SIXTEENTH CONGRESS OF THE)
REPUBLIC OF THE PHILIPPINES)
First Regular Session )

HOUSE of REPRESENTATIVES
Hoiise Bill No. 8.18

Introduced by: MA. THERESA B. BONOAN
4" Dis

EXPLANATORY NOTE

he City of Manila has Manila de bay, a national wealth, in its
territorial jurisdiction. The bay is considered to be one of the best natural
harbours in Southeast Asia and one of the finest in the world. Manila
Bay is a natural harbour which serves the Port of Manila (on Luzon), in
the Philippines. It facilitated commerce and trade between the Philippines
and its neighboring countries, becoming the gateway for socio-economic
development even prior to Spanish occupation

It is provided in the Constitution that the City of Manila shall be
entitled to an equitable share in the proceeds of the national wealth as well
in the utilization and development of it. Manila was never given a share
in the income from its own national wealth. After 40 years of taking away
of its Constitutional right, Manila is in now fighting not only for its share
on the income on the port harbors, Manila is now fighting for its very
existence for it has been financially cash strapped hardly could pay the
salaries of its employees and its obligations, affecting the quality of its
public service

This bill seeks to establish the Manila Ports and Special Economic
Region (MP-SER) separating its ports and economic area from the
Philippine Ports Authority (PPA) system. The Bill returns to Manila its
Constitutional right and privilege in its share in the income from the port
harbor and in the participation in the planning and development of it.

The Manila Ports and Special Economic Region shall be managed
and operated by the Administration which shall be known as MP-SERA.
It is an administration of multi-sectoral representation coming from the
national government from PPA and Philippine Navy, local government
unit, investors, private sector, and worker working in the port area. It is
believed by the proponent that it is in involving the different stakeholders
of the ports can we induce great and brilliant ideas to be able to develop
Manila Ports into a world class port facility and create a special economic


area with a goal of providing sustained high annual economic growth
through an efficient and graft free administration, delivering safe, efficient
and effective port services, administering sympathetic concern for the
problems of businesses, prescribing responsible environmental
stewardship, and exerting exemplary public service.

The government can utilize this high economic growth in terms of
its income in the implementation of its programs and projects in providing
better social services with end objective of improving the lives of
Manilefios and our Filipino brothers and sisters. This will also spawn
economic activity in the area and generate jobs for the people, increase
their productivity and individual incomes, and improve the level and
quality of their living conditions

In a timely pursuit in helping and supporting the National
Government of its vision to give more programs and services to the
Filipino people, the proposed measure ensures all taxes are paid in
congruence with the rules and regulations of the Bangko Sentral ng
Pilipinas (BSP), the Department of Finance (DOF), the Bureau of
Customs (BOC) and Department of Trade and Industry (DTD, in
accordance with the National Internal Revenue Code (NIRC) of 1997, as
amended, and the Tariff and Customs Code of the Philippines. It also
prescribes additional earnings for the National Government of more or
less Two billion pesos (P2,000,000,000.00) per year from its 50% share
based on the Net Income of MP-SERA’s port revenues and from payment
of Income Tax.

and a

With the ultimate goal of having globally competitive po
special economic located along Manila Bay effectively and efficiently
serving world markets and major multinational corporations to achieve the
high rate of annual economic growth of our country and of the City of
Manila, the early passage of this bill is earnestly requested

HON. MA. THERESA B, BONOAN
4th District, City of Manila


SIXTEENTH CONGRESS OF THE i
REPUBLIC OF THE PHILIPPINES _)
First Regular Session )

HOUSE of REPRESENTATIVES
House Bill No.8.

Introduced by: MA. THERESA B. BONOAN
_4" Distriot, City of Manila

AN ACT ESTABLISHING THE MANILA PORTS AND SPECIAL
ECONOMIC REGION (MPSER) CREATING FOR THE PURPOSE
THE MANILA PORTS AND SPECIAL ECONOMIC REGION
ADMINISTRATION (MPSERA), APPROPRIATING FUNDS
THEREFOR AND FOR OTHER PURPOSES

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

SECTION 1. SHORT TITLE. - THIS ACT SHALL BE
KNOWN AS THE "MANILA PORT AND SPECIAL ECONOMIC REGION
ACT OF 2013”.

SECTION 2. DECLARATION OF POLICY. ~
A) Local Goyernments shall be entitled to an equitable share in the
proceeds of the utilization and development of the national wealth
within their respective areas, in the manner provided by law,
including sharing the same with the inhabitants by way of direct
benefits, (Sec. 7 Art. X of the Constitution)

B) "The State recognizes the indispensible role of the private sector,
encourages private enterprise, and provides incentives to needed
investments." (Sec. 20, Art II)

C) It is hereby declared the policy of the state shall promote a just and
dynamic social order that will ensure the prosperity and
independence of the nation and free the people from poverty
through policies that provide adequate social services, promote full
employment, a rising standard of living, and an improved quality of
life for all. (Sec. 9 Art. 2 of the Constitution)


D) “the State shall protect and advance the right of the people to a
balanced and healthful ecology in accord with the rhythm and
harmony of nature,” (Article II, Section 16 of the Constitution)

SECTION 3. DEFINITIONS:

e "ANCHORAGE" means a place with sufficient depth of water
where vessels anchor or may ride at anchor or may ride at anchor
within the harbor.

e "BASIN" means a naturally or artificially enclosed or nearly
enclosed body of water in free communication with the sea.

¢ "DOCK" includes locks, cuts, entrances, graving docks, inclined
planes, slipways, quays, and other works and things appertaining to
any dock

e DOCKAGE FE Dockage or berthing fee is the amount
assessed against a vessel engaged in international (foreign) trade for
berthing. It is levied on cargo vessels based on the number of days
of stay for the purpose of discharging and/or loading cargo; and on
non-cargo vessels for the purpose of loading and/or taking
passengers or for taking fresh water supply or receiving bunker
fuel.

e¢ "DRYDOCK" means a dock from which the water can be
temporarily excluded, in order to effect repairs to hulls and keels of
ships or vessels,

¢ "DUES" includes harbor fees, tonnage and wharfage dues,
berthing charges, and port dues and any other dues or fees imposed
by virtue of existing law or PD 857

e "ENTRE PORT" provider of services such as whole sailing,
warehousing, sorting, processing, credit, currency exchange, risk
management, ship repair, provisioning, business information,
adjudication of commercial disputes.

e¢ "FUNCTIONS" includes powers and duties.

e "GOODS" includes animals, carcasses, baggage, and any movable
property of any kind.


LAY-UP FEES — This pertains to the amount assessed against
vessels engaged in coastal (domestic) trade that are authorized to
temporarily lay-up and anchor at any port.

"LIGHTER" means a flat-bottomed boat or barge used in loading
or unloading cargo to or from vessels,

"NAVIGABLE WATERS" means all navigable portions of the
seas, estuaries, and inland waterways.

“NET EARNINGS” shall mean income derived from whatever
source, whether exempt or subject to tax, net of deductions allowed
under Section 29 of the National Internal Revenue Code, as
amended, and income tax and other taxes paid thereon, but in no
case shall any reserve for whatever purpose be allowed as a
deduction from net earnings.

"PTER" means any structure built into the sea but not parallel to
the coast line and includes any stage, stair, landing place, landing
stage, jetty, floating barge or pontoon, and any bridge or other
works connected therewith.

PILOTAGE - This represents the government share on the service
rendered or required to be performed by the harbor pilots to
maneuver vessels to/from the ports as required or as deemed
ne ry in each pilotage district.

"PORT" means a place where ships may anchor or tie up for the
purpose of shelter, repair, loading or discharge of cargo, or for other
such activities connected with water-borne commerce, and
including all the land and water areas and the structures, equipment
and facilities related to these functions.

"PORT DISTRICT" means the territorial jurisdiction under the
control, supervision or ownership of the MP-SERA over an area
(land or sea).

PORT DUES ~ Vessels engaged in foreign trade, including those
engaged in barter trade, that enter any port, whether private or
government-owned, for loading and discharging cargoes,
embarking/disembarking passengers, bunkering or __ taking


provisions or repairs and changing members of the crew are
charged with port dues based on the vessel gross revenue tonnage
(GRT). It is a one-time charge assessed against vessels anytime
that they call at the port.

PORT USAGE FEES -~ Vessels engaged in coastal domestic trade
that berth or temporarily lay up or drop anchor at any government
port are charged a port usage fee based on gross revenue ton (GRT).

"RATES" means any rates or charges including any toll or rent
under existing law or imposed by the Authority by virtue of this
Decree for facilities used or services rendered,

RETAINED EARNINGS — This account represents the recorded
cumulative net profit of the MP-SERA from the start of its
operation, net of the net income tax.

SHARE IN ARRASTRE / STEVEDORING INCOME ~ This
account represents the MP-SERA share on the receipts or earnings
of cargo handlers from arrastre and stevedoring service. Arrastre
refers to the set of shore-based cargo handling activities that
includes, but is not limited to, the receiving or loading of cargoes
to/from ship’s tackle with the use of dock gang and cargo handling
equipment. On the other hand, stevedoring service covers the
discharging and loading of containers, loaded or empty, from vessel
to the dock/apron and vice-versa, and the opening and closing of
hatch covers, lids and supporting beams.

The account includes income from MICT, South Harbor and North
Harbor operations and other port district

STORAGE CHARGES ~ Storage fees are charges on cargoes that
remain in the cargo sheds, warehouses or in the open storage area of
any government-owned port beyond the “free storage period”
allowed. Increase or decrease in storage revenue can be attributed
to the growth or decline in the number of shippers/port users
availing of storage services.

"TERMINAL FACILITY" includes the seaport and its facilities
of wharves, piers, slips, docks, dry docks, bulkheads, basins,
warehouses, cold storage, and loading or unloading equipment.


TERMINAL FEES ~ The account consists of the amount charge
on vehicles for the use of the port facilities and services which is
collected by the PPA on a per sea-leg journey at the port of loading
or embarkation.

"TRANSPORTATION FACILITY" includes rails and railcars,
highways, wheeled vehicles, bridges, tunnels, tramways, subways,
passenger or cargo vessels, ferry-boats, lighters, tugs, barges,
scows, ramps, and any kind of facility in use or for use of the
transportation, movement, or carriage of goods or passengers.

"TRANSIT SHED" means a building or shed which is situated at
or near a quay, wharf or pier, and is used for the temporary or short-
term storage of goods in transit, or to be shipped or discharge from
a vessel

"VESSEL" includes any ship or boat, or any description of a
vessel or boat

VESSEL TRAFFIC MANAGEMENT SERVICE FEE
Deemed adopted by MP-SERA the PPA Administrative Order No,
03-2006 dated 16 June 2006 authorizing the collection of the Vessel
Traffic Management Service (VITMS) Fé It includes fees
collected/ass din all international and domestic v
departing, navigating, operating, and anchoring/mooring within the
VTMS covered areas.

els entering,

"WAREHOUSE" means a building or shed used for the storage of
cargo.

"WHARE" means a continuous structure built parallel to along the
margin of the sea or alongside riverbanks, canals or waterways
where vessels may lie alongside to receive or discharge cargo,
embark or disembark passengers, or lie at rest.

WHARFAGE DUES — This refers to the charges levied on
loaded/unloaded cargoes whether imports, exports, inbound,
outbound, or transshipments. The computation is based on metric
ton for non-containerized cargoes and per box for containerized
cargoes.


SECTION 4. CREATION OF THE MANILA PORTS
AND SPECIAL ECONOMIC REGION. - a) There is hereby
established a Manila Ports and Special Economic REGION, a public-
benefit corporation, in the City of Manila, the capital of the Philippines
and center of trade and commerce of our country, hereinafter referred to
as the “MP-SER”. The specific metes and bounds of the MP-SER shall
be where Manila de Bay and the lands along said bay within the territorial
boundary of Manila between Pasay and Nayotas

b) The Principal Office of the MP-SER shall be located inside the Manila
Port and Special Economic Region.

SECTION 5. GOVERNING PRINCIPLES. - The MP-SER
shall be managed and operated by the Manila Ports and Special
Economic Region Administration, hereinafter referred to as the MP-
SERA, under the following principles:

a) Within the framework and limitations of the Constitution, the MP-
SER shall be developed into and operated as a decentralized, self-
reliant and self-sustaining port/economic area serving world
markets and major multinational corporations into becoming one of
the world’s busiest ports and successful economic region focused
on high productivity projects in the following major sectors.

a) Regional entreport trade

b) Export oriented manufacturing of high-value added goods:

c) Petroleum refining

d) shipping

e) Provision of specialized services for international market

such as

Banking

Finance
Telecommunication
Tourism

TET

Logistic Services
Regional Warehouse

eee ece oe

b) The MP-SER shall be managed and operated by MP-SERA
respecting all contracts and concessions legitimately entered into by
the National government/PPA. It shall be operated in accordance to
the rules and regulations of the Bangko Sentral ng Pilipinas (BSP),
the Department of Finance (DOF), the Bureau of Customs (BOC)
and Department of Trade and Industry (DTI), in accordance with
the National Internal Revenue Code (NIRC) of 1997, as amended,
and the Tariff and Customs Code of the Philippines.


c) The MP-SER shall continue to be prioritized by the national
government with transportation, infrastructure and facilities needed
to help decongest traffic in Metro Manila and prevent traffic loss
thru the construction of the port linkage infrastructures to the
proposed Connector Road going to the North and South of Luzon as
well the construction of the needed inland railway system
originating from the ports going to the depot and vice-versa and
other urban highway network development using Savings from the
funds of DPWH or DOTC.

d) The MP-SERA shall promote and provide support services to
sustain the growth of export, as determined by the Board;

e) The MP-SERA may establish mutually beneficial economic
relations with other entities or enterprises within the country or with
foreign entities or enterprises;

f) Foreign citizens and companies owned by non-Filipinos in
whatever proportion may set up enterprises in the MP-SER either
by themselves or in joint venture with Filipinos in any sector of
industry, international trade and commerce within the MP-SER

g) No real property located within MP-SER may be sold.

h

To have an efficient and graft-free administration, MP-SERA shall
ensure of compliance on Sec 338( Prohibition against advance
payments), Sec. 339 (Cash Advances) , Sec. 343 (Prohibition
against expenses for reception and entertainment) Of the 1991 Local
Government Code.

i) It shall adopt Sec 355- 383 Of the 1991 Local Government Code on
the “Property and Supply Management”.

SECTION. 6. FUNCTIONS AND POWERS EXCLUSIVELY
VESTED IN MP-SERA.

A) THE ADMINISTRATION SHALL HAVE THE FOLLOWING
FUNCTIONS AND POWERS ON THE SPECIAL ECONOMIC
REGION:

(a) Formulate, coordinate and/or execute policies on the
implementation of all programs, projects and activities of the
government affecting or relating to MP-SER;


10

(b) To exercise control of or administer any foreshore rights or leases
which may be vested in MP-SERA;

(c) Enter into contracts with any private persons or entity or any
government agency, either domestic or foreign, whenever
necessary for the effective discharge of its functions and
responsibilities under such terms and conditions as it may deem
proper and reasonable;

(d) Acquire through sale, expropriation or other means, hold real and
personal property as it may deem necessary or conyenient in the
successful prosecution of its work, and mortgage, sell alienate, or
otherwise dispose any of its personal property; No land or real
property located within the MP-SER may be sold, alienated or
otherwise disposed.

(e) Receive, take and hold by bequest, device, donation, gift, purchase
or lease, from foreign or domestic sources, either absolutely or in
trust for any of its purposes, any asset, grant or property, real or

are provided in existing

personal, subject to such limitations
laws and regulations; to convey such assets, grant or property;
invest and reinvest the same and deal with and expand it:
and income in such manner as will best promote its objectives;

assets

(f) Initiate, plan, undertake and supervise the restoration, upkeep and
maintenance of the economic area of MP-SER;

(g) Prepare, adopt, revise and enforce such rules and regulations,
implementing guidelines and standards as are necessary for the
effective regulation of the land use and development activities in
MP-SER of both the government and private entities and for the
implementation of the MP-SER Plan, including, but not limited to
development rules and regulations pertaining to the following:

1. Land use allocation, use of buildings, their height, dimensions,
architectural style and designs and other specifications of
the building construction to be undertaken therein;

2. Traffic management, street usage and other related matters;

3. Size and character of display signs, advertising billboards, and other
external signs and advertisements in buildings, in open spaces lots or
roads;


ca

h) Expropriate properties within MP-SER;

i) Prescribe reasonable amounts to be charged as lease or filing
fees, inspection fees, permit fees, and other administrative or service fees
necessary for the effective enforcement of its laws and regulatory
measures, to be used and disbursed by it in the manner determined by it to
promote its objectives;

j) Exercise all powers necessary or incidental to the attainment of
the objectives of this Law.

B) FUNCTIONS AND POWERS OF MP-SERA ON THE

PORTS:

i To formulate a comprehensive and practicable Port
Development plan and to program its implementation, renew
and update the same annually in coordination.

ii, To supervise, control, regulate, construct, maintain, operate,
and provide such facilities including buildings and installation
or services as are necessary within or outside MP-SER and any
of its port district as long as it will directly benefit said ports in
MPSER on its own or thru private sector.

iii. To prescribe fees, dues and charges within the concept of due
process of notice and hearing.

iv. To prescribe rules and regulations, procedures, and guidelines
governing the establishment, construction, maintenance, of all
other port districts

v. To license, control, regulate, supervise any construction or
structure within MP-SER controlled ports and its other port
districts.

vi. To investigate and provide services (whether on its own, by
contract, or otherwise) within the MP-SER and its port districts
and the approaches thereof, including but not limited to

= berthing, towing, mooring, moving, slipping, or docking any
vessel;

= loading or discharging any vessels;

= sorting, weighing, measuring, storing, warehousing, or
otherwise handling goods.


SECTION. 7 THE CORPORATE POW

12

vii, To coordinate with the Bureau of Lands or any other
government agency or corporation, in the development of any
foreshore area.

viii, To control, regulate, and supervise pilotage and the conduct of

pilots in any MP-SER controlled ports.

ix. To provide or as in the provision of training programs and
training facilities for its staff or staff of port operators and users
for the efficient discharge of its functions, duties, and
responsibilities.

x. To perform such acts or provide such services as may be

deemed proper or necessary to carry out and implement the
provisions of this Law.

RS OF MP-SERA

SHALL BE AS FOLLOWS:

vi.

vii.

viii.

To succeed in its corporate name.
To sue and be sued in such corporate name.

To adopt, alter, and use a corporate seal which shall be judicially
noticed.

To adopt, amend, or repeal its by-laws.

To create or alter its own organization or any Port Management
Unit, and staff such an organization or Port Management Unit with
appropriate and qualified personnel in accordance with what may
be deemed proper or necessary to achieve the objectives of MP-
SER.

To make or enter of any kind or nature to enable it to discharge its
functions under this Law.

To acquire, purchase, own, or lease any land, port facility, wharf,
quay, or property of any kind, whether movable or immovable
However, it cannot mortgage, sell, or otherwise dispose any land,
port facility, wharf, quay or property of any kind within MP-SER.

To reclaim, excavate, enclose, or raise any part of the lands vested
in the MP-SERA or any of its port district.

To dredge or provide dredging services


x. To protect the environment and prescribe ways to diminish if not
eradicate pollution in Manila de Bay.

xi, To acquire any undertaking affording or intending to afford
facilities for the loading and discharging or warehousing of goods.

xii, To supply water or bunkers for ships.

xiii, To obtain insurance for or require the insurance of any property,
movable or immovable, belonging to the MP-SERA and/or goods
in the custody of the MP-SERA or any of its port district

xiv. To do all such other things and to transfer all such business directly
or indirectly necessary, incidental or conducive to the attainment of
the purposes of the MP-SERA.

xv. Generally, to exercise all the powers of a corporation under the
Corporation Law insofar as they are not inconsistent with the
provisions of this Law.

SECTION 8. AUTHORITY OF THE BUREAU OF
CUSTOMS (BOC) TO EXAMINE THE ENTRY AND EXIT OF
IMPORTED ARTICLES IN THE MP-SER. - The BOC, shall have the
authority to examine the entry and exit of imported articles in the MP-SER or
any of its port district.

SECTION 9. AUTHORITY OF PHILIPPINE PORT
AUTHORITY (PPA) ~ A) The PPA shall have the authority to collect dues,
fees and charges within the port MP-SER which shall be automatically remitted
to MP-SERA, to wit

a) Wharfage dues

b) Share in Arrastre / Stevedoring Income

c) Dockage Fees

d) Port Dues

e) Storage Charges

f) Port Usage Fees

2) Terminal Fe

h) Vessel Traffic Management Service Fees

i) Pilotage

i) Lay-up Fees

k) Berthing Charges

1) and other existing port dues, charges or fees in force and effect before
the effectivity of this Law

m) and others to be imposed by MP-SERA.



14

B) It shall also have the authority to conduct hearing on Tariff
‘Adjustment Petition and to arbitrate, and decide on issue limited only
as to the reasonability of the inerease or decrease of charges, fees, and
dues.

©)To set aside 10% of its budget provided in the General
Appropriation Act (GAA) for port development to protect the
environment and to diminish if not eradicate pollution in Manila
de Bay.

SECTION 10. AUTOMATIC RELEASE OF SHARES:

All collections by PPA within MP-SER and the latter’s port districts shall be
remitted, without need of any further action, directly to MP-SERA, on a daily
basis, and which shall not be subject to any lien or holdback that may be
imposed by the National Government for whatever purpose.

SECTION 11 POWER TO MAKE PORT REGULATIONS. —
a) The MPSERA may make rules or regulations for the planning, development,
construction, maintenance, control, supervision and management of MP-SER or
Port owned by MP-SER and the services to the provided therein, and for the
maintenance of good order therein, and generally for carrying out the purposes
of this Law.

b) MP-SERA may provide separate regulations for each category of its port and
port dis

SECTION 12. DANGEROUS CARGO. ~ a) The MP- RA may
make regulations for the conveyance, loading, discharging and storage of
dangerous goods within any port, port district, and the approaches to the port

b) The MP-SERA may provide separate regulations for each category of ports
or port district,

SECTION 13. POWERS OF HARBOR MASTER. ~ Further to
the provisions of any regulation under the Power to Make Port Regulation &
Dangerous Cargo of this Decree, the MP-SERA thru the Harbor Master Port or
Port owned and controlled by MP-SER may:

a) Direct where any vessels shall be berthed, moored, or anchored, and the
method of anchoring within the port and the approaches to the port;

b) Direct the removal of any vessel from any berth or anchorage to another
berth or anchorage and the time within such removal is to be effected; and

©) Regulate the mooring of vessels within the port and the approaches to the
port,


15

SECTION. 14. LOCATIONAL CLEARANCE,
CONSTRUCTION AND OTHER PERMITS.

‘All locational clearances and construction permits for the development of
lands, introduction of improvements, and the use, change of use,
construction, repair, alteration or re-construction of buildings within MP-
SER and other forms of permits shall be issued by the MP-SERA on the
basis of the approved MPSER Development Plan and other implementing
rules and regulations. The Administration may seek the assistance of
Department of Public Works and Highways insofar as the minimum
standards of safety of buildings, electrical, plumbing and drainage
requirements are concerned,

The provisions of P.D. No. 1096, otherwise known as the National
Building Code and other related laws which are not inconsistent with this
Law and the rules and regulations promulgated by the MP-SERA shall
have a suppletory effect to this law and to the development control
regulations promulgated by the MP-SERA."

SECTION 15. REALTY TAXES — The MP-SERA shall not be
exempted from the payment of real property taxes imposed by the
Republic of the Philippines, its agencies, instrumentalities or political
subdivisions; provided that investments in fixed assets shall be deductible
for income taxes purposes. Provided, finally, that the investor who made
an investment in reclaiming the land shall be exempted from real property
tax up to the amount invested for said reclamation within the number of
years of concession given to said investor.

SECTION 16. BANKING RULES AND REGULATIONS. -
Existing banking laws and rules and regulations of the BSP (Banko
Sentral ng Pilipinas) shall apply to banks and financial institutions to be
established in the MP-SER, such as those governing foreign exchange and
other current account transactions (trade and non-trade), local and foreign
borrowings, foreign investments, establishment and operation of local and
foreign banks, foreign currency deposit units, offshore banking units and
other financial institutions under the supervision of the BSP,

SECTION 17. BOARD OF DIRECTORS OF THE MP-SERA. -
The powers of the MP-SERA shall be vested in and exercised by a Board
of Directors, hereinafter referred to as the Board, which shall be
composed of the following:


16

(a) The chairman who shall, at the same time, be the administrator of
the MPSER

(b) A vice chairman who shall come from among the members of the
Board;

(c) Members consisting of:

1, One (1) representative from the highest official of PPA;

2. One (1) representative from the highest official of Philippine Navy,
3. One (1) representative from the Mayor's Office;

4. One (1) representative from the Vice Mayor’s Office;

wa

. One (1) representative from the investors in the ports of MP-SER;

6. One (1) representative from the ship owners or shipping operators
in the ports of MP-SER;

7. One (1) representative from any association providing services
related to import and export representing either the customs
brokers, or port users or truckers or any recognized group
transacting business within MP-SER;

8. One (1) representative from the workers working in MP-SER.

The chairman and the members of the Board, except representatives
from the office of the mayor and vice-mayor, shall be appointed by
the President of the Philippines, All shall serve for six (6) years,
unless sooner separated from service due to death, voluntary
resignation or remoyal for cause or expiration of the term of the
appointing officer. In case of death, resignation or removal for
cause or expiration of the term of the appointing officer, the
replacement shall serve only the unused portion of the term
However, they may observe hold-over in their respective position
until properly installed by the appointing officer.

All members of the Board must be equipped with the following
qualifications:

-must be a Filipino citizen, except for the representative of the

business sector,

-must be of good moral character, of probity and integrity, and


7

- must be a degree holder in any of the following fields: economics.
urban planning, business, law, management or their equivalent or
with at least five (5) ye
operations.

relevant working experience in port

In addition to the above qualifications, the chairman/administrator ,
must have acquired experience in development planning of ports or
any related field for at least five (5) years

The members of the Board shall each receive per diem at rates to be
determined by the Department of Budget and Management (DBM)
in accordance with the existing rules and regulations. Provided,
however, that the total per diem collected each month shall not
exceed the equivalent of four (4) meetings:

SECTION 18. POWERS AND DUTIES OF THE
CHAIRPERSON. - The chairperson shall have the following powers and
duties:

(a)Direct, manage and supervise the operation and internal
administrative affairs of the MP-SERA subject to the control and
supervision of the Board;

(b) Establish the internal organization of the MP-SERA under such
conditions that the Board may prescribe;

(c) Submit an annual budget and necessary supplemental budget to the
Board for its approval;

(d) Submit within thirty (30) days after the close of each fiscal year an
annual report to the Board and such other reports as may be
required;

(e) To prepare all memoranda pertaining to each and every item in the
agenda for every meeting of the Board and to submit for the
consideration thereof such proposals or recommendations which are
necessary to carry out effectively and beneficially the business of
MP-SERA.

(£) Create a mechanism in coordination with relevant agencies for the
promotion of industrial peace, the protection of the environment
and the advancement of the quality of life of the Manilenos; and


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(g) To implement the policies and administer the measures approved
by the Board and perform such other duties as may be assigned to
him/her or which are necessary or ineidental to his/her office

SECTION 19. | ORGANIZATION AND PERSONNEL. - The Board
of the MP-SERA shall provide for an organization and staff of its officers
and employees from the current employees and officers of PPA handling.
legal, port operations, administration and management in Manila.
Although the Chairman may hire or contract new staff, experts and
consultants under such conditions that the Board may prescribe and
subject to the confirmation of the latter;

Upon the recommendation of the chairperson, the Board shall
appoint and fix the remuneration and other emoluments of its officers and
employees in accordance with existing laws on compensation and position
classification. Bonuses and incentives more than one month salary may be
given provided it is with the approval of DBM and COA. Provided, That
the Board shall have exclusive and final authority to promote, transfer,
assign or re-assign officers of the MP-SERA: Provided, further, No
officer or employee of the MP-SERA shall be removed or suspended
except for causes provided by the Labor Code.

The officers and employees of the MP-SERA, including all
members of the Board, shall not engage directly or indirectly in partisan
activities nor take part in any election, except to vote.

SECTION 20. CAPITALIZATION. - The MPSERA shall have an
authorized capital stock of Five Billion Pesos (Php5,000,000,000.00) with
option to increase capitalization upon the discretion of the MPSERA,
divided by into Ten Thousand Pesos (Php10,000.00) no par shares fully
subscribed and paid by the Republic of the Philippines from the Retained
Earnings of PPA.

b) Yearly cash contribution by the Government shall be thirty percent
(30%) of the amount appropriated in the General Appropriation Act for
ports pursuant to PD 857.

c) And the amount of Five Hundred Million Pesos
(Php500,000,000.00) a year is hereby appropriated out of any fund
in the National Treasury not otherwise appropriated.

SECTION, 21. SHARING OF NET PROFIT FROM PORT
REVENUES COLLECTED BY PPA WITHIN MP-SER.

- 50% goes to National Government
— 40% goes to City of Manila. (as prescribed in Sec 290 of the
LGC)


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= 10% goes to MP-SERA

The share of City of Manila and MP-SERA shall be exclusively
utilized for programs and projects that will directly or indirectly redound
to the improvement and development of its port operations or port
facilities or special economic area.

However, income out of the improvement and development of MP-
SERA in MP-SER and other future ports of MP-SER using the share of
the City of Manila, such income upon resolution coming from the City
Council of Manila be appropriated as a special fund for local
development, livelihood projects, health, and scholarship programs and
other social services of the City.

Provided, further, income out of the improvement and development
of MP-SER and other future ports of MP-SER using the share of MP-
SERA shall be exclusively used for the improvement port operation or
facilities.

SECTION. 22. SHARING OF N PROFIT FROM THE
SPECIAL ECONOMIC REGION

- 50% goes to City of Manila.

— 50% goes to MPSERA

Collection of lease income, and any other payment, dues, fees and charges
from the Special Economic Region shall be exclusively within the
mandate of MP-SERA.

Share of the City of Manila from the special economic region of MP-SER
is directly released to Manila and shall be appropriated as special funds
for infrastructure projects, health, and scholarship programs and other
social services of the City of Manila.

However, share of MP-SERA on the Special Economie Region shall be
exclusively used for the development, improvement, operation and
administrative expenditure on the special economic region of MP-SER or
of the Manila Ports or any of its port districts

SECTION. 23 ASSURANCE OF NETINCOME - All Operating
Expenses must not exceed Fifty percent (50%) of its projected revenues of
the year. However, all of its retained earnings and reserves shall not be
computed as part of its revenue.

Retained Earnings and reserves must be used for the development and
improvement of port facility and/or special economic region in MP-SER
or that of its port districts.


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SECTION. 24 NON-CURRENT ASSETS 7 Besides _ the
authorized capital stocks taken from the income of PPA, all non-current
assets of PPA within the jurisdiction of Manila shall be transferred to
MP-SERA, to wit:

e Property and Equipment

e Investment and Securities

e And other Non-current Assets

However, all unliquidated accounts shall be properly liquidated by PPA
to be taken from its Retained Earnings.

SECTION. 25 NON-OPERATING INCOME - All non-operating
income incurred within the jurisdiction of Manila shall be under the
control and supervision of MPSERA.

SECTION 26. CREATION OF RESERVES. — The balance of any
revenue or income of the MPSERA remaining at the end of each year
shall be applied to the creation of a general reserve or such other reserves
as the MPSERA may deem appropriate for the development and
improvement of MP-SER and its port districts.

SECTION 27. INVESTMENT OF FUNDS. — The MPSERA may,
from time to time, invest any of its funds not immediately required to be
expended in meeting its obligations or in the discharge of the functions of
the MPSERA in such government securities approved by the Board.

SECTION 28. | BORROWING POWERS. — a) The MPSERA may
after consultation with the Central Bank and the Department of Finance,
and with the approval of the President of the Philippines, raise funds,
either from local or international sources, by way of loans, credits or
indebtedness or issue bonds, notes, debentures, securities, and other
borrowing instruments, including the power to create pledges, mortgages,
and other voluntary liens or encumbrances on any of its assets or
properties

b) All loans contracted by the MPSERA under this Section together with
all interests and other sums payable in respect thereof, shall constitute a
charge upon all the revenues and assets of the MPSERA and shall rank
pari passu with one another, but shall have priority over any other claim or
charge on the revenue and assets of MP-SERA; Provided, That this
provision shall not be construed as a prohibition or restriction on the
power of the MP-SERA to create pledges, mortgages and other voluntary
liens or encumbrances on any property of the MP-SERA.

c) Except as expressly authorized by the President of the Philippines, the
total outstanding indebtedness of the MP-SERA in the principal amount in
local and foreign currency shall not at any time exceed fifty percent (50%)
of the networth of MP-SERA at the duly relevant time.


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d) The President of the Philippines, by himself or through his duly
authorized representative, is further hereby authorized to guarantee in the
name and on behalf of the Republic of the Philippines, the payments of
the loans or other indebtedness of the MP-SERA up to the amount herein
authorized

e) All interests paid or payable by the MP-SERA on its loans or other
forms of indebtedness shall be exempt from taxes of whatsoever nature

SECTION 29. TRANSFER OF PROPERTIES
A) TRANSFER OF EXISTING AND COMPLETED PHYSICAL PORT
FACILITIES. — In accordance with the transitory provisions of this Law,
there shall be transferred to the MPSERA all existing and completed
public port facilities, quays, wharves, docks, lands, buildings and other
property, movable or immovable, belonging to PPA within the territorial
sdiction of Manila.

B) TRANSFER OF ADMINISTRATION AND PROPERTIES

The ownership of the properties of national government agencies located
within MP-SER shall, upon agreement with the agencies concerned, be
transferred to the MP-SERA. The properties of government corporations,
‘on the other hand, shall, subject to mutually acceptable terms and
conditions, be sold to the MP-SERA. In the case of government financial
institutions sale to the MP-SERA of their properties shall also include
acquired assets located within MP-SER.

Alll proposed transactions affecting private properties within MPSER shall
be registered with the MP-SERA. The MP-SERA shall, in the case of sale,
have the right of first refusal

Registered voters in the barangays within MP-SER listed in the 2013
National Elections shall be given housing settlement in an on-site
development in a high rise condominium, unless agreed otherwise by the
registered voters in said barangays in an election process. Barangay
budget must be used in the physi
building. In case of deficit, MP-SERA shall help finance it

al and structural maintenance of said

SECTION 30. TRANSFER OF INTANGIBLE ASSETS. In
accordance with the transitory provisions of this Law, there shall be
transferred to the Administration all intangible assets, powers, rights,
foreshore rights, interests and privileges belonging to the Philippine Ports
Authority (PPA) relating to port works or port operations within MP-SER,
subject to terms to arranged by and between the MP-SERA and agencies
concerned. Any disagreement relating to such transfer shall be elevated to
the President of decision.



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SECTION 31 NOTES ON SINKING FUND ~ shall be retained in
the control and supervision of PPA for payment of their future Notes
obligation

SECTION 32. PROJECTS IN PROGRESS. — In accordance with
the transitory provisions of this Law, all ongoing projects relating to the
construction of ports and port facilities shall be continued by the agency
or agencies involved until completion. After completion, such projects
shall be transferred to the MPSERA in accordance with the agreement
among agencies concerned. Any disagreement relating to such transfer be
elevated to the President for decision.

SECTION 33. TRANSFER OF LIABILITIES AND DEBTS.
Upon the transfer and acceptance by the MP-SERA of the existing
physical facilities, intangible assets, and completed projects referred to in
the Sections immediately preceding, all debts, liabilities, and obligations
of the PPA concerned in respect such physical facilities, intangible assets
and completed projects within the MPSER shall likewise be transferred to
or deemed incurred by MPSER except for the liabilities that are “incurred
beyond Manila jurisdiction” as well as liabilities not properly accounted
for as per the reports coming from the Commission on Audit which shall
be retained and paid by PPA. Notes on Sinking Fund shall be also paid by
PPA.

SECTION 34. | ANNUAL BUDGET — a) The Board shall every year
cause to be prepared and shall adopt annual estimates of income and
expenditures and estimates of capital expenditure of the Authority for the
ensuing year.

b) Supplementary estimates may be adopted at any of the meetings of the
Board.

SECTION 35. ANNUAL ACCOUNTS - a) The Board shall
cause proper accounts and other records of the Authority in relation
thereto to be kept. An annual statement of account shall be rendered in
respect to each year. MP-SERA shall maintain such accounts and other
records under a commercial system of accounting.

b) The accounts of the MP-SERA shall be kept and made up to 31
December in each year.

c) The annual statement of accounts of the MP-SERA shall present a true
and fair value of the financial position of the MPSERA and of the results
of the operations of the MP-SERA for the year to which it relates.

SECTION 36. | AUDITOR ~ a) In consonance with existing laws and
regulations, the Commission on Audit shall be appointed to audit the
accounts of the MP-SERA. In the fulfillment of international contractual


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commitments of the MP-SERA, however, the Board may engage the
services of any person or firm duly authorized by law for the audit of
accounts, to audit the accounts of the MP-SERA.

b) The Auditor shall be paid out of the revenue of the MP-SERA such
remuneration, compensation or expenses as the Board may determine.

SECTION 37. AUDITOR’S REPORT. — The Auditor shall as soon
as practicable, but not later than three months after the accounts have been
submitted for audit, send an annual report to the Board. The Auditor may
also submit such periodical or special reports to the Board as may to him
appear necessary.

SECTION 38. | ANNUAL REPORT. - The Board shall submit to the
President of the Philippines together with the Auditor’s Report on the
relevant accounts, an annual report generally dealing with the activities
and operations of the MP-SERA during the preceding year and containing
such information relating to the proceedings and policies of the MP-
SERA.

SECTION 39. | SUPERVISION AND COORDINATION OF
DEVELOPME! PLANS. - For purposes of policy direction and
coordination, the MP-SERA shall be under the direct control and
supervision of the Secretary of Department of Transportation and
Communications.

SECTION 40. | RELATIONSHIP WITH NATIONAL,
ECONOMIC DEVELOPMENT ADMINISTRATION (NEDA). - The
MPSERA shall determine the development goals for the MPSER within
the framework of national development plans, policies and goals. The
administrator shall, upon approval by the Board, submit the MPSERA
plans, programs and projects to NEDA for inclusion and inputs to the
overall regional development plan,

SECTION 41. LEGAL COUNSEL. - When the exigencies of its
businesses and operations demand it, the MP-SERA may engage the
services of a counsel cither on a case to case or on a fixed retainer basis.

SECTION 42. INTERPRETATION/CONSTRUCTION. — The
powers, authorities and functions that are vested in the MP-SERA are
intended to decentralize governmental functions and authority and
promote an efficient and effective working relationship with the national
government and the City of Manila. However, in case of conflict, the
interpretation that is most advantageous for the development and success
of MP-SER shall prevail.


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SECTION 43. AUDITING. - The Commission on Audit shall
appoint a representative who shall be a full-time auditor of the MP-SERA
and assign such number of personnel as may be necessary to assist said
representative in the performance of his/her duties. The salaries and
emoluments of the assigned auditor and personnel shall be in accordance
with pertinent laws, rules and regulations.

SECTION 44, SEPARABILITY CLAUSE. - If any provision of this
Act shall be held unconstitutional or invalid, the other provisions not
otherwise affected shall remain in full force and effect.

SECTION 45. REPEALING CLAUSE. - All laws, executive orders
or issuances or any part thereof which are inconsistent herewith are
hereby repealed or amended accordingly.

SECTION 46. EFFECTIVITY CLAUSE. - This Act shall take
effect fifteen (15) days after its publication in at least two (2) national
newspapers of general circulation.

Approved