ship 
Registry System Act." 
SECTION 2. Declaration of Policy. - It is the policy of the State: 
a. To establish the Philippines as a leading maritime nation and respected flag
State;
b. To ensure that Filipino-owned-and-manned maritime fleets or vessels are
strengthened and assisted to meet the minimum global standards for
reliability, safety, competitiveness, and effectiveness;
c. To provide protection to our merchant marine fleets, and help expand
Philippine international trade;
d. To encourage Philippine vessel acquisition, development, modernization,
and expansion through systemized and sustainable programs;


e. To provide policies that will attract more ship owners to register under 
Philippine flag, thus ensuring the country's economic growth; 
f. To align the tax structure for its domestic and overseas shipping fleet to make 
it competitive; and, 
g. To provide a mechanism for the early adoption and implementation of 
international maritime regulations and conventions. 
SECTION 3. Implementing Agency. - The Maritime Industry Authority 
(MARINA) shall be the implementing agency of this Act. The MARINA shall 
provide secretariat support in the enforcement of this Act. 
CHAPTER II. DEFINITION OF TERMS 
SECTION 4. Definition of Terms. - As used in this Act: 
a. Arrest refers to the attachment of a vessel by judicial process through an 
order of a competent court in order to secure the enforcement of a maritime 
claim, which attachment shall produce the effect of detaining or restricting 
the removal of a ship in execution or satisfaction of a judgment; 
b.  Bareboat charter refers to a contract for the lease of a ship, for a stipulated 
period of time, by virtue of which the bareboat charterer has complete 
possession and control of the ship, including the right to appoint the master 
and crew of the ship, for the duration of the lease; 
c.  Bareboat charterer or charterer may be used interchangeable and refers to 
any person, commercial partnership or corporation which bareboat charters 
a Philippine flag vessel from another Philippine national, or a vessel of 
compatible foreign registry, for its own use; 
d. Certificate of Philippine Registration refers to the document of registration of a 
vessel registered in accordance with Section 13 of this Act; 
e. Claimant refers to a person who asserts that a maritime claim exists in his 
favor; 
f. Court or Philippine court or competent court may be used interchangeably 
and refers to a court of appropriate jurisdiction within the territory of the 
Philippines; 
g.  De-registration refers to the act of deleting a ship from the Registry of Ships of 
the Philippines and the cancellation of the Certificate of Philippine registry in 
accordance with Section 21 of this Act; 
h. Foreign flag vessel refers to a ship which is registered under the laws of a 
country other than the Philippines and which is authorized to fly 


the flag of that country; 
1.  Foreign registry refers to the registry of ships of a country other than the 
Philippines; 
J. Maritime claim refers to any of the claims provided in this Act; 
k. Maritime lien refers to a charge that attaches to a ship which rises from a 
maritime claim against the ship, its owners, charterers, managers, or 
operators that results in a demand for indemnity or remuneration from the 
ship or its owners, charterers, managers, or operators, and is enforceable by 
judicial action; 
1.  Mortgagee refers to the person, whether natural or juridical, in whose favor a 
ship mortgage is created in order to secure a principal obligation; 
m.  Mortgagor refers to a ship owner who constitutes a ship mortgage over a 
vessel or a vessel under construction registered in its name in order to secure 
the fulfillment of a principal obligation; 
n. Philippine Flag Vessel refers to any vessel duly registered under Philippine 
Laws and authorized to fly the Philippine flag; 
o.  Philippine national refers to any individual who is a citizen of the 
Philippines, or a commercial partnership or corporation organized under the 
laws of the Philippines, at least 60% of the capital of which is owned by 
citizens of the Philippines; 
p.  Registration refers to the act of entering a ship in the Registry of Ships of the 
Philippines in accordance with this Act; 
q.  Register of Ships of the Philippines or Register or Registry may be used 
interchangeably and refers to the official public register maintained by the 
MARINA which shall hold the record of all vessels under Philippine laws; 
r. Record of Ship Mortgages and Encumbrances refers to the public record 
maintained by the MARINA containing all details of the vessel's mortgage and 
encumbrances; 
s. Seagoing vessel refers to any Philippine flag vessel of five hundred 
(500) gross tons or more, authorized to carry passengers or cargo, or both, 
in trade between a Philippine port and a foreign port, or between two foreign 
ports; 
t.  Ship manager refers to any person, commercial partnership or corporation 
to which the technical or commercial management, or both such technical 
and commercial management, of a ship has been entrusted by the ship owner 
and for that purpose is in charge of the operation of the ship which may 
include vessel maintenance and 


upkeep, crewing and passenger and cargo solicitations; 
u. Ship mortgage refers to a contract executed by the owner of a ship creating 
a security interest over a particular vessel or a vessel under construction m 
order to secure the performance of a principal obligation; 
v. Ship owner refers to any person, commercial partnership, or corporation 
authorized to own, operate, manage, control, lease, or charter out, or 
otherwise engage in the business of shipping; 
w. Ship operator refers to any person, commercial partnership, or corporation 
authorized to operate, manage, or control a ship owned by another; 
x. Tonnage or Gross tonnage may be used interchangeably unless otherwise 
indicated and refers to the ship's gross tonnage calculated in accordance with 
the tonnage measurement rules provided in the applicable international 
convention on the tonnage measurement of ships; 
y. Unit of Account refers to the Special Drawing Rights (SDR) as defined by the 
International Monetary Fund (IMF). The SDR is an international reserve 
asset, created by the IMF in 1969 to supplement its member countries' 
official reserves; 
z. Vessel or ship may be used interchangeably and refers to any boat, craft, or 
artificial contrivance of floating in water, designed to be used, or capable of 
being used, as a means of water transport for the carriage of passengers or 
cargo, or both, utilizing its own motive power or that of another, and shall 
include a ship under construction and for purposes of this Act shall continue 
to be considered as personal property. It excludes fishing vessels defined and 
regulated under existing laws and bancas, sailboats, and other water-borne 
contrivance of less than three (3) gross tons and not motorized: Provided, 
That this does not include those owned and/or operated by the Armed Forces 
of the Philippines (AFP) and by foreign governments for military purposes: 
Provided further, That mobile offshore platforms used in petroleum 
exploration and development, such as mobile offshore drilling units and 
offshore production platforms, shall be considered as ships when they are 
mobile and not affixed to the seabed. 
TITLE II. SHIP REGISTRY 
SECTION 5. The Philippine Ship Registry. - The Philippine Ship Registry, 
hereinafter referred to as the "Registry," is hereby established, through which the 
State confers nationality, exercises its jurisdiction, protects


and enforces private rights, and undertakes the national and international responsibilities of a 
flag State, over all ships flying the Philippine flag. 
The Registry is comprised of the Register of Ships and the Record of Ship 
Mortgages and Encumbrances. It shall be maintained by the MARINA in accordance 
with the provisions of this Act, and the rules and regulations that may be issued 
pursuant thereto. There shall be one Registry for all domestic and international flag 
vessels. 
 
CHAPTER III. REGISTRATION OF SHIPS 
SECTION 6. Register of Ships. - A Register of Ships shall be kept and 
maintained by the MARINA, which shall record essential ship information, 
including the following: 
a. Name of vessel; 
b. Keel number; 
c. Hull material; 
d. Principal dimensions; 
e. Gross tonnage; 
f. Net tonnage; 
g. IMO number; 
h. Official number; 
1. Place of build; 
J. Year of build; 
k. Name and address of registered owner, ship operator, bareboat charterer, 
manager, or other person responsible for the ship; 
I. Date of issuance of CPR; 
m. Class of vessel; 
n. A reference that encumbrances on the vessel appear in the primary registry. 
In the case of second hand tonnage, the following additional data shall 
likewise be listed in the Registry of Ships: 
o. Place of previous registry; 
p. Name of previous owner. 
In the case of bareboat chartered vessels, the following additional data shall 
also be listed in the Registry of Ships: 
q. Place of primary registry; 
r. Name of registered owner appearing in the primary registry; 
s. Name of the vessel as it appears in the primary registry; 
t. A reference that encumbrances on the vessel appear in the primary registry; 
u. Any material change of condition with respect to any of the preceding items 
and any other fact required by regulation shall likewise be recorded in the 
Registry of Ships. 


The MARINA may add to the required information to be submitted in 
accordance with international standards. 
SECTION 7. Effect of Registration. - Any ship registered under the Philippine 
registry shall be entitled to the following: 
a. Conferment of the nationality and status of a Philippine ship; 
b. Entitlement to the protection of the Philippine flag; 
c. Entitlement to the right to invoke the diplomatic, consular, and naval 
protection of Philippine authorities and the protection of the flag of the 
Philippines; 
d. Imposition of the duty to fly the Philippine flag; 
e. Obligation to abide by all applicable laws, decrees, orders, rules, and regulations 
of the Philippines; 
f.  Entitlement to the privilege to engage, consistently with the limitations 
provided by law, in Philippine coastwise trade in accordance with corollary 
permits, certificates and franchises that may be issued to the vessel; and 
g.  Entitlement to the right to invoke the exercise of jurisdiction and control by 
Philippine government authorities over all persons found on board the vessel, 
or over any incident involving the penal or disciplinary responsibility of the 
master or any member of the crew whether the same arises from a crime or 
quasi-delict committed on board the vessel or from any collision or other 
incident of navigation concerning the ship. 
SECTION 8. One Ship, One Registry Rule. - A ship may be registered with 
only one ship register at any one time. Before entering the ship in the Register, 
the MARINA shall ensure that any previous registration has been deleted, or 
that the ship has been de-registered from any foreign registry. 
In the case of a foreign flag ship under bareboat charter, the MARINA shall 
ensure that the right to fly the flag of the former flag State is suspended for the 
duration of its previous registration and nationality under the former flag State, 
and indicating the particulars of any registered encumbrances entered in the 
previous registry. 
It is the duty of the owner, master, or agent of every ship in the Register to inform 
the MARINA of any change in the facts pertaining to the ship and entered 
therein. 


SECTION 9. Who may register. - 
a. All ships operating within the maritime territory and jurisdiction of the 
Philippines, except transient foreign flag ships subject to such regulations as 
the MARINA may prescribe, are mandated to be registered with the 
Philippine registry: Provided, That they meet the conditions for the grant of 
registration imposed by this Act and the regulations pursuant hereto. This 
mandatory registration under the Philippine Flag is particularly required in 
the following cases: 
1. The ship is five hundred (500) gross tons or more; 
2. The ship is owned by a qualified person, as may be determined by the 
MARINA; 
3. The ship meets the requirements for safety, security, marine 
environmental protection, crew nationality, training, certification, and 
competency, and crew welfare. 
b. Any other ship, including a foreign-owned ship, may also be registered in 
accordance with this Act, provided the following conditions are present: 
1. It is used only in international voyages; 
2. It is managed by a qualified person residing in the Philippines, as may be 
determined by the MARINA; 
3. It complies with the applicable provisions that govern the safety and 
security of Philippine ships and persons on board; 
4. It complies with the applicable provisions that govern the terms and 
conditions of employment on board Philippine flag vessels; and, 
5. The ship employs full Filipino crew, unless otherwise authorized by the 
MARINA, consistent with applicable treaties, conventions, and 
internationally-accepted maritime and labor standards and practices; 
Provided, however, That any exemption granted by the MARINA must 
still require that at least majority of the crew of the seagoing vessel are 
Filipinos. 
6. Additional incentives for payment of tax tonnage, under Section hereof, 
shall be granted to the registered foreign-owned vessel where the ship 
owner, manager, operator, or bareboat charterer and all its crew officers, 
and employees have a valid, subsisting and duly implemented collective 
bargaining agreement that conforms to international labor standards, 
rules and conventions. 
c. Vessels of a foreign registry that are covered by a bareboat charter may be 
registered under the Philippine flag: Provided, That their registration under 
the foreign flag of primary registration shall not be 


abandoned, but shall be deemed suspended, for the duration of the ship's 
registration under the Philippine flag. 
SECTION 10. Licensure. - Every ship, regardless of size, intended to be 
used in the carriage of passengers or cargo, or both, between ports and places, 
in the coastal, internal, inland or sheltered waters of the Philippines, shall be 
covered by a license to operate: Provided, That such ship is owned by a 
citizen of the Philippines or a corporation or association organized under the 
laws of the Philippines at least sixty percent (60%) of whose capital is owned 
by such citizens and the ship meets the other conditions for the grant of the 
license imposed by this Act and the regulations pursuant hereto. 
SECTION 11. Conditions for Registration. - No ship shall be registered 
unless the following conditions are present, as determined by the MARINA 
in accordance with this Act and regulations issued related thereto: 
a.  Proof of Ownership. - There must be satisfactory proof of ownership 
and/or management by qualified persons. 
b. Seaworthiness. - A ship must comply with the general requirements for 
age, safety, security, navigation, manning, and protection and 
preservation of the marine environment in accordance with national and 
international standards for ships. 
c.  Manning. - A ship must be manned by a crew with such level of skills 
and competencies as may be necessary in accordance with applicable 
international maritime conventions, rules, and standards as well as 
national law and regulations. 
d.  Labor and social conditions. - A ship must meet the labor and social 
standards required by applicable international labor conventions, rules 
and standards as implemented by the MARINA. 
e.  Management. - A ship must be managed by a person or entity that is under 
the effective jurisdiction of the State. 
f. Payment of fees and dues. - The applicant for ship registration must pay 
the corresponding registration fees and tonnage dues as may be imposed 
by the State. 
SECTION 12. Documentary Requirements. - Every ship owner, master or 
agent who opts to enroll a vessel for registry under the Philippine flag shall 
submit to the MARINA the following documents: 
a. A written application for registration; 
b. A documentary proof of ownership over the vessel; 
c. Proof of authority to enroll the ship for registry, if applicable; 


d. A copy of a certification issued by a classification society showing the ship 
is of a certain class, if existing and applicable; and 
e. Such other necessary documents that may be required by the MARINA 
in accordance with the best international shipping practices or standards. 
SECTION 13. Issuance of Certificate of Philippine Registration. - No 
application for a Certificate of Philippine Registration shall be approved and 
issued until the MARINA has made the proper evaluation that all the 
conditions and documents required and mandated for registration under this 
Act or regulations issued hereto have been complied with. The MARINA or its 
deputized representative shall inspect the vessel and all its documents and 
ensure that it is qualified for registration under this Act. 
A certificate of Philippine registry shall be valid for a period of no more than 
three (3) years, and may be continuously renewed for a similar period: 
Provided, That all the requirements for registration or its renewal are met. In 
case of a bareboat chartered vessel, the Certificate of Philippine Registration 
shall be valid for a period of no more than three (3) years or the period of the 
bareboat charter, whichever is shorter. 
SECTION 14. Types of Registration. - Registration of a ship may be permanent, 
provisional, or temporary in nature. 
a.  Permanent Registration. - Except as provided in the succeeding 
sections, the registration of a ship and issuance of a Certificate of 
Philippine Registration is deemed to be permanent until the ship is 
actually de-registered or deleted from the Register. 
b.  Provisional Registration. - Ship constructed and/or acquired abroad, 
before being brought to the Philippines, may be issued a Provisional 
Certificate of Philippine Registration and a provisional tonnage 
certificate for conduction purposes. 
c. Temporary Registration. - 
The following may be issued a Temporary Certificate of Philippine Registration: 
1. Any ship about to be built, or under construction in the Philippines; 
2. Any ship owned and/or operated by an entity duly registered with the 
Board of Investments (BOI) under pertinent investment laws, rules and 
regulations, to be used exclusively for the purpose of transporting raw 
materials and/or finished products within Philippine waters as an 
essential element and operation in the manufacturing, processing, or 
other business activity or project registered by such entity with the BOI: 
Provided, That such temporary registration applies only for the 
duration of such 


business activity or project, and shall not exceed one (1) year, renewable 
for another year: Provided, further, That the type of ship used or service 
undertaken cannot be provided by a Philippine shipowner; 
3. Any ship that is operated and managed under a bareboat charter: 
Provided, That in case of a foreign flag vessel bareboat-chartered by a 
qualified person for operation in Philippine waters, the ship may be 
temporarily registered with the Registry for the duration of the charter: 
Provided further, That for the duration of temporary registration with 
the Philippines, any registration with a foreign flag State is suspended: 
Provided, finally, That no ship under a bareboat charter shall be 
registered if, after the effectivity of its charter, has undergone extensive 
structural 
modification 
in a manner that affects its safety and 
seaworthiness. 
SECTION 15. Markings, Name, and Homeport. - All ships duly 
registered according to the provisions of this Act shall have their 
respective names plainly marked upon each side of the bow and stern; and 
the homeport and International Maritime Organization (IMO) number 
upon the stern. 
SECTION 16. Change in Ownership of Ships. - In case of a sale of a 
Philippine-flagged ship, the transferee shall present the bill of sale or other 
certificate evidencing the transfer of ownership to the MARINA within fifteen 
(15) days after its execution for appropriate recording in the Register. 
SECTION 17. Correction of Errors in the Registry. - Errors in recording 
made in the Register shall be corrected in the following manner: 
a. Mere clerical errors without any effect on the meaning and substance 
of the document shall be corrected by the appropriate and designated 
officer of the MARINA who shall make the necessary correction; 
b. Any mistake or error that might affect the meaning and substance of the 
documents shall be corrected by order of the MARINA after notice to, 
and hearing of, the interested parties. 
SECTION 18. Reconstitution of Lost Certificate. - If the Certificate of 
Philippine Registration of a ship is lost or damaged, the owner, master, or 
agent thereof may file an application with the MARINA for the issuance of a 
replacement certificate. The replacement certificate shall indicate that the 
original certificate is considered cancelled and revoked. If after the 
issuance of the replacement certificate, the lost original certificate of 
Philippine registry is found, it shall be the duty of the owner, master, agent, 
or any person having possession of the original certificate to surrender it 
to the MARINA. 


SECTION 19. Suspension, Cancellation, or Revocation of Ship 
Registration. - The registration of a Philippine flag vessel shall be 
cancelled and its corresponding Certificate of Philippine Registration shall 
be revoked in any of the following cases: 
a. The Certificate of Philippine Registration was illegally or fraudulently 
obtained; 
b. The ship is sold, transferred, and/or assigned to a person not qualified 
to register ships in the Philippines under the provisions of this Title or 
as may be determined by the MARINA; 
c.  In the case of a transfer of ownership over the ship, the new transferee 
or assignee has properly applied for change of ownership and/or 
registration; 
d. The ship is sold by the order of a competent court; 
e. The ship is sold for scrapping; 
f. The ship is determined by the MARINA to be unsafe and unserviceable 
beyond repair; 
g. The bareboat charter of the ship has expired, or has been cancelled or 
terminated for any reason, in which case, the cancellation from the 
register of ships and revocation of the certificate of Philippine registry 
shall be automatic; 
h. The ship has been declared lost or missing pursuant to a written and 
notarized notice submitted by the owner, master, or agent of a 
Philippine flag vessel to the MARINA, containing advice of such loss and 
the probable cause thereof; 
1. Gross violations of the safety, security, environment, and other 
standards or requirements set by the MARINA; 
J. The ship owner, manager, agent, or bareboat charterer is proven to have 
given or submitted to the MARINA fabricated information or 
fraudulent documents relative to the registration or settlement of their 
fees or taxes; 
k. The ship has engaged in illegal activities; 
I. The ship owner, manager, or bareboat charterer commits any acts 
inimical to the national security or national interest of the Philippines; 
m. The ship is entered in a foreign registry without prior approval of the 
MARINA. 


SECTION 20. Inspection of the Register. - The Register of Ships shall be 
open to public inspection during ordinary business hours, in the offices of 
MARINA, and online. All documents and information provided in 
connection with the registration of a ship are considered public documents. 
Upon request and payment of reasonable fees, authenticated copies of any 
document or instrument required to be filed under this Act, including 
pertinent rules and regulations, or extracts thereof, shall be furnished to 
any person. 
SECTION 21. De-registration of Ships. - A ship which is or has been 
registered in another State shall not be eligible for permanent registration 
in the Philippines, unless: 
a. A certificate has been issued by the former flag State to the effect that 
the ship has been de-registered; or 
b. A certificate has been issued by the former flag State to the effect that 
the ship will be de-registered on the day when such new registration is 
effected. 
Except in the case of forced sales, a Philippine-flagged vessel shall not be 
de-registered without the written consent of all holders of registered 
mortgages. 
If the de-registration of the vessel is obligatory in accordance with this 
section, all holders of registered mortgages shall be notified by the 
MARINA of the pending de-registration in order to enable such holders to 
take appropriate action to protect their respective interests. 
If the consent of the holders is not obtained, de-registration shall not be 
implemented earlier than three (3) months after notice to such holders of 
registered mortgages is given. 
 
CHAPTER IV 
TAXES AND FEES 
SECTION 22. Processing Fee. - A processing fee shall be paid by the 
owner, master, or agent of ship sought to be registered when the 
application for registration or when a renewal thereof is filed. The 
processing fee shall be collected to cover administrative costs for handling 
and processing the application. The processing fee shall be in such 
reasonable amount as may be determined by the MARINA. 
SECTION 23. Registration Fee. - A registration fee shall be payable by 
the ship owner, master, or agent when the ship is first entered in the 
Registry and shall be paid when the Certificate of Philippine Registration 
is issued. The registration fee shall be fixed in such reasonable amount as 
determined by the MARINA. 
SECTION 24. Tonnage Tax Fees. - An annual tonnage tax fee shall likewise 
be paid by the owner, manager, or bareboat charterer of the 


vessel for the issuance and continued possession of a valid and subsisting 
certificate of Philippine registration. The annual tonnage tax fee shall be 
computed at the rate of US$0.10 per net register tonnage or its equivalent in 
Philippine Peso based on the present or latest exchange rate posted by the 
Bangko Sentral ng Pilipinas (BSP) on the date of payment of such tonnage tax 
fees. The ship owner, master, or agent shall have the option whether to pay in 
US dollars or in Philippine Peso. 
For all vessels, if the owner, manager, or agent has satisfactorily established 
with the MARINA compliance with the conditions stated in Section 9, 
paragraph b, subsection 6 hereof, they shall enjoy an additional incentive. In 
such case, the tonnage tax fees due from them shall be reduced to the rate of 
US$o.o8 per net register tonnage or its equivalent in Philippine Peso based on 
the present or latest exchange rate posted by the BSP on the date of payment 
of the tonnage tax fees: Provided, That if the MARINA determines that the 
conditions for the additional incentive is violated or proof shown for its 
existence is fabricated, the Certificate of Philippine Registration may be 
revoked in accordance with Section 19, paragraph g hereof. 
SECTION 25. Adjustments in Fees and Taxes. - The MARINA may review the 
rates for the processing fee, registration fee, and tonnage tax fees from time to 
time, and with the approval of the Department of Transportation (DOTr), may, 
by regulation, adjust or increase various fees, but for a reasonable amount. 
SECTION 26. Exemption from Duties and Taxes. - The importation by the 
owner, manager, agent, or bareboat charterer of a vessel, and the spare parts, 
steel/metal plates, and equipment needed for the refurbishing, repair, and 
maintenance of such vessel shall be exempt from the payment of import duties 
and taxes, value added taxes, and all other pertinent taxes. 
In the case of a registered vessel, the annual tonnage tax fees shall be in lieu 
of any income tax due from the ship owner, manager, agent, or bareboat 
charterer and the withholding tax due on the lease or bareboat charter fees earned 
by the ship owner. Likewise, all crewing personnel of the registered foreign-
owned vessel shall be exempt from income tax and all other taxes that may be 
imposed on their salaries and remuneration received by reason of or in 
connection with their employment with the ship owner, manager, or bareboat 
charterer of the registered foreign-owned vessel. 
CHAPTER V 
RECORD OF SHIP MORTGAGES AND ENCUMBRANCES 
SECTION 27. Record of Ship Mortgages and Encumbrances. - MARINA shall 
maintain a Record of Ship Mortgages and Encumbrances containing the details 
and documents regarding all transfers, mortgages, encumbrances, or other 
documents proving or affecting the title to any ship registered in the Register 
of Ships. All documents, certificates, 


receipts, or acknowledgments cancelling or satisfying any such obligation in 
whole or in part shall likewise be recorded. The date and time of recording shall 
be expressly stated. 
SECTION 28. Effect of Recording. - In order to be valid and enforceable, or 
other right over a Philippine flag vessel, whether permanent or temporary in 
nature, in favor of a person other than registered ship-owner or his agent, must 
be entered into the Record. Priority in time of recording determines the priority 
in rights between different rights-holders. 
SECTION 29. Requirements of Recording. - A ship mortgage, encumbrance, 
or other rights shall be entered into the Record upon submission to the MARINA 
of the following: 
a. A copy of the contract or other instrument evidencing such mortgage, 
encumbrance, or other rights, which contain all the essential details 
thereof; 
b. A copy of the Certificate of Philippine Registration; 
c. In case of a ship under construction, a copy of its Temporary Certificate 
of Philippine Registration, or if such has not yet been issued, a 
declaration stating the ship's name, the location of the shipyard, the 
yard number, and the dimensions, and appropriate deadweight of the 
vessel upon completion. 
SECTION 30. Annotation of Mortgages and Encumbrances. - Upon request of 
the mortgagee, holder of the right, or his agent, and submission of the necessary 
documents required in this Act for recording, the MARINA shall cause the 
annotation of a ship mortgage, encumbrance, or other right on the back of the 
corresponding Certificate of Philippine Registry of the vessel concerned, 
referring to the entry number, date, and time of entry, and nature or subject 
matter of the document as contained in the Record. 
If a new or replacement certificate is issued, the annotations upon the 
previous certificate shall automatically be transferred and annotated upon the 
back of the new or replacement certificate. 
SECTION 31. Rights Over Vessels Under Construction. - Any right in respect to 
a vessel under construction in the Philippines may be entered and recorded after 
the keel has been laid or equivalent construction work has been performed. 
Vessels under construction contracted by a Philippine national may be registered 
in accordance with the provisions of this Act. In order that the vessel may be the 
subject of registration under this Act, it is necessary that the keel of the vessel 
must have been laid and a keel number assigned by the shipyard at the time of 
application. 


SECTION 32. Inspection of the Record. - The Record shall be open to public 
inspection during ordinary business hours in the offices of the MARINA and 
online. Upon request and payment of reasonable fees, extracts from the Record 
of Ship Mortgages and Other Rights, and/or authenticated copies of any 
document or instrument required to be filed under this Title and/or pertinent rules 
and regulations, or extracts thereof, shall be furnished to any person. 
 
TITLE III 
MARITIME LIENS AND ENCUMBRANCES 
CHAPTER VI 
MARITIME LIENS 
SECTION 33. Nature of Maritime Liens. - Maritime liens arise and are 
enforceable whether the claims secured by such liens are against the owner, or 
against the demise or other charterer, manager, or operator of the ship. Except 
in case of forced sale of the ship, the maritime liens shall be attached to the ship 
notwithstanding any change of ownership, registration, or flag. 
SECTION 34. Claims Secured by Maritime Liens. - The following claims, in 
relation to a ship, shall be secured by maritime liens on the ship: 
a. claims for wages and other sums due to the master, officers, and other 
members of the ship's complement in respect of their employment on 
the ship; 
b. claims in respect of loss of life or personal injury occurring, whether on 
land or on water, in direct connection with the operation of the ship; 
c. claims based on tort and not capable of being based on contract, in 
respect of loss or damage caused by the operation of the ship other than 
loss of or damage to cargo, containers, and passengers' effects carried 
on the ship; 
d. claims for port, canal, and other waterway dues, tonnage dues, light 
dues, pilotage dues, other public taxes, dues and charges of the same 
character; and 
e. claims relating to the salvage, wreck removal, and contribution in 
general average. 
SECTION 35. Claims Not Secured by Maritime Liens. - No maritime lien shall 
attach to a ship to secure claims for damages in connection with the carriage of 
oil or other hazardous or noxious substances by sea for which compensation is 
payable to the claimants pursuant to international conventions, local laws, 
or compulsory 


insurance, or those which arose out of or which resulted from the radioactive 
properties or a combination of radioactive properties with toxic, explosive, or 
other hazardous properties of nuclear fuel, or of radioactive produce or waste. 
SECTION 36. Priority of Maritime Liens. - The maritime liens set out in Section 
33 hereof shall take priority over registered mortgages, hypotheques, and 
charges. No other claims shall take priority over such maritime liens or over such 
mortgages, hypotheques, or charges except as may be specifically provided 
under this Act. The maritime liens set forth shall rank equally as between 
themselves. 
SECTION 37. Maritime Liens in case of Salvage, Wreck Removal, or General 
Average Acts. - Maritime liens securing claims for salvage, wreck removal and 
contribution to general average shall take priority over all other maritime liens 
which have attached to the ship prior to the time when the operations giving rise 
to the said liens were performed. 
Such liens shall rank in the inverse order of the time when the claims 
secured thereby accrued. Claims for contribution to general average shall be 
deemed to have accrued on the date on which the general average act was 
performed, while claims for salvage shall be deemed to have accrued on the date 
on which the salvage operation was terminated. 
In the event of a forced sale of a wreck of ship, following its removal by the 
MARINA, the costs of such removal shall be paid out of the proceeds of the 
sale before all other claims secured by maritime lien on the ship. If at the time 
of the forced sale, the vessel is in the possession of a ship-builder or a ship-
repairer shall surrender possession of the ship to the purchaser but is entitled to 
obtain satisfaction of a claim out of the proceeds of the sale after the satisfaction 
of the claims of holder of maritime liens mentioned in Section 34 hereof. 
SECTION 38. Extinguishment of Maritime Liens. - Maritime liens shall be 
extinguished after a period of one (1) year from the time when the claims secured 
thereby arose unless, prior to the expiration of such period, the ship has been 
arrested and the ownership thereof transferred through a forced sale ordered by 
a competent court or tribunal. 
The period of one (1) year shall not be subject to suspension or 
interruption: Provided, That the time shall not run while the person enforcing 
the lien is prevented from arresting the ship legally or by circumstances beyond 
his control. 
Maritime liens which arose prior to the effectivity of this Act shall be 
extinguished one (1) year after the date of such effectivity. 
SECTION 39. Rights of Retention. - The following persons, when in possession 
of ship or ship that is under construction, shall have the right to retain such ship 
or ship under construction, without need of a court order: 


a. a shipbuilder, to secure claims arising out of the construction of, or other 
work carried out in relation to the ship; and 
b. a ship repairer, to secure claims arising out of the repair of, including 
the modification, conversion or reconstruction of the ship, or other 
work carried out in relation to the ship, affected during such 
possession. 
SECTION 40. Extinguishment of Rights of Retention. - The rights of retention 
under the preceding section shall be extinguished when: 
a. the claim in respect of which said right has been exercised is met or is 
otherwise discharged; 
b. the ship ceases to be in the possession of the ship-builder or ship-
repairer as the case may be; or 
c. the competent court orders the release of the ship. 
SECTION 41. Assignment or Subrogation. - The assignment of or subrogation 
to a claim secured by a maritime lien results in the simultaneous assignment of 
or subrogation to such maritime lien. 
Claimants holding maritime liens may not subrogated to the compensation 
payable to the owner of the ship under an insurance contract. 
SECTION 42. Exclusions. - The provisions of this Title shall not apply: 
a. a claim for the enforcement of a maritime lien that is already the 
subject of a pending case and which is sought to be enforced under 
the provisions of Presidential Decree No. (PD No.) 1521, or the 
Ship Mortgage Decree, at the time of the effectivity of this Act; 
b. a maritime lien which arose prior to the effectivity of this Act, unless 
such lien has already prescribed. 
  
CHAPTER VII 
SHIP MORTGAGES 
SECTION 43. Application. - The provisions of this Chapter shall apply to every 
mortgage wherever executed in respect of: 
a. a ship that is registered in the Philippines; or 
b. a ship that is under construction in the Philippines. 


SECTION 44. Subject of a Ship Mortgage. - Unless otherwise stipulated, a 
ship mortgage shall include all property of the mortgagor which appropriated to 
the ship and on board at the time when the mortgage contract is entered into, or 
which is later substituted for such property. 
In case the ship is under construction, the ship mortgage shall include all 
materials, machinery, and equipment owned by the mortgagor that are within the 
premises of the builder's yard and distinctly identified as intended to be 
incorporated into the ship under construction. 
SECTION 45. Formal Validity. - A ship mortgage shall not be valid unless it 
is made by or with the consent of the owner of the ship or ship under 
construction, and in writing and signed by the mortgagor and mortgagee. 
However, the ship mortgage may be validly made in the form of an electronic 
document as defined by law. Except as otherwise expressly provided in this Act, 
no other document for formal validity shall be required in order for the ship 
mortgage to be binding and effective upon the mortgagor and the mortgagee. 
SECTION 46. Registration of Ship Mortgages. - Every mortgage of a ship 
that is registered or under construction in the Philippines shall, on proper 
application, be registered in the Record of Mortgages and Encumbrances 
established in Section 27 hereof. If such mortgage is not registered, it shall be 
unenforceable against the ship and third persons. 
All entries in the Register of Mortgages and Encumbrances pertaining to 
the mortgage of a ship shall be annotated on the back of the Certificate of 
Philippine Registration, stating the time and date of transfer and the nature and 
subject matter of the encumbrance. All ship mortgages shall be registered in the 
order in which they are filed, indicating the date and time of registration. 
The MARINA shall, upon the registration of a mortgage, issue two (2) official 
copies of the relevant entry in the Registry to the mortgagor. Each official copy of 
the entry shall bear the official time and date of the registration of the mortgage. If 
a ship mortgage is transferred or materially amended or if one mortgage is 
substituted for another, the transfer, amendment or substitution that is not entered 
into the Record shall be unenforceable against the ship and third persons. 
SECTION 47. Disclosure by the Mortgagor. - Upon request of the mortgagee 
prior to the execution of the mortgage to which they are parties, the mortgagor 
shall provide in writing the details of any prior ship mortgage and any maritime 
lien that is known to the mortgagor, upon the ship which is the subject of the ship 
mortgage. 
SECTION 48. Priority Between Ship Mortgages. - Ship mortgages shall rank 
in the order of their being recorded with the Registry. 


SECTION 49. Notification of De-registration of Subject of Ship Mortgage. - 
Except in the case of a forced sale upon order of a competent court, the de-
registration of a ship shall not be permitted unless all registered ship mortgages are 
first deleted, or the written consent of all holders of such mortgages is obtained. 
Where the de-registration of the ship is obligatory according to the 
provisions of this Act or its implementing regulations, the MARINA shall notify 
the holders of registered ship mortgages of the pending de-registration 
in order to enable such holders to take appropriate action to protect their 
interests. Unless the said holders consent to a shorter period, the de-registration 
shall not be implemented until after a lapse of a reasonable time from notification 
in writing, which shall not be less than three (3) months. 
There shall be no other requirements for formal validity except as stated 
in the preceding paragraphs. 
 
CHAPTER VIII 
ENFORCEMENT OF MORTGAGE 
SECTION 50. Grounds to Enforce a Ship Mortgage. - A mortgagee shall be 
entitled to enforce the security represented by the ship under a mortgage in the 
following cases: 
a. The mortgagor defaults in the discharge of the indebtedness or other 
obligations secured by the ship mortgage; 
b. The mortgagor or any person in possession of the mortgaged property 
substantially prejudices the security of the mortgagee by any act or 
omission; 
c. The mortgagor commits any breach of the mortgage contract which, by 
the terms of the contract, entitles the mortgagee to enforce the security. 
SECTION 51. Remedies of Mortgagees. - The enforcement of the security 
under the mortgage may be carried out by: 
a. Arresting the ship subject to the mortgage and applying for an order for 
its forced sale by competent court; or 
b. Foreclosing the mortgage; or 
c. Any other manner stipulated in the mortgage contract. 
SECTION 52. Arrest and Forced Sale of a Ship. - A mortgagee entitled to enforce 
a mortgage, or a person exercising a maritime lien, may bring a proceeding in 
rem against the ship which is the subject of the mortgage or to which the maritime 
lien attaches, as the case may be, before a competent court having jurisdiction 
over the ship. The petitioner 


shall be entitled to apply to the court ex parte for an order for the arrest of said 
ship. 
The petitioner's claim shall be supported by an affidavit stating the 
circumstances which shall be the basis to enforce the mortgage or lien. An 
affidavit executed abroad must be duly authenticated. If the affidavit 
satisfactorily establishes the petitioner's claim, the competent court shall order 
the arrest of the ship. 
The court may require the petitioner to post a bond or other security before 
issuing the order of arrest. If so required, the bond or security shall not exceed 
the amount of the mortgage debt or lien. 
The court shall, after judgment, order the forced sale of the ship to satisfy 
the claim, unless the ship has been released in accordance with the next 
succeeding section. 
The rules on preliminary attachment under the Rules of Court shall not 
apply in the arrest of ships. 
SECTION 53. Release of Arrested Ship. - The court shall not release the 
arrested ship prior to rendition of judgment unless the mortgagor, the owner of 
the ship, or any person authorized to act on his behalf or of any other person 
interested in the ship: 
a. applies to the court for an order releasing the ship from arrest, by making 
a cash deposit, and if the same is not possible upon presentation of 
competent evidence, by filing a counter-bond or security in an amount 
double the value of the claim, to secure the payment of any judgment 
that the mortgagee may recover in the action;or 
b. proves that the arrest was improperly or irregularly made. 
SECTION 54. Notice of Forced Sale of a Ship. - Prior to the forced sale of a 
ship, the court shall give, or cause to be given, at least thirty (30) days prior notice 
of the time and place of such sale, either in customary or electronic form, to the 
following: 
a. all holders of registered mortgages; 
b. such holders of maritime liens whose claims have been notified to the 
court and have not expired; 
c. all other persons having an interest in the ship, whose interests have 
been notified to the court. 
SECTION 55. Effect of Forced Sale of a Ship.- In the event of the forced sale 
of a ship, all mortgages, except those assumed by the purchaser with the consent 
of the holders, and all liens and other encumbrances of whatsoever nature, shall 
cease to attach to the ship but shall attach to the proceeds of sale: Provided, That 
at the time of the sale, 


the ship is in the jurisdiction of the Philippines, and the sale has been effected 
in accordance with the laws of the Philippines. 
Any charter party or contract for the use of the ship in existence at the time 
of the forced sale shall be deemed to be terminated, without prejudice to any 
claim the charterer may have against the owner of the ship at the time of the 
sale. 
SECTION 56. Bankruptcy Not Affecting Ship Mortgage. - The mortgage of a 
ship is not affected by the bankruptcy or rehabilitation of the mortgagor after 
the date of the registration of the mortgage. 
SECTION 57. Distribution of the Proceeds. -The costs awarded by the 
competent court and expenses arising out of the arrest and sale of the ship shall 
be paid first out of the proceeds of such sale. Thereafter, the following claims 
shall be satisfied out of the balance of the proceeds of the sale in the order herein 
enumerated, observing also the preference among each category of claims, 
established in Sections 34 and 36 hereof on maritime liens and Section 46 hereof 
on ship mortgages: 
a. maritime liens; 
b. registered mortgages; and 
c. rights of retention. 
SECTION 58. Certificate of Release. - When a ship registered in the 
Philippines has been the object of a forced sale in the same country, the 
competent court having jurisdiction shall, at the request of the purchaser, issue 
a certificate to the effect that the ship is sold free of all mortgages, maritime 
liens, and other encumbrances, except those assumed by the purchaser. Upon 
the production of the abovementioned certificate, the MARINA shall delete all 
registered mortgages from the Registry, except those assumed by the purchaser, 
or issue a certificate of de-registration for the purpose of registration, as the case 
may be. 
SECTION 59. Effect of the Forced Sale of a Ship in Foreign States.- The forced sales in a 
foreign state of a ship registered in the Philippines shall be recognized and effective in the 
Philippines: Provided, That the procedure for such forced sale in that foreign state 
substantially corresponds to the appropriate procedure set out herein. 
CHAPTER IX 
FOREIGN LIENS AND MORTGAGES 
SECTION 60. Foreign Maritime Liens. - A claim governed by the law of a 
State other than the Philippines and recognized by such law as giving rise to a 
maritime lien or right of a similar nature against the owner, or against the demise 
or other charterer, manager, or operator of a ship, shall be recognized by and 
enforceable in the Philippines: Provided, That said claim constitutes or 
corresponds substantially to a claim set out in 


this Act. The provisions of this Act relating to maritime liens, including priority, 
ranking of liens between themselves, and enforcement, shall also apply to such 
claims. 
SECTION 61. Foreign Mortgages. - A foreign mortgage, or any mortgage or 
hypothec which relates to a ship of foreign registry, shall be recognized and 
enforceable in the Philippines: Provided, That: 
a. such mortgage has been effected and registered or otherwise recorded 
in accordance with the law of the State where the ship is registered; 
b. such register and any instrument or document which are required to be 
deposited are open to public inspection, and that extracts of the register 
and copies of such instruments are obtainable from the registrar; and 
c. either the register or the loan agreement specifies: 
1. the name and address of the person in whose favor the mortgage 
has been effected or that it has been issued to bearer; 
2. the amount secured by the mortgage or the manner of calculating 
said amount; 
3. the date of the mortgage; and 
4. such other particulars, which, according to the law of the State where 
the ship is registered, determine the rank in regard to other registered 
mortgages. 
All matters relating to the procedure for enforcement of foreign mortgages 
shall be governed by this Act. 
SECTION 62. Priority and Ranking of Foreign Mortgages. - Foreign 
mortgages shall be subordinate to maritime liens as set out in this Act. 
The ranking of foreign-registered mortgages as between themselves, and 
their effect as regards third parties, shall be governed by the law of the State 
where the ship is registered. 
TITLE IV 
LIMITATION ON LIABILITY 
CHAPTER X 
RIGHT TO LIMIT LIABILITY 
SECTION 63. Application. - The following may invoke the right to limit their 
liability in accordance with the rules provided for in this Title for the claims set 
out in the succeeding section: 


a. Ship owners; 
b. Ship operators; 
c. Bareboat charterers; 
d. Ship managers; 
e. Salvors with respect to claims set forth in Section 65 hereof; 
f. Any person whose act, neglect, or default the ship owner, ship 
operator, bareboat charterer, ship manager, or salvor is 
responsible for; and 
g. Insurers who assume the liability of any ship owner, ship operator, 
bareboat charterer, ship manager, or salvor. 
They may invoke their right to limit liability against any claimant in a 
judicial action who has sought the arrest of their vessels in order to enforce a 
claim which is subject to limitation. 
SECTION 64. Claims Subject to Limitation. - The following claims made 
against the persons set forth in the preceding section or against the ship, 
whatever the basis of liability may be, shall be subject to the limitation of the 
liability: 
a.  Claims in respect of loss of life or personal injury, or loss of or damage 
to property, including damage to harbor works, basins, waterways, 
and aids to navigation, occurring on board or in direct connection with 
the operation of the ship or with salvage operations and consequential 
loss resulting therefrom; 
b. Claims in respect of loss resulting from delay in the carriage by sea of 
cargo, passengers, or their luggage; 
c. Claims in respect of other loss resulting from the infringement of rights, 
other than contractual rights, occurring in direct connection with the 
operation of the ship or of salvage operations; 
d. Claims in respect of loss or damage arising from the raising, removal, 
destruction, or the rendering harmless of a ship which is sunk, wrecked 
or abandoned, including anything that is or has been on board such 
ship; 
e. Claims in respect of loss or damage resulting from the removal, 
destruction, or rendering harmless of the cargo of the ship; and 
f. Claims in respect of measures taken in order to avert or minimize loss 
for which the person liable may limit his liability in 


accordance with this Title, and any further loss caused by such 
measures. 
SECTION 65. Claims Not Subject to Limitation. - The following claims shall 
not be subject to any limitation of liability in accordance with this Title: 
a. Claims arising from the contract of salvage or from any salvage 
operation rendered in accordance with relevant Philippine law on 
salvage or any applicable international salvage convention, including 
any claim for special compensation payable under a contract of 
salvage, or any contribution in general average; 
b.  Claims for oil pollution damage within the meaning of the applicable 
convention covering the civil liability for oil pollution damage or any 
amendment thereto which is in force; 
c. Claims subject to any international convention governing or 
prohibiting the limitation of liability for nuclear damages; 
d. Claims against the ship owner of a nuclear ship for nuclear damage; 
e.  Claims brought by employees against the ship owner, ship operator, 
bareboat charterer, ship manager, or salvor, where the duties of such 
employees are connected with the ship or with the salvage 
operations, as the case may be, or their heirs, successors, or assigns, 
if under the law governing the contract of employment, the ship 
owner, ship operator, bareboat charterer, ship manager, or salvor is 
not entitled to limit his liability in respect of such claims, or if the 
law governing the contract of employment permits a limit of liability 
greater than that provided for in this Act. 
SECTION 66. Conduct Barring Limitation. - Any shipowner, ship operator, 
bareboat charterer, ship manager, or salvor, or any person acting on their behalf, 
shall not be entitled to limit liability if it is proven that the loss resulted from 
the personal act or omission of such ship owner, ship operator, bareboat 
charterer, ship manager, or salvor, or any person acting on their behalf, and 
such act or omission was committed with the intent to cause such loss, or it was 
done recklessly and with the knowledge that such loss would probably result. 
SECTION 67. Counterclaims; Right to Set Off. - When a ship owner, ship 
operator, bareboat charterer, ship manager, or salvor, who is entitled to limit his 
liability, has a counterclaim against the claimant arising out of the same 
occurrence, their respective claims shall be set off against each other and the 
limits of liability shall only apply to the balance of the claim, if any. The right 
to set off can be invoked only if both parties are entitled to limit their respective 
liabilities and their respective claims do not fall within the provisions of 
Sections 65 and 66 of this Act. 


CHAPTER XI 
LIMITS OF LIABILI1Y 
SECTION 68. General Limits. - The general limits of liability for claims, other 
than for passenger claims, arising from any distinct occasion shall be calculated 
as follows: 
a. In respect of claims for loss oflife or personal injury: 
1. Two million (2,000,000) units of account for a ship with a 
tonnage not exceeding two thousand (2,000) tons; 
2.  For a ship with a tonnage in excess thereof, the following 
amount, in addition to that mentioned in (a) (1): 
i. For each additional ton from 2,001 to 30,000 tons, 800 
units of account; 
ii. For each additional ton from 30,001 to70,000 tons, 600 
units of account; 
iii. For each additional ton in excess of 70,000 tons, 400 
units of account. 
b. In respect of any other claims: 
1. One million (1,000,000) units of account for a ship with a 
tonnage not exceeding 2,000 tons; 
2. For a ship with a tonnage in excess thereof, the following 
amount, in addition to that mentioned in (b) (1): 
i. For each additional ton from 2,001 to 30,000 tons, 
400  units of account; 
ii. For each additional ton from 30,000 to70,000 tons, 
300  units of account; and 
iii. For each additional ton in excess of 70,000 tons, 200 
units of account. 
The MARINA, with the approval of the Secretary of Transportation, may, 
by regulation, revise the limits of liability provided for in this section to 
align such limits with applicable international maritime conventions. 
SECTION 69. Claims for Loss of Life in Excess of the Stipulated Limit. - If the 
amount calculated in accordance with subsection (a) of the preceding section is 
insufficient to pay in full all the claims for loss of life or personal injury, the 
amount calculated in accordance with subsection 
(b) shall be available for the payment of the unpaid balance of the claims under 
subsection (a). 


In this case, the unpaid balance for claims for loss of life and personal 
injury shall rank ratably with all other claims falling under subsection (b): 
Provided, That if there should be any claim arising from damage to harbor 
works, basins and waterways, and aids to navigation, these shall be satisfied 
first before any other claim falling under subsection (b) are satisfied, including 
any unsatisfied claims for loss of life or personal injury. 
SECTION 70. Salvor's Limit of Liability when not Operating from a Ship. - 
The limit of liability for any salvor who is not operating from any ship or 
salvage tug, or who is operating solely on the ship to, or in respect of, which he 
is rendering salvage services, shall be calculated in accordance with the 
provisions of Section 69 of this Act applying a tonnage of 1,500 tons. 
SECTION 71. Limit of Liability for Passenger Claims. - The limit of liability of 
a ship owner, ship operator, bareboat charterer, or ship manager, for passenger 
claims relating to loss of life or personal injury arising out of any distinct 
occasion, shall be an amount equivalent to One hundred seventy-five (175) units 
of account multiplied by the number of passengers which the ship is authorized 
to carry according to the ship's certificate. 
Claims for loss of life or personal injury to passengers of a ship shall 
mean any such claims brought by or on behalf of: 
a. Any person carried on the ship under a contract of passenger 
carriage; or 
b. Any person carried on the ship who, with the consent of the master, is 
accompanying a vehicle, or a shipment of live animals, or other cargo 
which is covered by a contract for the carriage of goods. 
SECTION 72. Formula for Converting the Unit of Account to Philippine Peso. 
- The unit of account mentioned in this Chapter shall be converted to Philippine 
Pesos according to the value of the Philippine Peso on the date the limitation 
fund is constituted, or payment is made, or security is given. The equivalent 
value of the Philippine Peso shall be calculated in accordance with the method 
of valuation applied by the International Monetary Fund (IMF) for its 
operations and transactions in effect on the applicable date. 
SECTION 73. Aggregation of Claims for Loss of Life and Personal Injury and 
for Other Claims. - The limits of liability for loss of life and personal injury and 
for other claims determined in accordance with Section 68 hereof shall apply 
to the aggregate of all claims which arise on any distinct occasion against: 
a. The ship owner, ship operator, bareboat charterer, or ship manager, 
and any person whose act, neglect, or default such 


ship owner, ship operator, bareboat charterer, or ship manager is 
responsible for; or 
b. The ship owner, ship operator, bareboat charterer, or ship manager 
of a ship rendering salvage services from a ship or the salvor or 
salvors operating from a salvage tug, and any person whose act, 
neglect, or default the ship owner, ship operator, bareboat charterer, 
ship manager, or salvor is responsible for; or 
c. The salvor who is not operating from a ship or salvage tug or who is 
operating solely on the ship to, or in respect of, which the salvage 
services are rendered and any person whose act, neglect, or default 
the salvor is responsible for. 
 
CHAPTER XII 
LIMITS OF LIABILITY 
SECTION 74. Creation of a Limitation Fund. -Any person entitled to 
limit his liability in accordance with Section 63 hereof and who is alleged to be 
liable for a claim provided in Section 64 hereof may, at any time during the 
hearing of the case or after the arrest of his vessel, constitute a fund with the 
court in which legal proceedings have been instituted for the satisfaction of the 
claim subject to limitation. 
The fund shall be in an amount equivalent to the limits of liability set forth 
in Sections 68, 70, and 71 hereof, as the case may be, together with any interest 
due thereon from the date of the occurrence giving rise to the liability until the 
date of the creation of the fund. The total amount of the fund shall be subject to 
the rules on aggregation of claims set forth in Section 73 of this Act. 
Any fund created shall be available only for the payment of claims in 
respect of which limitation of liability can be invoked. 
SECTION 75. Insurance Indemnity Cover. - Every ship owner or bareboat 
charterer shall be required to maintain adequate insurance coverage or 
protection and indemnity coverage to meet the financial responsibility for any 
liability which such ship owner or bareboat charterer may incur for loss of or 
injury to human life, damage to property, and to the marine environment. In 
determining the limits for mandatory insurance coverage for seagoing ships, 
the MARINA shall take into account and be guided by the applicable limits of 
liability provided in relevant international conventions. In setting the limits for 
mandatory insurance coverage coastwise vessels, the MARINA shall consider 
the prevailing local social, economic, and other conditions in the Philippines. 
SECTION 76. Form of the Fund. - The fund may be created, either by 
depositing the sum with a bank or other financial institution 


designated by the court, or by providing a bond, or other security acceptable 
to the court. 
The fund constituted by any of the persons mentioned in Section 63, 
subsections (a), (b), (c), (d) or (e) shall likewise be deemed constituted in favor 
of the persons mentioned in subsections (0 and (g) of the same. 
SECTION 77. Distribution of the Fund. - Subject to the provisions of Sections 
68 and 69 hereof, the limitation fund shall be distributed among the claimants 
in proportion to their claims against the fund as determined by the court. 
SECTION 78. Subrogation of Rights. - If at any time before the fund is 
distributed, the ship owner, ship operator, bareboat charterer, ship manager or 
salvor, or their respective insurers, settles a claim made against and payable by 
the fund, such person shall, up to the amount paid, acquire by subrogation the 
rights which the claimant would have enjoyed under this Title. 
SECTION 79. Contingency Fund for Expected Claim. - Where the ship 
operator, bareboat charterer, ship manager or salvor, or their respective 
insurers, establishes that it may be compelled to pay a claim at a later date, 
whether in whole or in part, and because of such payment, the ship owner, ship 
operator, bareboat charterer, ship manager or salvor, or their respective insurers, 
would have enjoyed a right of subrogation if the claim has been paid before the 
fund was distributed, the court having jurisdiction over the claim and in which 
the fund has been constituted may order that a sufficient sum from the fund be 
provisionally set aside to enable the person who has been subrogated to the 
rights of the claimant to enforce his claim against the fund at such later date. 
SECTION 80. Bar to Other Actions. - Where a limitation fund has been 
constituted in accordance with Section 74 hereof, any person having made a 
claim against the fund shall be barred from enforcing such claim against any 
other assets of the persons mentioned in Section 63 hereof and on whose behalf 
the fund has been constituted. 
SECTION 81. Release from Arrest after the Constitution of the Limitation 
Fund. - After a limitation fund has been constituted in accordance with Section 
74 of this Act, any ship or other property, belonging to a shipowner, ship 
operator, bareboat charterer, ship manager, or salvor on whose behalf the fund 
has been constituted, which has been arrested or attached in accordance with 
Title III of this Act in order to satisfy a claim which is enforceable against the 
fund or any other bond or security given, may be released from arrest at the 
discretion of the court. Such release shall, however, be mandatory if the 
limitation fund has been constituted: 
a. At the port where the occurrence took place; 


b.  If the occurrence took place out of port, at the first port of call of the 
ship after such; 
c. At the port of disembarkation in respect of claims for loss of life or 
personal injury; 
d. At the port of discharge in respect of damage to cargo; or 
e. At the port where the arrest is made. 
The provisions of this section and of the immediately preceding section shall 
apply only if the claimant may bring a claim against the limitation fund before the 
court administering that fund and the fund is actually available and freely 
transferable to the claimant in respect of the claim. 
 
TITLE V 
ENFORCEMENT OR INVESTIGATION 
SECTION 82. Report of Any Incident Involving a Philippine Registered Ship. - 
When any Philippine flag vessel sustains an accident or causes any accident 
involving the loss of life, material loss of property, or serious injury to any person, 
or receives any damage affecting her seaworthiness or her efficiency, or if it should 
cause any pollution or damage to the marine environment, regardless of where such 
accident or incident may occur, the ship owner, ship operator, bareboat charterer, 
ship manager, agent, or master of such vessel shall immediately, after the 
occurrence of the accident or incident, send a report of the accident or incident or, 
in the case of seagoing vessels, to the head office of the MARINA in the port of 
Manila, stating: 
a. The name of the vessel; 
b. The port to which the vessel belongs; 
c. The place where the incident occurred; 
d. The nature and probable cause of the incident; 
e. The number and names of those who perished; and 
f. The estimated amount of loss or damage to the vessel, the cargo, or the 
marine environment. 
The ship owner, ship operator, charterer, ship manager, agent, or master may 
be required to furnish such other information as shall be called for. 


TITLE VI 
CASUALTY INVESTIGATION 
SECTION 83. Marine Safety Investigation. - Following the occurrence of an 
accident or incident involving a Philippine flag coastwise or seagoing vessel 
resulting in the loss of life, material loss of property, or serious injury to any 
person, or receives any damage affecting her seaworthiness or her efficiency, 
or if it should cause any pollution or damage to the marine environment, 
regardless of where such accident or incident may occur, the MARINA on its 
own or through a duly constituted independent group of suitably qualified 
safety inspectors, shall immediately undertake a marine safety investigation. 
This investigation shall be separate from any other form of investigation that 
may be undertaken by any other government agency. 
SECTION 84. Nature of the Investigation. - The investigation undertaken in 
accordance with this Chapter shall not apportion blame or determine liability 
but shall be conducted to determine the cause of the accident and the 
identification of measures to prevent the occurrence of similar marine 
casualties, accidents, or incidents in the future. 
SECTION 85. Power of Safety Investigators to Investigate. - Maritime safety 
investigators appointed by the MARINA shall have full powers to board the 
Philippine flag ship regardless of where it may ne found, and interview the 
master and the crew and any other person involved, and acquire such 
evidentiary material for purposes of undertaking and completing the marine 
safety investigation. 
SECTION 86. Amendment of Safety Regulations. - Following completion of 
the safety investigation and upon a complete study of the safety investigation 
report, the MARINA shall take measures to amend its safety regulations to 
implement the recommendations made in the report. 
SECTION 87. Providing Reports to the International Maritime Organization. 
- The MARINA, as competent authority, shall provide a copy of the report to 
the IMO to enable a wide dissemination of information and to assist the 
international maritime community to address safety issues. 
 
TITLE VII 
OPERATION OF VESSELS 
SECTION 88. Ship Construction. - Every new building registered under 
Philippine laws shall be constructed in accordance with standards for ship 
construction set forth in international maritime conventions and implemented 
through government regulations. 
Ship construction shall be under the supervision of the MARINA or a 
recognized organization appointed for the purpose. The recognized 
organization shall oversee the construction of the ship and ensure that 


the construction regulations provided in international maritime conventions 
and those issued by the MARINA covering the structural strength and integrity 
of all parts of the ship's hull and its appendages, as well as the safety and 
reliability of the main propulsion, steering systems and auxiliary systems of the 
ship are followed. 
SECTION 89. Navigation and Communications Equipment. - Every 
Philippine flag vessel shall have on board such navigation and communication 
equipment and apparatus required by international maritime convention for the 
safe navigation of ships. Every equipment and apparatus that shall be required 
to be installed on board shall be suited for the type, tonnage, power, means of 
propulsion, and trading limitations of the particular ship. 
SECTION 90. Equipment to Prevent Marine Pollution. - Every Philippine flag 
vessel shall have on board equipment and apparatus to prevent, reduce, or 
control pollution to the marine environment emanating from ships. Every 
equipment and apparatus required to be installed on board shall be suited for 
the type, tonnage, power, means of propulsion, and trading limitations of the 
particular ship. 
SECTION 91. Inspections and Surveys. - To ensure the proper maintenance 
of the ship's hull, machinery, and equipment, its through life compliance with 
international conventions and government regulations, and its safe operation, 
every Philippine flag vessel shall be subject to periodic inspections and 
surveys. 
SECTION 92. Scope of Inspections and Surveys. - The inspections and surveys 
shall be conducted in accordance with international maritime convention and 
government regulations, and shall include an inspection and survey of the 
ship's: 
a. Hull structure; 
b. Machinery and equipment; 
c. Life-saving equipment; 
d. Fire-fighting equipment; and 
e. Radio and communications installations. 
SECTION 93. Extent of Authority of Recognized Organization. - The MARINA, 
in appointing a recognized organization or classification of society to conduct the 
inspection and survey of ships, shall inform the recognized organization of the 
specific responsibilities and conditions of the authority delegated to it. 
SECTION 94. Issuance of Certificates. - The recognized organization, 
pursuant to the functions delegated to it by the MARINA, shall have the 
authority to issue vessel certificates to every Philippine flag 


vessel and for this purpose, the vessel certificates issued by such recognized 
organization shall be deemed to have met the requirements of this Act. 
Copies of the vessel certificates shall be submitted to the MARINA which 
shall, upon verification of compliance, issue a certificate of inspection in favor 
of the complying vessel confirming the findings of the recognized organization. 
SECTION 95. Availability of Vessel Certificates. - The vessel certificates 
mentioned in the immediately preceding section shall be readily available on 
board the vessel for examination at all times. 
 
TITLE VIII 
MANNING REQUIREMENTS 
SECTION 96. Citizenship of Crew. - Vessels engaged in coastwise trade, as 
well as sea-going vessels, shall employ full Filipino crew: Provided, however, 
That seagoing vessels shall be subject to the exemption mentioned in Section 
9b(5) hereof. 
An exemption from this citizenship requirement on such terms and 
conditions and for a limited period as may be determined by the MARINA may 
be obtained from the MARINA upon written application from the ship owner 
or operator. This exemption, however, shall not be granted to coastwise vessels. 
SECTION 97. Crew Competence. - Every member of the crew of a Philippine 
flag vessel shall possess the appropriate certificate of competency setting forth 
his competence to serve in the capacity and perform the functions involved at 
the level of responsibility, for the position held, for the type, tonnage, power, 
means of propulsion, and trading limitations of the ship concerned. 
The certificate of competency, as well as any endorsements thereto, and 
any renewals thereof, shall be issued by the MARINA. The certificate of 
competency shall attest to the fact that the seafarer, to whom it is issued, meets 
the requirements for service, age, medical fitness training, qualification, and 
examinations for the position held. 
SECTION 98. Crew Deployment. - Crew deployment to Philippine flagged 
seagoing vessels engaged in international or regional trade shall continue to be 
undertaken by the Philippine Overseas Employment Administration (POEA) in 
accordance with the appropriate provisions of the Maritime Labor Convention 
(MLC). 
TITLE IX 
FINAL PROVISIONS 
SECTION 99. Requisition of Vessels. - The President of the Philippines may, 
in times of war and other national emergency, when the 


public interest so requires, order the requisition of any and all vessels of 
Philippine registry, absolutely or temporarily, for any naval or military 
purpose. The Government shall pay the owner or operator of the vessel, based 
on normal conditions at the time of requisition: 
a. The fair market value, if the vessel is taken absolutely; or 
b. The fair charter value, if the vessel is taken temporarily, for the period 
commencing from the takeover by the Government to the date the 
vessel is returned to its owner/operator. 
SECTION 100. Streamlined and Rationalized Procedures. - To ensure the 
effective implementation of this Act and the further streamlining of processes 
to support the country's competitiveness and promote trade facilitation, the 
MARINA shall coordinate with the Department of Foreign Affairs (DFA), 
Department of Labor and Employment (DOLE), Department of Health (DOH), 
Department of Interior and Local Government (DILG), Securities and 
Exchange 
Commission 
(SEC), 
Philippine 
Overseas 
Employment 
Administration (POEA), Bureau of Immigration, Board of Investments, Bureau 
of Customs (BOC), Bureau of Internal Revenue (BIR), Philippine Ports 
Authority (PPA), Philippine Coast Guard (PCG), Bureau of Fisheries and 
Aquatic Resources (BFAR), Bureau of Quarantine, and other relevant offices 
and agencies to further streamline policies, requirements, processes, 
procedures, and national and local government fees, dues, charges, tariffs, 
assessments, rates, and other levies, on the acquisition, registration, and 
operation of vessels; the hiring, deployment, change, and repatriation of crew; 
the construction, repairs, maintenance, and recycling of ships; and other 
government and business processes concerning vessels in the Philippine 
Registry. 
SECTION 101. Implementing Rules and Regulations. - Within sixty (60) days 
after the effectivity of this Act, the MARINA shall issue the implementing rules 
and regulations as may be necessary to implement the provisions of this Act. 
SECTION 102. Administrative Offenses and Penalties. - To ensure faithful 
compliance with the rules and regulations issued in accordance with the 
preceding section, the MARINA, through summary 
administrative 
proceedings, may identify, prohibit, and penalize such acts and activities that 
may reduce the efficiency and reliability of the Philippine Ship Registry, 
impede the effectiveness of the exercise of Philippine jurisdiction and control 
over Philippine flag vessels, or otherwise interfere with its duties and 
responsibilities as a flag State and the implementation of this Title. 
For this purpose, the MARINA is authorized to impose an 
administrative fine of not less than Ten thousand pesos (PhP10,ooo.oo) but not 
more than Five hundred thousand pesos (Php500,ooo.oo), as well as the 
penalty of suspension, cancellation, or revocation of the relevant 
certificates, for violations of this Act and such rules and regulations that it 
may issue pursuant to this Act. 


The range of fines shall be subject to review and revision every five 
(5) years from the date of effectivity of this Act, but in no case shall any increase 
exceed an amount equivalent to twenty percent (20%) of that previously 
imposed. 
SECTION 103. Transitory Provisions. - Every ship currently registered 
under the laws of the Philippines and granted the privilege to fly its flag shall 
be deemed to be registered under this Act insofar as its registration is not 
inconsistent with the provisions of this Act and such registration shall continue 
to be valid until its expiration unless sooner revoked by the MARINA. 
Any ship mortgage entered into in accordance with the provisions of the 
Ship Mortgage Decree or the Chattel Mortgage Law shall continue to be valid 
and effective and its registration shall be transferred to the MARINA in 
accordance with the provisions of this Act. Nothing in the transfer shall change 
or in any way alter or affect any preference a registered mortgage may enjoy 
or the original date on which such mortgage was entered in the registry. 
SECTION 104. Separability Clause. - If, for any reason, any section, 
subsection, clause, or term of this Act is held to be illegal, invalid, or 
unconstitutional, such parts not affected by such declaration shall remain in full 
force and effect. 
SECTION 105. Repealing Clause. - The following laws are hereby 
repealed: 
a. Articles 573 to 585 of the Code of Commerce of 1888; 
b. Sections 801 to 821 of Republic Act No. 1937; 
c. Republic Act No. 913; 
d. Republic Act No. 1407; 
e. Republic Act No. 6106; 
f. Republic Act No. 7471, as amended; 
g. Republic Act No. 9301; 
h. Presidential Decree No. 214; 
1. 
Presidential Decree No. 760, as amended. 
The provisions of the following laws covering the powers and functions 
of the MARINA are hereby amended insofar as they are inconsistent with 
Section 6 of this Act: 


J. Presidential Decree No. 474, as amended; 
k. Executive Order No. 125 and 125-A, as amended; 
1. Section 10 of Republic Act No. 9295. 
Section 14 of Republic Act No. 9295 is hereby amended insofar as it is 
inconsistent with Section 51 of this Act. 
Such other laws, presidential decrees, executive orders, issuances, rules, 
and regulations or parts thereof, which are otherwise inconsistent with the 
provisions of this Act are hereby repealed, amended, or modified accordingly. 
SECTION 106. Effectivity. -This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation. 
 
Approved, 
 
 
 
 
 
 
KHYMER ADAN T. OLASO