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[sy RECEIVED 2
pur, 01 UL 2013
Republic of the Philippines STN
HOUSE OF REPRESENTATIVES 2 }
Quezon City 2
INDEX OH
SIXTEENTH CONGRESS
First Regular Session
be ted 8
HOUSE BILL NO. uN

Introduced by : REP. RAUL V. DEL MAR

EXPLANATORY NOTE

The proposed amendments seek to amend certain provisions of Republic Act
7621, otherwise known as “An Act Creating the Cebu Port Authority, Defining its
Powers and Functions, Providing Appropriations Therefor,” to strengthen the
operational, financial and administrative capabilities of the Authority.

The proposed amendments essentially seek the granting, among others, of
tax exemption privileges, full fiscal autonomy, additional administrative powers to
make the Authority more effective and efficient in carrying out its mandate in port
development, maintenance dredging of ports, pilotage, police authoritym the ample
protection of the welfare of its workers, injuctive powers, and providing punitive
provision for violators of the Authority's port rules and regulations.

With these proposed amendments, it is believed that the Cebu Port Authority
will be able to address current and future demands of its stakeholders, spur maritime
commerce in the region, and thus fully attain the purposes and objectives for which it
was created.

| i
ritv.0 MAR



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS.

First Regular Session
ane
HOUSE BILL NO. edie

Introduced by : REP. RAUL V. DEL MAR

AN ACT
AMENDING CERTAIN PROVISIONS OF REPUBLIC ACT NO. 7621 OTHERWISE
KNOWN AS 'AN ACT CREATING THE CEBU PORT AUTHORITY DEFINING ITS
POWERS AND FUNCTIONS, PROVIDING APPROPRIATION THEREFOR AND
FOR OTHER PURPOSES'

Be it enacted by the Senate and the House of Representatives of the
Philippines in Congress assembled:

SECTION 1. Section 3 of Republic Act 7621 is hereby amended by adding a
subsection to read as follows:

“SEC. 3. (A) TAX EXEMPTION. - THE AUTHORITY SHALL BE
EXEMPT FROM THE PAYMENT OF CORPORATE INCOME TAXES, THE
AUTHORITY SHAL LIKEWISE BE EXEMPT FROM REALTY TAXES
IMPOSED BY THE NATIONAL GOVERNMENT OR ANY OF ITS POLITICAL
SUBDIVISONS, AGENCIES AND INTRUMENTALTIES: PROVIDED, THAT
NO TAX EXEMPTION HEREIN GRANTED SHALL EXTEND TO ANY
SUBSIDIARY WHICH MAY BE ORGANIZED BY THE AUTHORITY”.

“(B) AUTONOMY - THE CEBU PORT AUTHORITY SHALL BE
AUTONOMOUS OF ANY NATIONAL PORT BODY, WHETHER EXISTING
OR CREATED HEREAFTER. THE AUTHORITY SHALL LIKEWISE ENJOY
FULL FISCAL AUTONOMY.” (n)

SEC. 2. Section 7 (b) and (f) of the same Act are hereby amended to read as
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follows:

“(p) Prescribe its by-laws and such rules and regulations as may be
found necessary to promote or enhance the business of the Authority, WHICH
SHALL INCLUDE BUT NOT LIMITED TO THOSE PERTAINING TO
PILOTAGE, CARGO-HANDLING, SECURITY AND OTHERS,”

XXX

"() Acquire, own, hire, use, operate and dispose of personal property
and to acquire, own, use, lease, operate and dispose of real property and
interests thereon and to make improvements on such real property, including
the reclamation, for port purposes, of foreshore and submerged lands within
its territorial jurisdiction; which reclaimed land shall ipso facto be deemed
transferred in ownership to the Authority; and to enter into contracts with any
public or private entity for such reclamation under such terms and conditions
as it may deem to be for the public interest; PROVIDED FURTHER, THAT
EXISTING OR FUTURE FORESHORE LEASE AGREEMENTS (FLA) OR
SIMILAR PERMITS DEVOTED TO PORT DEVELOPMENT OR PORT
OPERATION SHALL BE TRANSFERRED TO AND OWNED BY THE
AUTHORITY UPON THE EXPIRATION OF THE FORESHORE LEASE OR
PERMIT.

SEC. 3. Section 7 of the same Act is hereby further amended by adding
subsections (N), (©) and (P) to read as follows:

“(N) POLICE AUTHORITY WITHIN THE PORTS ADMINISTERED BY
IT AS MAY BE NECESSARY TO GARRY OUT ITS POWERS AND
FUNCTIONS AND ATTAIN ITS PURPOSES AND OBJECTIVES WITHOUT
PREJUDICE TO THE EXERCISE OF THE FUNCTIONS OF THE BUREAU
OF CUSTOMS AND OTHER LAW ENFORCEMENT BODIES WITHIN THE
AREA SUCH POLICE AUTHORITY SHALL INCLUDE THE FOLLOWING:

“(.) TO PROVIDE SECURITY TO CARGOES, PORT
EQUIPMENT, STRUCTURE, FACILITIES, PERSONNEL, AND
DOCUMENTS; PROVIDED, HOWEVER, THAT IN THE PORTS OF
ENTRY, PHYSICAL SECURITY TO IMPORT AND EXPORT
CARGOES SHALL BE EXERCISED JOINTLY WITH THE BUREAU OF
CUSTOMS;



“@i.) TO REGULATE THE! ENTRY TO, EXIT FROM, AND
MOVEMENT WITH THE PORT, OF PERSONS AND VEHICLES, AS
WELL AS THE MOVEMENT WITHIN THE PORT OF WATERCRAFT,
“(iii.) TO MAINTAIN PEACE] AND ORDER INSIDE THE PORT,
IN COORDINATION WITH THE LOCAL POLICE AUTHORITIES;
“(iv.) TO SUPERVISE PRIVATE SECURITY AGENCIES
OPERATING WITHIN THE PORT AREA;
“(v.) TO DEPUTIZE OTHER LAW ENFORCEMENT AGENCIES
TO ASSIST THE AUTHORITY IN THE ENFORCEMENT OF ITS
ORDERS, DIRECTIVES, POLICIES, AND RULES AND
REGULATIONS;
“(i) TO ENFORCE |RULES AND REGULATIONS
PROMULGATED BY THE AUTHORITY PURSUANT TO LAW.”
“(Q) TO CONTROL, REGULATE, AND SUPERVISE PILOTAGE AND
THE CONDUCT OF PILOTS IN THE PORTS WITHIN ITS TERRITORIAL
JURISDICTION.”
“(P) TO CONDUCT MAINTENANCE DREDGING OF THE PORT(S).
AND ITS APPROACHES OR WHERE DREDGING IS NECESSARY FOR A
PORT PROJECT OR PORT DEVELOPMENT, ON ITS OWN OR THRU THE
PRIVATE SECTOR, PROVIDED THAT SILT/DREDGED MATERIALS SHALL
BE DISPOSED IN AN AREA DEEMED BY THE AUTHORITY TO BE
SUITABLE AND WILL NOT POSE A HAZARD TO NAVIGATION; PROVIDED,
FURTHER THAT NOTICE SHALL BE GIVEN TO THE DEPARTMENT OF
ENVIRONMENT AND NATURAL | RESOURCES (DENR) FOR
COORDINATION PURPOSES.

SEC. 4. Subsections (h), (I), and (j) of Section 9 of the same Act are hereby
amended to read as follows:

“(h) To determine the organization of the Authority, REORGANIZED
OR ABOLISH OFFICES, and create such functional units, therein as it may
deem necessary in the proper and efficient implementation of the functions
and purposes of the Authority, including the appointment of officials and
employees, PROVIDED, THAT, THE AUTHORITY MAY ESTABLISH AN
EARLY RETIREMENT PLAN FOR ITS OFFICIALS AND EMPLOYEES AND



THAT ANY OFFICIAL OR EMPLOYEE WHO OPTS TO RETIRE SHALL BE
GRANTED NOT LESS THAN TWO (2) MONTHS BASIC PAY FOR EVERY
YEAR OF SERVICE IN ADDITION TO THE BENEFITS UNDER EXISTING
RETIREMENT LAWS, AND THOSE WHO ARE PHASED OUT BY REASON
OF ANY REORGANIZATION OF OFFICE SHALL BE GRANTED NOT LESS
THAN THREE (3) MONTHS BASIC PAY FOR EVERY YEAR OF SERVICE.

“(i) To define the duties and fix, REVIEW, OR REVISE the
compensation and benefits of the officers and EMPLOYEES of the Authority
COMPARABLE TO THOSE OF SIMILAR POSITIONS IN OTHER
GOVERNMENT OWNED AND CONTROLLED CORPORATIONS, THE
PROVISIONS OF EXISTING RULES AND REGULATIONS AND WAGE AND
POSITION CLASSIFICATION NOTWITHSTANDING ALL POSITIONS IN THE
AUTHORITY SHALL BE GOVERNED BY A COMPENSATION POSITION
CLASSIFICATION AND QUALIFICATION STANDARD APPROVED BY THE
CEBU PORT COMMISSION BASED ON A COMPREHENSIVE JOB
ANALYSIS AND AUDIT OF THE ACTUAL DUTIES AND RESPONSIBILITIES.
THE COMPENSATION PLAN SHALL BE COMPARABLE WITH THE
COMPENSATION PLANS IN THE) PRIVATE SECTOR WITHOUT
PREJUDICE TO YEARLY MERIT INCREASE BASED ON PRODUCTIVITY
AND PROFITABILITY. THE AUTHORITY SHALL THEREFORE BE EXEMPT
FROM REPUBLIC ACT 6758 OR ANY FUTURE SALARY
STANDARDIZATION LAW AS WELL AS ATTRITION LAW WHICH MAY
HEREAFTER BE ENACTED.”

“(j) TO PREPARE AND ADOPT ANNUAL ESTIMATES OF INCOME
AND EXPENDITURES AND ESTIMATES OF CAPITAL EXPENDITURE OF
THE AUTHORITY FOR THE ENSUING YEAR AND APPROVE ITS ANNUAL
BUDGET and/or such supplemental budgets thereof as may be submitted by
the General Manager from time to time;

SEC. 5. Section 9 of the same Act is| hereby amended by redesignating
subsections (K) to (L) and inserting a new subsection (K) to read as follows:

(kK) TO ISSUE CEASE AND DESIST ORDERS AGAINST ANY

PERSON OR ENTITY THAT OPERATES A PORT OR ENGAGES IN PORT

OPERATIONS AND OTHER PORT RELATED ACTIVITIES WITHOUT



HAVING FIRST SECURED A PERMIT AND/OR ACCREDITATION FROM
THE AUTHORITY OR IN VIOLATION OF THE RULES AND REGULATIONS
OF THE AUTHORITY”

SEC. 6. Section 10 of the same Act is hereby further amended to read as
follows:

“SEC. 10. Term of Office. - The members of the Cebu Port
Commission, EXCEPT FOR THE GENERAL MANAGER who shall have a
term of Six (6) years, shall be CO-TERMINUS WITH THE APPOINTING
AUTHORITY. PROVIDED THAT ALL COMMISSIONERS MUST BE
REGISTERED VOTERS OF CEBU AND ACTUAL RESIDENTS THEREOF
PRIOR TO THEIR APPOINTMENT.

SEC. 7. Section 15 of the same Act is hereby amended to read as follows:
“SEC. 15. Supplies and Services Other Than Personal. - All
purchases or contracts for services, except for personal service, entered into
by the Authority shall be done after public bidding therefor is held: Provided,
That such bidding may NOT be required when an emergency, as explained
and certified to by the General Manager, requires immediate delivery of the
supplies or performance of the services| and the unit cost or prices of such
emergency procurement do not exceed the latest costs or prices paid by the
Authority for the same or similar goods of services: Provided, further, That the
General Manager shall report under oath to the Commission the details of any
such emergency procurement within two (2) weeks after its consummation,
including a statement of assurance thatthe transaction constitutes the best

arrangement possible under the circumstances.”

SEC. 8. Section 19 of the same Act is hereby amended to read as follows:
SEC. 19. Bond Limits. - The bonds that may be issued by the
‘Authority shall in no case exceed the total [amount of One billion pesos
(P1,000,000,000.00)] VALUE OF ALL ITS EXISITING ASSETS: Provided,
That no single issue shall be made if at least seventy percent (70%) of the
immediately preceding issue is not yet sald.
“The bonds shall be issued only in such amounts as will be needed at



only one (1) integral operation not exceeding one (1) year duration, taking into
account the state at which said bonds may be absorbed by the buying public
and the fund requirements of the project ready for execution, and considering
further a proper balance between ieee and nonproductive projects so

that inflation shall be held to a minimum.”

SEC. 9. MODE OF GRANTING cofrnacrs OR PERMITS. - TO
PROMOTE TRANSPARENCY, ALL CONTRACTS OR PERMITS FOR THE
OPERATION AND MANAGEMENT OF CARGO. ana SERVICES SHALL BE
GRANTED BY THE AUTHORITY UPON A MANDATORY PUBLIC HEARING OF
APPLICATIONS FOR SUCH CONTRACT OR) PERMITS TO DETERMINE THE
FITNESS AND QUALIFICATIONS OF APPLICANTS BASED ON THE
QUALIFICATION STANDARDS, WHICH SHALL INCLUDE FINANCIAL
RESOURCES, EQUIPMENT AND OTHER CARGO HANDLING GEARS FOR
SAFE, EFFECTIVE AND EFFICIENT CARGO HANDLING SERVICES, TO BE
PRESCRIBED BY THE AUTHORITY. CONTRACTS OR PERMITS GRANTED
WIITHOUT PUBLIC HEARING SHALL BE NULLAND VOID.

ALL CARGO HANDLING SERVICE RROVIDERS, WHICH ARE DULY
REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION AND
HAVE PERFORMED CARGO HANDLING SERVICES FOR MORE THAN TWO (2)
YEARS SINCE 1997 AS AN AFFILIATE a CARGO HANDLING SERVICE
PROVIDERS WITH CONTRACTS OR PERMITS PREVIOUSLY ISSUED BY THE
PHILLIPPINE PORTS AUTHORITY OR WITH “HOLD-OVER PERMITS” FROM THE
CEBU PORT AUTHORITY, SHALL BE GRANTED CONTRACT OR PERMITS AS
CARGO HANDLERS TO OPERATE IN THE PORT WITHOUT PUBLIC HEARING
BUT UPON A PERFORMANCE AND FINANCIAL AUDIT INDICATING THEIR
EFFICIENCY AND CAPABILITY AND PROVIDED THEY MEET THE
QUALIFICATIONS STANDARDS PERECRIBED BY THE AUTHORITY.

A SHIPPING LINE OR SHIP OWNER UPON PRIOR APPROVAL OF THE
AUTHORITY, SHALL HAVE THE RIGHT TO CHOOSE OR CHANGE HIS CARGO
HANDLING SERVICE PROVIDER AT ANY TIME TO PREVENT DISRUPTION OF
HIS BUSINESS IN CASE THE PRESENT CARGO HANDLING SERVICE
PROVIDER UNDER CONTRACT SHALL HAVE A LABOR DISPUTE WITH HIS
DOCK WORKERS; OTHERWISE, THE ED as SHALL IMMEDIATELY TAKE


OVER THE CARGO HANDLING OPERATION IN THE INTEREST OF THE PUBLIC.

SEC. 10. WITHDRAWAL OF EXEMPTION FROM PAYMENT OF DUES,
FEES AND CHARGES. - NOTWITHSTANDING ANY PROVISION OF LAW TO THE.
CONTRARY, EXEMPTION FROM DUES, FEES, CHARGES AND OTHER SUMS.
GRANTED TO OR PRESENTLY ENJOYED BY ANY PERSON, WHETHER
NATURAL OR JURIDICAL, IS HEREBY WITHDRAWN UPON THE EFFECTIVITY
OF THESE AMENDMENTS.

SEC. 11. EXEMPTION/REDUCTION OF DUES, RATES OR CHARGES. -
THE CEBU PORT COMMISSION MAY WAIVE OR REDUCE DUES, RATES OR
CHARGES BEING IMPOSED, UNDER SUCH TERMS AND CONDITIONS AS IT
MAY DEEM NECESSARY.

SEC. 12. PENALTY. - ANY PERSON WHO VIOLATES THE PROVISION OF
THIS ACT OR ANY RULES AND REGULATIONS OF THE AUTHORITY SHALL BE
PUNISHED BY A FINE OF NOT LESS THAN FIVE THOUSAND PESOS (P5,000.00)
BUT NO MORE THAN TWO HUNDRED THOUSAND PESOS (200,000.00) OR
SUFFER IMPRISONMENT OF NOT LESS THAN ONE (1) MONTH BUT NOT
MORE THAN SIX (6) MONTHS OR BOTH AT THE DISCRETION OF THE COURT.
IN CASE THE VIOLATION IS COMMITTED BY A CORPORATION, COMPANY OR
ENTITY, ITS DIRECTORS, OWNERS, MANAGERS SHALL LIKEWISE BE LIABLE
FOR SUCH VIOLATION.

SEC. 13. NO RESTRAINING ORDER/INJUNCTION. - NO OFFICE OR
COURT, EXCEPT THE SUPREME COURT, MAY ISSUE A TEMPORARY
RESTRAINING ORDER OR WRIT OF PRELIMINARY INJUNCTION OR ANY
INJUNCTIVE WRIT AND/OR CEASE AND DESIST ORDER AGAINST THE
AUTHORITY IN CONNECTION WITH ITS OPERATION AS A PUBLIC UTILITY,
INCLUDING ARRASTE & STEVEDORING, AND AS REGARDS ANY OF ITS
INFRASTRUCTURE PROJECTS.”

SEC. 14. Separability Clause. - If any provisions of this Act or the application
of such provision to any person or circumstance is declared unconstitutional, the


remainder of this Act or the application of such provision to other persons or
circumstances shall not be affected by such declaration.

SEC. 15. Repealing Clause. - All laws, executive orders, letters of
instructions, rules and regulations, or provisions thereof which are inconsistent with
the provisions of this Act are hereby repealed, amended or modified accordingly.

SEC. 16. Effectivity Clause. - This Act shall take effect fifteen (15) days after
its publication in the Official Gazette or in at least two (2) national newspapers of

general circulation.

Approved,