THIRTEENTH CONGRESS OF THE REPUBLIC 
) 
, 
1 
~- 
OF THE PHILIPPINES 
First Regular Session 
1 
S. No. 
Introduced by Senator S. R. OsmeAa 111 
EXPLANATORY NOTE 
This bill proposes the creation of Autonomous Port Authorities (APAs) all 
over the country which will be subsidiaries of the Philippine Ports Authority 
(PPA), and subject to the supervision of the latter for purposes of regulation, 
policy making , planning and development. 
This happy compromise allows the government to ensure that the national 
perspective is reflected in port policy-making, planning and development, while at 
the same time accommodating the need on the part of local governments for 
greater autonomy in the administration of local public facilities. 
In effect, representation of local governments in the APA governing board 
will make the APAs accountable to their respective local constituencies as far as 
the delivery of services is concerned. However, the continuing regulatory and 
supervisory powers of the Philippine Ports Authority over the APA will ensure 
that developmental issues are addressed, 
and 
that appropriate market 
interventions are applied across various local port situations. 
Fiscal autonomy is also provided in the bill, where the APA is allowed to 
retain 95% of gross revenues or 65% of net income to finance the working capital 
requirement of the local port. 5% of gross revenues or 35% of net income which 
will be remitted to the PPA will constitute the APA's contribution to the 
developmental agenda of the countrywide port system. 
The most appealing 
argument to advance the devolution 
of service- 
oriented agencies has been the claim that local governments are better able 
to identity and address local needs. The most powerful deterrent has been 
the threat of fragmentation 
in policy-making. This bill seeks to achieve a 
workable compromise that will minimize the tradeoff between these two. 
In view of the foregoing, the immediate approval of this bill is earnestly 
requested. 
SERGIO OSMENA III 
Senator 


t ’  
THIRTEENTH CONGRESS OF THE REPUBLI 
First Regular Session 
OF THE PHILIPPINE 
I
_
 
R ECE h? 
S E N A T E  
S. No. 
Introduced by Senator S. R. Osmeiia 111 
AN ACT 
CREATING AUTONOMOUS PORT ADMINISTRATIONS [APAs], DEFINING 
THEIR POWERS AND FUNCTIONS, AND FOR OTHER PURPOSES 
Be it enacted by the Senate and the House of Representatives of the Philippines 
in Congress assembled: 
1 
SECTION 1. Title. This Act shall be known and cited as the “Philippine Ports 
2 
Autonomy Act”. 
3 
SEC. 2. 
Policy. - It is the declared policy of the State to promote the 
4 
establishment and growth of autonomous regional port bodies to produce an efficient, 
5 
safe, economical and coordinated system of transporting 
goods and persons 
6 
throughout the country, 
consistent with the constitutional mandate to pursue the 
7 
development of all the regions of the country. Towards this end, the State recognizes 
8 
the importance of a national agency mandated to ensure that all ports in the country 
9 
are part of a whole integrated port system, while ensuring that each port is focused on 
10 
delivering adequate port services in its respective local community 
in the most 
11 
efficient ways possible. 
12 
SEC. 3. 
Creafion of Aufonomous Port Adminisfrafion (APAs). - The 
13 
creation of Autonomous Port Administrations, 
hereinafter referred to as the APAs 
14 
which shall serve as autonomous corporate 
subsidiaries 
of the Philippine Ports 
15 
Authority (PPA), is hereby authorized subject to the provisions of this Act. 
1 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
(APAs) shall be under the supervision of 
regulation, policy coordination, planning 
Criteria 
for 
th 
Establishment of Autonomous 
Port 
may be established in a 
subject to the evaluation 
and recommendation of the PPA, based on a detailed feasibility and engineering 
study which must conform to the following criteria: 
(a) The proposed port must be identified as a regional growth center in the Medium 
Term Philippine Development Plan or by the Regional Development Council; 
(b) The area must have significant incremental advantage over existing ports, 
and its financial feasibility and potential profitability can be established; and 
(c) The area‘ must be strategically located 
Other pdrts which do not meet the foregoing criteria may be established as 
APAs: Provide‘d, That said port shall be developed only through local government 
andlor private sector initiative under any of the schemes allowed in Republic Act No. 
6957 (the build-operate-transfer law) and without any financial exposure on the part of 
the national government Provided, further, That after five (5) years the port must 
have attained a substantial degree of development, the indicators of which shall be 
formulated by the PPA. 
SEC. 5. Definition of Terms. - For purposes of this Act, unless the context 
indicates otherwise, the terms used herein shall mean as follows: 
a) 
“Authority” shall mean the Philippine Ports Authority established under PD 
505 and PD 857 as amended: 
‘Port facility” shall include wharves, piers, slips, docks, bulkheads, basins, 
warehouses, cold storage, loading and unloading equipment, and 
passenger terminals and accessories; 
“Transportation facility” includes passenger and cargo boats, ferry boats, 
lighters, tugs, barges, scows, harbor draft of any kind, and any other kind of 
2 
b) 
c) 


I 
facility now in use or hereafter designated for use of the transportation or 
2 
3 
4 
5 
6 
7 
8 
9 
10 
I1 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
carriage of persons or goods; 
d) 
“Navigable waters” means all navigable portions of the seas, estuaries and 
inland waterways; 
e) 
“Wharf’ means a continuous structure built parallel to or along the margin 
of the sea or alongside riverbanks, canals or other waterways where 
vessels may lie alongside to receive and discharge cargo or passenger, or 
lie at rest; 
“Pier” includes any stage, stair, landing stage, jetty, floating barge or 
f) 
pontoon, any bridge or other works connected therewith; 
g) 
“Dock” includes locks, cuts, entrances, graving docks, inclined planes, 
slipways, quays and other works relative thereto; 
“Bulkhead” means any structure serving to divide land and water areas; 
h) 
i) 
“Basin” means any naturally or artificially enclosed or nearly enclosed body 
of water in free communication with the sea; 
j) 
k) 
“Warehouse” means any building for storage or shed for cargo; 
“Lighter” means any large flat-bottomed boat or barge used in transporting 
goods, or in loading or unloading of vessels not lying alongside piers or 
wharves; 
I) 
“Anchorage” means any place with sufficient depth of water where vessels 
anchor or may ride at anchor within the harbor; 
m) “Goods” includes wares and merchandise of every description; 
n) 
“Rates” includes tolls, fees, dues and rent imposed by the Authority; 
0 )  “Vehicle” includes any carriage travelling on its own wheels or runners and 
used or intended to be used for the conveyance or carrying of persons, 
animals or goods; and 
p) 
“Vessels” includes any ship, boat or any water borne craft used in the 
conveyance or carrying of persons, animals or goods. 
3 


SEC. 6. Purposes and Objectives. The Autonomous Port Administrations 
I 
(APAs) shall have the following purposes and objectives: 
2 
a) 
To administer, manage and operate the port and terminals under its 
3 
jurisdiction; 
4 
b) 
To integrate and coordinate with the Authority the planning, development, 
5 
construction and operations of ports and port facilities and implementation 
6 
of policies and programs within its territorial jurisdiction, consistent with the 
7 
needs and requirements of their respective territorial jurisdiction; 
To enhance the flow of international and domestic commerce passing 
c) 
8 
9 
through or utilizing the regional ports; 
10 
d) 
To promote regional development by providing support services to sustain 
11 
the growth of export and other priority industries in the region; 
12 
13 
e) 
To serve as a link between inland areas and other ports in the country to 
foster efficient movement of people and goods; and, 
f) 
To establish mutually beneficial economic relations which other entities 
14 
15 
within the country, 
subject to the administrative guidance of the 
Department of Foreign 
Affairs 
and/or the Department of Trade and 
or, 
16 
17 
Industry, with foreign entities and enterprises. 
18 
g) 
To regulate private terminals within its jurisdiction, subject to the rules and 
19 
20 
21 
regulations that the Authority may formulate. 
SEC. 7. 
Terriforial jurisdicfion. The territorial jurisdiction of the APA shall 
include all seas, lakes, rivers, and all other navigable inland waterways within the city 
22 
or province, including waterways, the metes and bounds of which are to be delineated 
23 
24 
and more particularly described in a proclamation to be issued by the President of the 
Philippines, 
upon 
recommendation 
of the Authority, 
in coordination with the 
25 
municipal or city council, National Land Use Coordinating Committee and/or the 
26 
27 
28 
Regional Land Use Committee. 
SEC. 8. 
Powers. - The APA is hereby vested with the power to: 
4 


1 
2 
3 
4 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
a) Have perpetual succession under its corporate name until otherwise 
provided by law; 
b) Prescribe its by-laws and such rules and regulations as may be found 
necessary; 
c) Adopt and use a seal; 
d) Sue and be sued in any court; 
e) Enter into contracts, transactions, and undertakings of whatever nature, 
which are necessary or incidental to its functions and objectives, with any 
natural or juridical persons or with any government institutions, domestic or 
foreign: 
f) Acquire, own, hire, use, operate and dispose of personal property and to 
acquire, own, use, lease, operate and dispose of real property and interest 
thereon and make improvements on such real property, including the 
reclamation, for port purposes, of fore shore and submerged lands within its 
territorial jurisdiction; which reclaimed land shall ipso facto be deemed 
transferred in ownership to the Administration; 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; 
g) Purchase, hold, alienate, mortgage, pledge or otherwise dispose of the 
shares of the capital stock of, or any bond, security or other evidences of 
indebtedness created by any other corporation or co-partnership of this or 
any other country, and while the owner of said stock, to exercise all the rights 
of ownership, including the right to vote thereon; 
h) Exercise all other powers not contrary to law which may be necessary or 
incidental to the effectuation of its authorized purposes or to the exercise of 
nay of the foregoing powers, except the power to levy taxes or assessment 
and, in general, to exercise in connection with property within its control all 
powers which may be exercised by natural or juridical persons over its 
property and affairs; 
5 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
Levy dues and impose rates, charges for the use of the premises, works, 
appliances, facilities or for services provided by or belonging to the 
Administration, or any other organizations concerned with port operations, 
subject to uniform structures established by the Authority; 
Hire or contract experts and consultants, both foreign and local; and 
Exercise all powers of a corporation under the Corporation Law insofar as 
they are not inconsistent with the provision of this Act. 
SEC. 9. Powers of the Authority over APAs. - The Authority shall have 
regulatory power over APAs and shall prescribe rules and regulations necessary to this 
effect. The Authority shall also exercise the powers provided under Section 6 of PD 
857, as amended, which are not inconsistent with the provisions of this Act. 
SEC. 10. Obligafions. - The APAs shall remit to the Authority 5% of its gross 
monthly income or 35% of net monthly income, whichever is higher as its contribution 
to the overall development of the country’s integrated port system. The residual 
amount of 95% of gross monthly income of 65% of net income, whichever is lower 
shall be used by the APA to finance the working capital requirements of the local port. 
SEC. 1 I. Governing Body.. - The powers and functions of each APAs shall 
be vested in and exercised by a Port Commission composed of a Chairman, a Vice- 
Chairman and five (5) other Commissioners. 
The Chairman shall be the District 
Manager of the Authority. The Port Administrator shall act as Vice-chairman of the 
commission. 
The Commissioners shall be appointed by the PPA Board of Directors from the 
following sectors: 
a) Representative of the Province, nominated by the Governor; 
b) Representative of the City/Municipality, nominated by the Mayor; 
c) Shipping sector, nominated by the largest local Ship owners organization; 
d) Trade or business sectors, nominated by the largest local Business 
Organization; and 
e) Labor and other port sectors. 
6 


1 
SEC. 12. Powers and functions of the Commission. - The powers and 
2 
3 
a) To manage, administer, operate, maintain, improve and develop, coordinate 
4 
and otherwise govern the activities of all the ports within its territorial 
5 
jurisdiction; 
6 
b) In coordination and subject to final approval by the Authority, to investigate, 
7 
prepare, adopt, implement and execute a comprehensive and orderly plan 
8 
for the overall development of all the ports within its territorial jurisdiction, 
9 
and to update such plan, as may be required by the Authority from time to 
functions of each Port Commission shall be as follows: 
10 
time; 
11 
12 
13 
it; 
14 
1s 
16 
17 
18 
19 
20 
21 
22 
sector; 
23 
24 
2s 
26 
27 
28 
29 
c) To raise revenues for the APA through fees, tolls, charges, rentals and the 
like for the use of any property, equipment or facility owned and controlled by 
d) To raise and administer, together with such revenues as may by law accrue 
to the APA, capital outlays by means of loans from any local or foreign 
fin an ci a I institution to fin an ce its projects ; 
e) To determine by survey and established by engineering design the exact 
location, system and character of any and all port facilities which it may own, 
construct, establish, effectuate, operate or control; 
f) To provide and maintain port facilities including accessory buildings and 
installations within its territorial jurisdiction on its own or through the private 
g) To prescribe and enforce rules and regulations on the use of wharves, piers 
and anchorages by ships and other water craft; 
h) To determine the organization of the APA and create such functional units 
therein as it may deem necessary in the proper and efficient implementation 
of its functions and purposes, including the appointment of officials and 
employees, it being understood that the security of tenure of these workers 
shall be respected consistent with existing laws; 
7 


1 
i) To define the duties and fix the compensation and benefits of the Chairman, 
2 
Vice-chairman and the Commissioners of the Port Commission in 
3 
accordance with the rules and regulations of the Civil Service Commission 
4 
and the Department of Budget and Management; 
5 
j) To approve the annual budget of the APA and/or such supplemental budget 
6 
thereof as may be submitted by the APA from time to time; and 
7 
8 
k) To perform some other duties as may be necessary and convenient for the 
attainment of the objectives of the APA. 
9 
SEC. 13. Term of office. - Except for the chairman and vice-chairman, the 
10 
I 1  
members of each Autonomous Port Commission shall be appointed for a term of three 
(3) years; Provided, That any person appointed to fill a vacancy shall hold office only 
12 
for the unexpired term of the Commissioner whom he succeeds. 
13 
SEC. 14. Quorum, f e r  Diems and AIlowances. - Four (4) members of the 
14 
15 
16 
Commission shall constitute a quorum for the transaction of business. 
Unless otherwise fixed by the Commission, the Chairman and all the members 
shall each received a per diem of Two Thousand Pesos (P2,OOO) or such amount as 
17 
maybe authorized by the Authority, exclusive of travelling expenses, for each day of 
18 
19 
SEC. 15. Port Administrator. - The management of the day-to-day business 
meeting of the Commission, which shall not exceed four (4) meetings a month. 
20 
and operations of the APA shall be under the direction and control of the Port 
21 
Administrator who shall be appointed by the PPA Board of Directors. His duties and 
22 
responsibilities are: 
23 
24 
a) To keep secure all port properties and activities within its jurisdiction; 
b) To manage, direct and supervise the operations and internal administration 
25 
of the APA, subject to the control and supervision of the Commission; 
26 
c) To prepare all memoranda pertaining to each and every item in the agenda 
27 
for the meetings of the Commission and to submit for the consideration 
28 
thereof such proposals or recommendation which he believes to be 
29 
necessary to carry out effectively and beneficially the business of the APA; 
8 


7 
2 
3 
4 
5 
6 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
d) To implement the policies and administer the measures approved by the 
Commission; 
e) To devise the executive organization pattern of the APA, submit from time to 
time to the Commission the corresponding organizational and functional 
charts, and enforce the executive elements thereof; 
f) To appoint and employ the services of subordinate officials and employees, 
subject to the confirmation of the Commission; 
g) To prepare and submit to the Commission, budget proposals of all kinds; and 
h) To perform such other duties and exercise such other powers as may be 
directed or authorized specifically by the Commission. 
SEC. 16. Prohibition Against Conflict of lnterest. - No member of the 
Commission shall be financially interested, directly or indirectly, in any contract entered 
into by the APA or in any special privilege granted by it. Violation of this prohibition 
shall constitute a ground for dismissal. 
SEC. 17. Appoinfment of Personnel. - 
All officers and employees of the 
APA shall be subject to the Civil Service Commission and the Department of Budget 
and Management rules and regulations, except those whose positions may, upon 
recommendation of the Port Commission, thru the Authority, be declared by the 
President of the Philippines as policy determining, primarily confidential or highly 
technical in nature. 
SEC. 18. Capitalization. - The APA shall have an authorized capital stock 
equal to and consisting of: 
a) The value of fixed assets, including port facilities and equipment 
administered by or belonging to the autonomous ports and such other 
properties, movable and immovable, within the territorial jurisdiction of the 
APA as defined in Section 5 hereof, valued on the date of effectivity of this 
Act; and, 
b) Government contribution in such amount as may be deemed an appropriate 
initial balance. Such initial amount, as approved by the President of the 
9 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
Philippines, shall be more or less equivalent to six (6) months working capital 
requirement of the APA. 
SEC. 19. Auditor and Personnel. - The Commission on Audit shall appoint 
a representative who shall be the Auditor of the APA and the necessary personnel to 
assist said representative in the performance of his duties. The operating expenses of 
the auditing office and the salaries of both officials and employees shall be paid by the 
APA. 
SEC. 
20. 
Power to /ssue Bonds. - 
The power of the APA to incur 
indebtedness or to issue bonds to carry out approved capital investment projects, shall 
be subject to approval by the affirmative vote of at least five (5) members of the Port 
Commission in a special meeting called for the purposes and approved by the 
President of the Philippines upon the recommendation of the Secretary of Finance and 
the Bangko Sentral ng Pilipinas, thru the Authority. 
SEC. 21. Bond Limits. - The bonds that may be issued by the APA shall in 
no case exceed the total amount of One Billion Pesos (PI ,000,000,000.00): Provided, 
that no single issue shall be made if at least seventy percent (70%) of the immediately 
preceding issue is not yet sold. 
The bonds shall be issued only in such amounts as will be needed at only one 
(1) integral operation not exceeding one (I) 
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 
productive and non-productive projects so that inflation shall be held to a minimum. 
SEC. 22. Form, Rate of Interest, efc. of Bonds. - The Secretary of Finance, 
in consultation with the Monetary Board, shall prescribe the form, rate of interest, 
denominations, maturities, negotiability, convertibility, call and redemption, features, 
and all other terms and conditions of issuances, placement, sale, servicing, redemption 
and payment of all bonds issued under the provision of this Act. 
10 


I 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
The bonds issued by virtue of this Act shall be made payable both as to principal 
and interest in Philippine currency and shall be acceptable as security in any 
transaction with the government in which such security is required. 
SEC. 23. Transfer of Existing Facilities and Intangible Assefs. All existing 
facilities including wharves, piers, slips, dock, bulkheads, basins, cargo terminals, 
warehouses, cold storage, loading/unloading equipment, and passenger terminals and 
accessories, within the territorial jurisdiction of the APA; other lands, buildings and 
other properties, movable and immovable, belonging to or presently administered by 
the Authority; and all assets, powers, rights, interests and privileges relating to port 
works or operations, including all equipment, shall be transferred by the Authority to the 
APA, and shall constitute the equity investment of the PPA in the APA except for such 
properties reserved for use by a Port District Management Office. 
SEC. 
24. 
Project in Progress. 
- 
All ongoing projects relating to the 
rehabilitation and/or construction of port facilities and supply of equipment shall be 
administered and undertaken by the APA. 
SEC. 25. Transfer of Liabilities and Debts. - 
Upon the transfer to and 
acceptance by the APA of the existing physical facilities, intangible assets and 
completed projects referred to in the preceding sections, all debts, liabilities and 
obligations of the Authority in respect of such physical facilities, tangible assets and 
completed projects within the port shall likewise be assumed by the APA. 
SEC. 26. Absorption of Affected Port Management Offices and Head 
Office Units/Port District Office. - The affected Port Management Offices shall be 
absorbed into the APA upon its activation. The Port Administrator of each APA thus 
activated shall ensure the smooth transfer of responsibilities 
from the Port 
Management Office to the APA; Provided, That all officials and employees in the Port 
Management Offices shall be absorbed in their current positions by the APA or 
transferred in other assignments in the Authority 
SEC. 27. Annual Report. - An annual report of the APA shall be submitted 
to the Authority within ninety (90) days after the close of each fiscal year. 


I 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
The originals of said report shall be submitted to the Authority and copies 
thereof to the President of the Philippines, and the Department of Transportation and 
Communications. The report shall include a financial statement duly certified by the 
Auditor of the APA. 
SEC. 28. Appropriation. - The amount necessary to carry out the provisions 
of this Act shall be included in the Annual Corporate Budget of the Autonomous Port 
Administrations (APAs) subject to the approval of the Port Commission. Gratuities, 
retirement and other benefits due to PPA officials and employees who will be 
terminated due to the enactment of this Act shall be included in the PPA’s corporate 
budget. 
SEC. 29. Fiscal Autonomy. - The APA shall have fiscal autonomy and shall 
comply with the rules and regulations provided by the Authority to this effect. 
SEC. 30. Transifory Provisions. - 
Within 120 days from effectivity of this 
Act, the Philippine Ports Authority shall submit to the PPA Board of Directors a list of 
Port Management Offices to be devolved to APAs through Presidential Proclamation, 
as provided in Sec. 4. The Authority shall schedule the activation of approved APAs 
one year from the effectivity of this Act. Thereafter, the Authority may submit thru its 
Board of Directors the creation of APAs for Presidential Proclamation as the need 
arises. 
SEC. 
31. 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. 
32. Repealing Clause. - 
All acts, charters, executive orders, 
administrative orders, rules and regulations or parts thereof, in conflict with this Act are 
hereby repealed or modified accordingly. 
SEC. 33. Effectivity Clause. - This Act shall take effect fifteen (15) days after 
its publication in at least two (2) national newspapers of general circulation. 
Approved, 
12