PROVIDING FOR THE REORGANIZATION OF PORT ADMINISTRATION AND OPERATION FUNCTIONS IN THE PHILIPPINES, REVISING PRESIDENTIAL DECREE NO. 505 DATED JULY 11, 1974, CREATING THE PHILIP…

WHEREAS, there is a recognized need to integrate and
coordinate port planning, development, control and operations at the
national level, and at the same time promote the growth of regional port
bodies responsive to the needs of their individual localities;

WHEREAS, harbors and tributary areas have their own peculiar
potentialities to be considered in port planning and development;

WHEREAS, hitherto, the concept of port administration in
this country has been focused on the traditional functions of revenue
collection, harbor maintenance and cargo handling, to the exclusion of
the port’s fuller utilization and development as a spur for regional
growth;

WHEREAS, Presidential Decree No. 505 was promulgated on July
11, 1974 to carry out these stated objectives; and

WHEREAS, it was found necessary in the national interest to
amend Presidential Decree No. 505 so as to enable the Philippine Port
Authority to exercise all the proper powers and functions of a port
authority and in order to better carry out the desired objectives:

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the
Philippines, by virtue of the powers vested in me by the Constitution in
order to effect desired changes and reforms in the social, economic and
political structure of cur society, do hereby decree and order the
revision of Presidential Decree No. 505 by substitution with this Decree
which is hereby adopted and made part of the laws of the land;

ARTICLE I. TITLE

SECTION 1. Title—This Decree shall be known as the
Revised Charter of the Philippine Ports Authority created under
Presidential Decree No. 505 dated July 11, 1974.

ARTICLE II. DECLARATION OF POLICIES

SEC. 2. Declaration of Policies and Objectives—It is
hereby declared to be the policy of the State to implement an integrated
program for the planning, development, financing, and operation of
Ports or Port Districts for the entire country in accordance with the
following objectives:

1. To coordinate, streamline, improve, and optimize the planning,
   development, financing, construction, maintenance and operation of
   Ports, port facilities, port physical plants, and all equipments used in
   connection with the operation of a Port.
2. To ensure the smooth flow of waterborne commerce
   passing through the country’s Ports whether public or private, in the
   conduct of international domestic trade.
3. To promote regional development through the dispersal of
   industries and commercial activities throughout the different regions.
4. To foster inter-island seaborne commerce and foreign trade.
5. To redirect and reorganize port administration beyond its
   specific and traditional functions of harbor development and cargo
   handling operations to the broader function of total port district
   development, including encouraging the full and efficient utilization of
   the Port’s hinterland and tributary areas.
6. To ensure that all income and revenues accruing out of dues,
   rates, and charges for the use of facilities and services provided by
   the Authority are properly collected and accounted for by the Authority,
   that all such income and revenues will be adequate to defray the cost
   of providing the facilities and services (inclusive of operating and
   maintenance cost, administration and overhead) of the Port Districts,
   and to ensure that a reasonable return on the assets employed shall be
   realized.

ARTICLE III. DEFINITIONS

SEC. 3. Definitions—For the purpose of this Decree and
of the by-laws, regulations, or rules promulgated thereunder, the terms
or words used herein shall, unless the context indicates otherwise, mean
or be understood to mean, as follows:

1. “Authority” means the Philippine Torts Authority created by
   this Decree.
2. “Board” means the Board of Directors of the Authority
   appointed by the President under Section 7 of this Decree.
3. “Functions” includes powers and duties.
4. “Port District” means the territorial jurisdiction under the
   control, supervision or ownership of the Authority over an area
   (land or sea), declared as such in accordance with Section 5 of this
   Decree including but not limited to any Port within said District.
5. “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 waterborne commerce, and including
   all the land and water areas and the structures, equipments and
   facilities related to those functions.
6. “Navigable waters” means all navigable portions of the seas,
   estuaries, and inland waterways.
7. “Anchorage” means a place with sufficient depth of water where
   vessels anchor or may ride at anchor within the harbor.
8. “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.
9. “Basin” means naturally or artificially enclosed or nearly
   enclosed body of water in free communication with the sea.
10. “Dock” includes locks, cuts, entrances, graving docks, inclined
    planes, slipways, quays, and other works and things appertaining to any
    dock.
11. “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.
12. “Pier” 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.
13. “Warehouse” means a building or shed used for the storage of
    cargo.
14. “Transit Shed” means a building or shed which is situated at or
    rear a quay, wharf or pier and is used for the temporary or short-term
    storage of goods in transit, or to be shipped or discharged from a
    vessel.
15. “Wharf” 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.
16. “Transportation Facility” includes rails and railcars, highways
    wheeled vehicles, bridges, tunnels, tramways, subways, passenger or
    cargo vessels, ferryboats, 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.
17. “Lighter” means a flat-bottomed boat or barge used in loading or
    unloading cargo to or from vessels.
18. “Vessel” includes any ship or boat, or any description of a
    vessel or boat.
19. “Goods” Includes animals, carcasses, baggage, and any movable
    property of any kind.
20. “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 this Decree.
21. “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.

ARTICLE IV. ESTABLISHMENT. CONSTITUTION, POWERS AND
DUTIES

SEC. 4. Creation of Philippine Ports Authority—

1. There is hereby established a body corporate to be known as the
   Philippine Ports Authority (hereinafter called the Authority), which
   shall be attached to the Department of Public Works
   Transportation and Communications.
2. The principal office of the Authority shall be located in
   Metropolitan Manila, but it may establish port management units and
   other offices elsewhere in the Philippines as may become necessary for
   the proper conduct of its business.

SEC. 5. Port District—The Authority may, from time to time,
submit to the President, through the National Economic and Development
Authority, applications for the declaration of specific areas as Port
District. Such applications shall be accompanied by a survey plan
indicating the geographical location of the area or areas to be declared
as Port Districts with their respective boundaries properly delineated.

SEC. 6. Corporate Powers and Duties—

1. The corporate duties of the Authority shall be:

1. To formulate in coordination with the National Economic
   Development Authority a comprehensive and practicable Port Development
   plan for the State and to program its implementation, renew and update
   the same annually in coordination with other national agencies.
2. To supervise, control, regulate, construct, maintain, operate,
   and provide such facilities or services as are necessary in the ports
   vested in, or belonging to the Authority.
3. To prescribe rules and regulations, procedures, and
   guidelines governing the establishment, construction, maintenance, and
   operation of all other ports, including private ports in the country.
4. To license, control, regulate, supervise any construction or
   structure within any Port District.
5. To provide services (whether on its own, by contract, or
   otherwise) within the Port Districts and the approaches thereof,
   including but not limited to—

—berthing, towing, mooring, moving, slipping, or docking any
vessel;
—loading or discharging any vessel;
—sorting, weighing, measuring, storing, warehousing, or otherwise
handling goods.

6. To exercise control of or administer any foreshore rights or
   leases which may be vested in the Authority from time to time,
7. To coordinate with the Bureau of Lands or any other government
   agency or corporation, in the development of any foreshore area.
8. To control, regulate, and supervise pilotage and the conduct
   of pilots in any Port District.
9. To provide or assist 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.
10. To perform such acts or provide such services as may be deemed
    proper or necessary to carry out and implement the provisions of this
    Decree.

2. The corporate powers of the Authority shall be as follows:

1. To succeed in its corporate name.
2. To sue and be sued in such corporate name.
3. To adopt, alter, and use a corporate seal which shall be
   judicially noticed.
4. To adopt, amend, or repeal its by-laws.
5. 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 the Authority.
6. To make or enter contracts of any kind or nature to enable it
   to discharge its functions under this Decree.
7. To acquire, purchase, own, lease, mortgage, sell, or
   otherwise dispose of any land, port facility, wharf, quay, or property
   of any kind, whether movable or immovable.
8. To exercise the right of eminent domain, by expropriating the
   land or areas surrounding the Port or harbor, which in the opinion of
   the Authority, are vital or necessary for the total development of the
   Port District.
9. To levy dues, rates, or charges for the use of the premises,
   works, appliances, facilities, or for services provided by or belonging
   to the Authority, or any other organization concerned with port
   operations.
10. To reclaim, excavate, enclose, or raise any part of the lands
    vested in the Authority.
11. To dredge or provide dredging services, within a Port District
    or elsewhere.
12. To acquire any undertaking affording or intending to afford
    facilities for the loading and discharging or warehousing of goods in
    the Port Districts.
13. To supply water or bunkers for ships.
14. To obtain insurance for or require the insurance of any
    property, movable or immovable, belonging to the Authority and/ or goods
    in the custody of the Authority.
15. To do all such other things and to transact all such business
    directly or indirectly necessary, incidental or conducive to the
    attainment of the purposes of the Authority.
16. Generally, to exercise all the powers of a corporation under
    the Corporation Law insofar as they are not inconsistent with the
    provisions of this Decree.

SEC. 7. Board of Directors—

1. The corporate powers of the Authority shall be vested in a
   Board of Directors, which shall consist of the following members:

1. The Secretary of Public Works, Transportation and
   Communications, who shall act as Chairman.
2. The General Manager of the Authority, who shall act as
   Vice-Chairman.
3. The Director-General of National Economic and Development
   Authority.
4. The Secretary of Finance.
5. The Secretary of Natural Resources.
6. The Secretary of Trade.

   The Directors listed under subsections a) (i) to (vi) shall be
   ex-officio members of the Board of Directors.

7. One (1) other person who shall be appointed by the President
   of the Philippines, representing the private sector, who by reason of
   his knowledge or experience is, in the opinion of the President, fit and
   proper person to be Director of the Board. Provided, That, in
   the absence of the Director appointed in subsections (iii) to (vi), the
   Director concerned shall designate the officer next in rank to him in
   his department or office to act on his behalf as a Director.

2. The Director from the private sector shall hold office
   for a period of three years from the date of his appointment and shall
   be eligible for reappointment upon the completion of such period.
3. The members of the Board or their respective alternates shall
   receive a per diem as it may approve for each Board meeting actually
   attended by them: Provided, That, such per diems shall not
   exceed one thousand pesos during any one month for each member:
   Provided further, That no other allowances or any form of
   compensation shall be paid them, except actual expenses in traveling to
   or from their residences to attend Board meetings.

ARTICLE V. ORGANIZATION AND STAFF

SEC. 8. Management and Staff—

1. The President shall, upon the recommendation of the Board,
   appoint the General Manager and the Assistant General Managers.
2. All other officials and employees of the Authority shall be
   selected and appointed on the basis of merit and fitness based on a
   comprehensive and progressive merit system to be established by the
   Authority immediately upon its organization and consistent with Civil
   Service rules and regulations. The recruitment, transfer, promotion,
   and dismissal of all personnel of the Authority, including temporary
   workers, shall be governed by such merit system.
3. The General Manager shall, subject to the approval of
   the Board, determine the staffing pattern and the number of personnel
   of the Authority, define their duties and responsibilities, and fix
   their salaries and emoluments. For professional and technical
   positions, the General Manager shall recommend salaries and emoluments
   that are comparable to those of similar positions in other
   government-owned corporations, the provisions of existing rules and
   regulations on wage and position classification notwithstanding.
4. The General Manager shall, subject to the approval by the
   Board, appoint and remove personnel below the rank of Assistant General
   Manager.
5. The General Manager of the Authority shall receive a salary to
   be determined by the Board, and approved by the President.
6. The number of Assistant General Managers of the Authority shall
   in no case exceed three (3) who shall each receive a salary to be
   determined by the Board and approved by the President.

SEC. 9. General Powers and Duties of the General Manager
and Assistant General Managers.

1. General Powers and Duties of the General Manager—

The General Manager shall be responsible to the Board, and shall
have the following general powers, functions, and duties:

1. To implement, enforce and apply the policies, programs,
   guidelines, procedures, decisions, rules and regulations promulgated,
   prescribed, issued or adopted by the Authority.
2. To manage the day to day affairs of the Authority, and ensure
   the operational efficiency of the Ports under the jurisdiction and
   ownership of the Authority.
3. To sign contracts, to approve expenditures and payments
   within the budget provisions, and generally to do any all acts or things
   for the proper operations of the Authority or any of the Ports under
   the jurisdiction, control or ownership of the Authority.
4. To submit an annual budget to the Board for Recurrent Income
   and Expenditure and the Estimated Capital Expenditure for its option not
   later than two months before the commencement of the ensuing fiscal
   year.
5. To undertake research, studies, investigations, and other
   activities and projects, and to submit comprehensive reports and
   appropriate recommendations to the Board for its information and
   approval.
6. To perform such other duties as the Board may assign from time
   to time.

2. General Powers and Duties of the Assistant General Managers—

The Assistant General Managers shall be responsible to the
General Manager of the Authority, and shall have the following general
powers, functions, and duties:

1. To assist the General Manager in implementing, enforcing, and
   applying the policies, programs, guidelines, procedures, decisions,
   rules and regulations promulgated, prescribed, issued, or adopted by the
   Authority.
2. To assist the General Manager in the performance of his other
   functions and duties.
3. To perform such other duties as the General Manager may assign
   from time to time.

ARTICLE VI. CAPITAL, FINANCE AND ACCOUNTS

SEC. 10. Capital—

1. The authorized capital of the Authority shall be three billion
   pesos.
2. The initial paid up capital shall consist of:
   1. The value of assets (including port facilities, quays,
      wharves, equipment) and such other properties, movable and immovable as
      may be contributed by the Government or transferred by the Government or
      any of its agencies as valued at the date of such contribution or
      transfer and after deducting or taking into account the loans and other
      liabilities of the Authority at the time of the takeover of the assets
      and other properties
   2. The initial cash appropriation of P2 million out of the
      funds of the National Treasury and such further sums, including working
      capital, as may be contributed by the Government.

SEC. 11. Creation of Reserves—The balance of any revenue or
income of the Authority remaining at the end of each year shall be
applied to the creation of a general reserve or such other reserves as
the Authority may deem appropriate.

SEC. 12. Investment of Funds—The Authority 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 Authority in such government securities approved by the Board.

SEC. 13. Borrowing Powers—

1. The Authority 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.
2. All loans contracted by the Authority 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 Authority and shall rank pari passu with one another, but
   shall have priority over any other claim or charge on the revenue and
   assets of the Authority: Provided, That this provision shall not
   be construed as a prohibition or restriction on the power of the
   Authority to create pledges, mortgages and other voluntary liens or
   encumbrances on any property of the Authority.
3. Except as expressly authorized by the President of the
   Philippines, the total outstanding indebtedness of the Authority in the
   principal amount in local and foreign currency shall not at any time
   exceed the net worth of the Authority at the relevant time.
4. 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 Philip pines, the
   payments of the loans or other indebtedness of the Authority up to the
   amount herein authorized.
5. All interests paid or payable by the Authority on its loans or
   other forms of indebtedness shall be exempt from taxes of whatsoever
   nature.

SEC. 14. Annual Budget—

1. 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.
2. Supplementary estimates may be adopted at any of the meetings of
   the Board.

SEC. 15. Annual Accounts—

1. 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. The Authority shall
   maintain such accounts and other records under a commercial system of
   accounting.
2. The accounts of the Authority shall be kept and made up to 31
   December in each year.
3. The annual statement of accounts of the Authority shall present a
   true and fair value of the financial position of the Authority and of
   the results of the operations of the Authority for the year to which it
   relates.

SEC. 16. Auditor—

1. In consonance with existing laws and regulations, the
   Com mission on Audit shall be appointed to audit the accounts of the
   Authority. In the fulfillment of international contractual
   commitments of the Authority, 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 Authority.
2. The auditor shall be paid out of the revenue of the Authority
   such remuneration, compensation or expenses as the Board may determine.

SEC. 17. Auditor’s Reports—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.

SEC. 18. 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 Authority during the preceding year and
containing such information relating to the proceedings and policies of
the Authority.

ARTICLE VII. DUES AND RATES

SEC. 19. Dues—

The President of the Philippines
may upon recommendation of the Authority increase or decrease such dues,
collectible by the Authority to protect the interest of the Government
and to provide a satisfactory return on the Authority’s assets, and may
adjust the schedule of such dues so as to reflect the costs of providing
the services; Provided, however, that the rates of dues on all
the ports of the Philippines upon the coming into operation of this
Decree shall be those now provided under Parts 1, 2, 3 and 6 of the
Title VII of Book II of the Tariff and Customs Code, until such time
that the President upon recommendation of the Board may order that the
adjusted schedule of dues are in effect

SEC. 20.
Rates and Charges—

1. The Authority may impose, fix, prescribe, increase or decrease
   such rates, charges or fees for the use of port premises works
   appliances or equipment belonging to the Authority and port
   facilities provided, and for services rendered by the Authority or by
   any private organization within a Port District.

   Provided, that upon the coming into operation of this Decree
   the rates of storage and arrastre charges in all ports of the
   Philippines shall be those now provided under Parts 4 and 5 of Title VII
   Book II of the Tariff and Customs Code until such time when the
   President of the Philippines upon recommendation of the Board may order
   that the revised rates, charges or fees are in effect.

2. The Authority shall regulate the rates or charges for port
   services or port related services so that taking one year
   with another, such rates or charges furnish adequate working capital and
   produce an adequate return on the assets of the Authority. In
   regulating the rates or charges for individual ports the Authority
   shall take into account the development needs of the port’s
   hinterland.
3. All dues, fees, charges and other sums imposed and collected by
   the Authority shall accrue to the Authority and shall be disposed of in
   accordance with the provisions of this Decree.

SEC. 21. Remission of Dues, Rates, or Charges—

No
amount due in respect of dues, rates, or charges prescribed by the
Authority under this Decree shall be waived or reduced except:

1. Where the State has arrangements with a foreign government in
   respect of vessels belonging to that foreign government and such vessels
   are not normally engaged in the conveyance of cargo or passengers; and
2. For vessels seeking shelter from inclement weather or entering
   the port for medical help and other maritime necessity.

SEC. 22. Remedies for Nonpayment—If the master, owner, or
agent of any vessel refuses or neglects to pay on demand any dues,
rates, or charges made under this Decree or any part thereof, the
Authority may, in addition to any other remedy provided by law, distrain
or arrest on its own authority such vessel and tackle, apparel or
furniture belonging to the vessel, and detain the same until the amount
or amounts due have been paid.

SEC. 23. When Rates Payable
and Lien—

1. Rates or charges in respect of goods to be landed become
   payable immediately on landing such goods.
2. Rates or charges in respect of goods to be shipped are payable
   before the goods are loaded.
3. Rates or charges in respect of goods to be removed from the
   premises of the Authority are payable on demand.
4. For the amount of rates of charges leviable under this Decree in
   respect of goods, the Authority shall have a lien on such goods and
   is entitled to detain then until the amount of rates or charges is
   fully paid. Such lien shall have priority over all other liens and
   claims, except claims for duties and taxes due to the Government and
   expenses of the sale.

SEC. 24. Recovery of Lien—Without prejudice to the authority
and rights of the Bureau of Customs in the disposition of property in
Customs custody as provided for in the Tariff and Customs Code, as
amended, if any goods which have been placed in or on the premises of
the Authority are not removed therefrom within the prescribed period
after the legal permit for their withdrawal and/or release from Customs
custody, or the authority to load, in case of exports, has been issued
by the Bureau of Customs, the Authority, with the prior concurrence of
the Bureau of Customs, may dispose of any such goods in the manner as it
deems fit in order to recover the lien; Provided, That the
proceeds of the sale shall be applied in the following manner:

1. Firstly, in payment of duties and taxes due to the Government;
2. Secondly, in payment of expenses of the sale;
3. Thirdly, in payment of the rates, charges, and fees due to the
   Authority in respect of the goods;
4. Fourthly, in payment of freight, lighterage or general average,
   on the voyage of importation and in case of exports, in payment of
   domestic freight, lighterage and cartage, of which due notice shall have
   been given to the Authority;
5. And finally, in rendering on demand the surplus, if any, to the
   person legally entitled thereto: Provided, That in case no such
   demand is made within a period of one year from the date of sale of the
   goods, the surplus, if any, shall become part of the general funds of
   the Authority, whereupon all rights to the same by such person
   shall be extinguished.

SEC. 25. Exemption from Realty Taxes—The Authority shall be
exempt from the payment of real property taxes imposed by the Republic
of the Philippines, its agencies, instrumentalities or political
subdivisions; Provided, That no tax exemptions shall be extended
to any subsidiaries of the Authority that may be organized; Provided,
finally, That investments in fixed assets shall be deductible for
income tax purposes.

ARTICLE VIII. PORT
REGULATIONS

SEC. 26. Power to Make Port Regulations—

1. The Authority may, after consultation with relevant Government
   agencies, make rules or regulations for the planning, development,
   construction, maintenance, control, supervision and management of any
   Port or Port District and the services to be provided therein, and
   for the maintenance of good order therein, and generally for
   carrying out the purposes of this Decree.
2. The Authority may provide separate regulations for
   each category of ports or port districts.

SEC. 27. Dangerous Cargo—

1. The Authority may make regulations for the conveyance,
   loading, discharging and storage of dangerous goods within any port,
   port district, and the approaches to the port.
2. The Authority may provide separate regulations for each
   category of ports or port districts.

SEC. 28. Powers of Harbor Master—Further to the provisions
of any regulation under Sections 26 and 27 of this Decree, the Authority
thru the Harbor Master of a Port or Port District may:

1. Direct where any vessel shall be berthed, moored, or anchored
   and the method of anchoring within the port and the approaches to the
   port;
2. Direct the removal of any vessel from any berth or anchorage to
   another berth or anchorage and the time within which such removal is to
   be effected; and
3. Regulate the mooring of vessels within the port and the
   approaches to the port.

SEC. 29. Existing Regulations—Anything to the contrary
notwithstanding and until new rules or regulations are promulgated by
the Authority under Sections 26 and 27 of this Decree, the rules,
regulations or orders made under the Customs Code or any other law of
the Philippines relating to the matters covered by Sections 26, 27 and
28 shall continue to apply as if they were made under said sections and
any reference to a customs official or any other officials under any law
of the Philippines shall be deemed a reference to an equivalent
official of the Authority.

Article IX. TRANSFER OF
ASSETS AND LIABILITIES

SEC. 30. Transfer of Existing and Completed Physical
Facilities—In accordance with the transitory provisions of this Decree,
there shall be transferred to the Authority all existing and completed
public port facilities, quays, wharves, docks, lands, buildings and
other property, movable or immovable, belonging to these ports declared
as Port Districts for purposes of this Decree.

SEC. 31. Transfer of Intangible Assets—In accordance
with the transitory provisions of this Decree, there shall be
transferred to the Authority all intangible assets, powers, rights,
foreshore rights, interests and privileges belonging to the Bureau of
Customs, and Bureau of Public Works and other agencies relating to port
works or port operations, subject to terms to be arranged by and between
the Authority and agencies concerned. Any disagreement relating to
such transfer shall be elevated to the President for decision.

SEC. 32. Projects in Progress—In accordance with the
transitory provisions of this Decree, 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 Authority in accordance with the
agreement among agencies concerned. Any disagreement relating to such
transfer shall be elevated to the President for decision.

SEC. 33. Transfer of Liabilities and Debts—Upon the
transfer and acceptance by the Authority of the existing physical
facilities, intangible assets, and completed projects referred to in the
Sections immediately preceding, all debts, liabilities, and obligations
of the Bureau of Customs, the Bureau of Public Works, and other
government agencies or entities concerned in respect of such physical
facilities, intangible assets and completed projects within the Port
Districts shall likewise be transferred to or deemed incurred by the
Authority.

SEC. 34. The Philippine Coast Guard shall retain
ownership of its properties and facilities which are necessary for the
enforcement of laws, rules and regulations pertaining to safety of life
and property at sea (SOLAS) found within ports and port districts and
shall continue to administer, operate and maintain the same as well as
assume the obligations and liabilities pertaining to such properties and
facilities. All other properties and facilities of the Philippine Coast
Guard found within ports and port districts, including all obligations
and liabilities related thereto shall be deemed transferred to the
Authority in accordance with Section 33 of this Decree.

SEC. 35. Transfer of Staff—Officials and employees of
existing offices or agencies, or their subordinate units, which are
abolished or reorganized under this Decree may be absorbed by the
Authority on the basis of merit and fitness: Provided, That those
officials and employees who are deemed qualified under both the
Authority and the reorganized office, agency or unit shall have the
option to either transfer or remain in their present office, agency or
unit, or elect to be separated from the service with all the benefits
they may be entitled to under existing laws: Provided, further,
That those who do not qualify under the Authority shall be retained in
the office or agency in which the unit was abolished.

SEC. 36. Gratuity and Other Benefits—All officials and
employees whose services are terminated as a result of this Decree shall
be given gratuities equivalent to one month’s salary for every year of
continuous satisfactory service rendered but not exceeding twelve months
on the basis of highest salary received, in addition to whatever
benefits accorded to them by existing laws.

ARTICLE X. CONSTRUCTION AND DREDGING WORKS

SECTION 37. Construction and Dredging Works—

1. The Bureau of Public Works shall be the executing agency of
   the Authority for the detailed design, contract document preparation and
   advertisement, construction supervision of port terminal facilities and
   port works, and the dredging of public ports vested in the Authority; Provided,
   That when there are no qualified bidders and for projects less than two
   hundred thousand pesos (P200,000 00) the Bureau of Public Works may
   undertake the construction through force account: Provided, further.
   That the Authority shall perform rehabilitation or maintenance works
   (including maintenance dredging) by its own personnel or private
   contractor, whichever arrangement is more advantageous to port and
   shipping operations.
2. The Authority shall be responsible for the allocation and
   control of all funds for the execution of all construction,
   rehabilitation and maintenance works mentioned in the preceding
   paragraph.

ARTICLE XI. FINAL PROVISIONS

SEC. 38. Transitory Provisions—

1. Until the President declares the Authority to be fully
   operational, the Bureau of Customs and the Division of Ports and Harbors
   of the Bureau of Public Works may continue to perform, in coordination
   with the Authority, such port operations and port works as may be
   deemed necessary by the Authority: Provided, always, That the
   Authority may also, at any time as it deems necessary, under take the
   phased or gradual takeover of such port operations or port works.
2. The budget for staff operations and other expenses relating to
   port operations or port works of the Bureau of Customs or the Bureau of
   Public Works, as the case may be, during such transitional period,
   shall be submitted by them to the Authority for information and guidance
   before implementation.
3. All expenses and charges relating to part operations and port
   works during the transitional period shall be paid out of the funds of
   the Authority or such other funds as may be allocated to the Authority
   in the Annual Appropriations Act or other sources. For this purpose,
   the current budget provisions, funds and allocations of the Bureau of
   Customs, the Bureau of Public Works and other government agencies
   concerned, pertaining to the expenses, including retirement funds, for
   personnel involved in port planning, maintenance and operations, the
   outlays for port works and port development, the existing balances as
   well as subsequent collections from port operations shall be transferred
   to the Authority in accordance with transfer arrangements to be
   negotiated by and among the agencies concerned: Provided, however,
   That in case of disagreement relating to such transfer, the same shall
   be elevated to the President for decision: Provided, further That
   all transitional arrangements including transfers of property, funds,
   rights, powers and liabilities under this Decree shall not extend beyond
   Fiscal Year 1977.

SEC. 39. Bureau of Customs—The Tariff and Customs Code is
hereby modified or amended to the extent that all the powers, duties and
jurisdictions of the Bureau of Customs concerning the following matters
shall be transferred to and be vested in the Authority:

1. All dues, fees and rates collectible under Title VII but
   excluding Part VII of the Code;
2. The general supervision, control, and regulation of all matters
   and affairs that pertain to the operation of and the issuance of
   permits or licenses to construct ports, port facilities, warehouses,
   and other facilities within port districts;
3. All such other powers, duties and jurisdictions vested in
   the Bureau of Customs pertaining to every matter concerning port
   facilities, port operations or port works.

SEC. 40. Other Laws—Any and all other powers and rights,
duties and functions and jurisdictions vested in and all properties and
appropriations of any government agency, authority or instrumentality
pertaining to every matter concerning port facilities, ports operations,
or port works shall be transferred to and be vested in the Authority.

SEC. 41. Repeal—All laws, decrees, Letters of
Instructions, orders, rules and regulations, policies, programs or parts
thereof inconsistent with or contrary to any of the provisions of this
Decree are hereby repealed or modified, including but not limited to the
following:

1. R.A. No. 4567 creating the San Fernando Port Authority and
   R.A. No. 4663 as amended by R.A. No. 6086 creating the Cagayan de Oro
   Port Authority.
2. Sections 26 and .27 of Presidential Decree No. 458.
3. Act No. 3592 as amended, creating the Port Work Fund.
4. Presidential Decree No. 505.
5. Section 711 as far as Port Administration is concerned.
   Section 3304 and such other inconsistent provisions of the
   Tariff and Customs Code without prejudice to the provisions of
   Section 38 of this Decree.
6. Section 3 (a) as far as it concerns stevedoring, arrastre
   and customs brokerage services and the whole of Section 11 (c) of
   Presidential Decree No. 474 creating the Maritime Industry Authority.

SEC. 42. Separability Clause—If, for any reason, any
section or provision of this Decree is declared to be unconstitutional
or invalid, the other sections or provisions of this Decree which are
not affected thereby shall continue in full force and effect.

SEC. 43. Penalties—

1. Any person who violates any of the provisions of this Decree or
   any of the rules and regulations issued or promulgated by the
   Authority, shall be punished by imprisonment for not less than one day
   but not more than six years, and pay a fine of not less than two hundred
   pesos but not more than one hundred thousand pesos. If the offender is
   a government official or employee he shall, in addition to
   imprisonment and fine be perpetually disqualified to hold any
   public office. If the offender is a juridical person, the penalty of
   imprisonment and fine shall be imposed upon its manager, director,
   representative or employee thereof responsible for the
   violation. If the offender is an alien he shall be deported
   immediately without further proceedings, after serving his sentence
   and paying the fine.
2. Any license, franchise, authority or permit to exercise any
   right in privilege, which may have been issued by the Authority in
   accordance with this Decree or the rules and regulations issued or
   promulgated pursuant to this Decree, shall be deemed withdrawn and
   revoked upon conviction of the holder thereof.

SEC. 44. Effectivity—This Decree shall take immediate effect
upon its promulgation.

Done in the City of Manila, this 23rd day of December, in the year
of Our Lord, nineteen hundred and seventy-five.