Philippine Domestic Shipping
Transport Industry: State of Competition
and Market Structure
Myrna S. Austria
PHILIPPINE INSTITUTE FOR DEVELOPMENT STUDIES Surian sa mga Pag-aaral Pangkaunlaran ng Pilipinas
RESEARCH PAPER
SERIES No. 2003-02
The author is Director of the Center for Business and Economics Researchand Development, De La Salle University – Manila. This paper was madepossible through a financial assistance from the Philippine APEC StudyCenter Network (PASCN).
She would like to acknowledge the able research assistance provided byMs. Thea Lazaro.
Myrna S. Austria
RESEARCH PAPER SERIES NO. 2003-02
PHILIPPINE INSTITUTE FOR DEVELOPMENT STUDIESSurian sa mga Pag-aaral Pangkaunlaran ng Pilipinas
Philippine Domestic ShippingTransport Industry: State of Competition
and Market Structure
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The shipping transport industry plays a very important role in the country’sdevelopment. Considering the archipelagic setting of the country, shippingprovides the primary means of interisland transport. That is, the bulk ofdomestic trade is transported by shipping; interisland travel, especially inthe southern part of the country, is also largely dependent on shipping.Considering this role, an efficient shipping industry that facilitates themovement of commodities, products and people is vital to the growth of thecountry. This is one where passengers and cargoes get to their destinationson time and in good and safe condition at the least possible cost. For cargoes,especially agricultural commodities, the transport should be in a mannerwhere their physical condition at their place of destination allows them to bemarketed at the most competitive price.
The country’s domestic shipping industry, however, has been regardedas inefficient. This is rather unfortunate as the industry has a large numberof shipping companies where competition could be expected to be a powerfulforce for eliminating inefficiency. Past studies suggest the underlyingexplanation has much to do with government regulations and policies affectingthe industry.
The industry had been highly regulated until policy reforms wereinstituted in the 1990s in response to the continuing inefficiency. This studyexamines the inefficiency of the industry in terms of the complex interactionbetween regulation and competition; and then analyzes the effects of thepolicy reforms on competition and market structure. The scope of the paperis limited to the interisland liner shipping industry because this is the sectorwhere regulation is highly concentrated and whose viability is highly sensitiveto government policy.
The paper is organized as follows. Section 2 provides a brief profile ofthe industry. Section 3 discusses the contestability of markets in the shippingindustry, including the arguments for and against regulating the industry.Section 4 examines the regulatory framework and policies prior to theimplementation of the policy reforms. This is followed by a discussion of thepolicy reforms made through liberalization and deregulation in Section 5.
1
I
�
Introduction
2
Section 6 is an analysis of the effects of the reforms on market structure andcompetition, including the impact of competition on efficiency. Section 7 is adiscussion of the role of the MARINA in a deregulated environment. Areasfor competition policy and further reforms are then identified in Section 8.The summary and conclusions are presented in Section 9.
Philippine Domestic Shipping Transport Industry
Marine or shipping transport services consist of three types of activitiesnamely, maritime transport services, maritime auxiliary services and portservices (Fink, Mattoo and Neagu, 2000). Marine transport refers to the actualtransportation service performed once the commodity or passenger is onboard a ship until the ship reaches its port of destination. Marine auxiliaryservices refer to activities related to cargo manipulation in ports and on ships.Under the General Agreement on Trade in Services (GATS) classification,these include cargo handling, storage and warehousing, custom clearance,container station and depot, maritime agency and freight forwarding. Onthe other hand, port services refer to those activities related solely to shipmanagement in ports. Under GATS classification, these include pilotage,towing and tug assistance, provisioning, fuelling and watering, garbagecollecting and disposal, port captain’s services, navigation aids, shore-basedoperational services and emergency repair facilities. This paper willconcentrate on marine transport, as the other two types of activities haveseparate issues of their own.
The country’s domestic marine or shipping transport is composed ofthree sectors: liner, tramp and industrial carriage. Liner shipping refers to theoperation of domestic water transportation that offers their services to thepublic without discrimination to any user, have regular ports of call andhave fixed sailing schedules and frequency. Tramp shipping, on the otherhand, refers to the operation of freight vessels that are not plying a regularroute but are hired on a contractual basis by shippers under mutually agreedterms and usually carry cargoes of bulky commodities. Industrial carriagerefers to the shipping operations of companies arising from the necessity tocater to the needs of their own enterprises. Of the three sectors, only linershipping is regulated by the government.
The shipping transport industry contributes about half a percent to thecountry’s gross domestic product and this share has remained unchangedthroughout the 1990s (Table 1). Passenger traffic carried by liner shipping
3
II
�
Domestic Shipping Transport Industry:Brief Profile
increased from almost 30 million in 1990 to 44.4 million in 2000, registering a4.05 percent average annual growth rate during the period (Table 2). Thevolume of domestic cargo carried also went up from 58 million metric tonsin 1990 to 76.9 million metric tons in 2000 or a growth rate of almost 2.87percent per year.
The domestic shipping industry also plays an important role in thecountry’s international trade by carrying, between ports in the country,cargoes intended for exports and cargoes arriving as imports, or what arereferred to as transit cargoes. Between 1991 and 1998, transit cargoes grewfrom 597.5 thousand metric tons to 757.3 thousand metric tons or by 2.67percent per annum (Table 2).
The domestic shipping fleet is dominated by general cargo in terms ofgross registered tonnage (GRT) (Figure 1). Starting 1993, the domestic fleet,particularly passenger cargo and general cargo, registered a big increase intonnage such that the capacity of the industry was growing much faster thanthe passenger and cargo traffic generated (Table 3). Also very striking wasthe large drop in the average age of the passenger cargo fleet (Table 4). Aswill be discussed in Section 6 of the paper, all these changes have much to dowith the liberalization and deregulation measures instituted in the industryin the 1990s.
Liner shipping routes are classified as primary, secondary, tertiary anddevelopmental routes. The classification is based on ports being served, popu-lation and economic development in the area, and the cargo/passenger
4
Philippine Domestic Shipping Transport Industry
Table 1. Gross value added in water transport (million pesos at constant 1985 prices)
Year Gross value added % Share to GDP
19901991199219931994199519961997199819992000
4,1973,7243,6963,7113,7703,8764,0204,2094,3254,4444,518
0.60.50.50.50.50.50.50.50.50.50.5
Sources: 1999 NSO Phil. Statistical Yearbook; National Income Accounts of the Philippines
Domestic Shipping Transport Industry: Brief Profile
5
Notes:(1) The 1996 inventory does not include vessels with sizes 3 GT and below such that the resultingfigures turned out to be smaller than the 1995 figures, thereby rendering the statistics non-comparablefor purposes of trend determination.(2) “Others” include liquid cargo/ lighterage, barging, tanker, towing, salvaging, pleasure, pilotage, andothers with no information.Source: MARINA Domestic Fleet Inventory
Figure 1. Total GRT of domestic merchant fleet, type of service, 1990-1999
Table 2. Domestic Passenger and cargo traffic, 1990-2000
Year PassengerCargo (metric tons)
Domestic Transit cargo
19901991199219931994199519961997199819992000
1990-2000
29,820,02531,715,98333,734,54736,365,33240,444,60737,873,20540,043,00641,414,64744,110,79043,228,47844,371,866
4.05
57,956,40158,634,41161,845,50565,072,55071,108,39268,100,65471,955,59476,150,04174,928,05876,538,89576,914,255
2.87
N A597,467230,863267,765232,839133,617662,961650,822687,369933,691757,272
2.67Average annual growth rate (%)
Notes: (1) NA means not available (1990 domestic cargo data includes both domestic and transit cargo)(2) Average growth rate for transit cargo from 1991-2000
Source: NSO Philippine Statistical Yearbook
6
Philippine Domestic Shipping Transport Industry
throughput attendant to the linkages fostered. Primary routes include thosethat handle domestic volume of national significance and usually cover themajor ports of the country. Secondary routes include those that handle do-mestic volume of regional significance and are linked to ports of lesser through-puts than major ports. Tertiary routes are feeder routes that handle cargoesconsolidated and destined for primary and secondary ports. Finally, devel-
Table 3. Annual growth rate of traffic and capacity (%)
YearPassenger Cargo
Capacity Traffic Capacity Traffic
1990-911991-921992-931993-941994-951995-971997-981998-99
34.71.10.6
47.710.414.410.30.2
6.46.47.8
11.2-6.49.46.5
-2.0
21.8-2.82.1
22.20.7
-22.123.418.4
2.24.85.39.2
-4.412.6-1.52.5
Notes: Data for 1996 not included. Capacity is based on passenger cargo GRT for passenger and general cargo pluscontainer GRT for cargo.Sources: MARINA (for GRT); Philippine Statistical Yearbook (passenger traffic)
Table 4. Average age of domestic merchant fleet, by type of service, 1990-1999
Year Passenger ferry Passenger Cargo General Cargo Container Ave. Merchantfleet
19901991199219941995199719981999
10.709.599.277.789.617.638.269.98
20.6928.0328.4214.9414.838.989.409.27
7.108.028.66
10.1110.0612.1412.1013.12
21.1624.9025.7424.2423.9523.4022.4224.65
9.8610.9011.3011.2911.6111.8612.1112.08
Notes:(1) The 1996 inventory does not include vessels with sizes 3 GT and below such that the resulting figures turned outto be smaller than the 1995 figures, thereby rendering the statistics non-comparable for purposes of trend determination.(2) No data available for 1993.Source: MARINA Domestic Fleet Inventory
Domestic Shipping Transport Industry: Brief Profile
7
opmental routes do not have existing shipping operators but shipping opera-tions are economically desirable because of their potentials in agriculture,tourism or mining. Operation along these routes, during the initial stages, isnot financially viable.
III
�
Contestability of Marketsin the Shipping Industry
The literature on contestability of markets points to the importance of thethreat of competition, as distinct from actual competition, in enforcing goodbehavior and conduct among firms in the industry (Hanlon 1996). This kindof market is characterized by the following: (i) there are no barriers to entry,that is, no extra cost borne by new entrants that are not borne by the incum-bents; (ii) there are no sunk costs, that is costs that cannot be recouped whena firm withdraws from the industry; (iii) the time for the incumbents to changetheir price in response to the entry is longer than the time for the new entrant tomake profits. According to this theory, firms in oligopolistic industries willstill price at the same level as they would in a perfectly competitive market solong as the threat of competition exists. In other words, under this market, theincumbents can protect themselves from new competition only by behaving well.
A contestable market offers to consumers and the society similar benefitsfrom a perfectly competitive market (Baumol and Lee 1991). Because of thethreat of competition, firms cannot charge higher-than-competitive prices orearn excessive profits; any attempt to do so would invite new entrants toundercut the incumbents’ prices to a level that could still give them attractivereturns. Waste and inefficiency beyond that which is allowed by the currentof state of technology and level of knowledge are also avoided as these wouldbe reflected in higher costs and prices, the presence of which would invitethe entry of efficient firms. Likewise, predatory pricing and cross-subsidypricing are prevented. Predation becomes unattractive since it can only bedone if there is a prospect for making future profits large enough to recouplosses made when prices or profits were kept low to drive competitors ornew entrants away; but then excessive profits would invite entry. Cross-subsidyoccurs when a firm charges a price below cost to a particular group of custom-ers and the loss is made up for by charging excessive prices to other customers.This is not feasible under a contestable market as the excessive price wouldinvite new entrants who can sell at a lower price level. In effect, the newentrants are capturing from the incumbents the earnings that were previouslyused for cross-subsidy.
8
Arguments for and against regulating the shipping industryThe shipping industry is a highly contestable market in the absence of gov-ernment regulations that prevent market forces take their course on the func-tioning of the industry. The common argument for the need to regulate linershipping is based on the supposed danger of chronic instability due to inher-ent tendencies toward ruinous competition and monopoly (Renardet SautiConsulting Engineers 1986). That is, the industry is highly vulnerable to priceand capacity fluctuations that lead to ruinous competition and eventually tomonopoly, after the weak firms are driven out.
Price instabilityThe vulnerability to price and capacity fluctuations, if there are no limits tocompetition, is argued to be associated with the cost structure of the indus-try. Once a vessel is at berth, the only cost associated with carrying an extraton of cargo is the cost of loading and discharging it; and such marginal costis very low, an average of about 25-30 percent of the freight rate. At suchrate, an operator cannot survive. Hence, an operator will find it profitable totake an extra cargo at a rate higher than the handling cost. However, if thereis free competition, the rate would be forced to go down to the level of thehandling cost whenever there is any surplus in capacity. The industry willthen become unprofitable for all operators.
However, it is also argued that the above argument is not plausible asshipping operators do not in practice cut their rates to the level of marginalcosts once the ship is at berth. Instead, what influences the behavior of op-erators is not the marginal cost of an extra ton of cargo, but the cost of anextra voyage or set of voyages and their relation to revenues at pre-deter-mined rate levels.
Nevertheless, pricecutting is practiced but only in so far as there is over-capacity or overtonnaging in the industry. And this can lead to rate instability.
MonopolyAnother argument for government regulation is the danger of monopoly. Anatural monopoly occurs when there are economies of scale that allows alarge company to charge lower prices because its unit costs are lower than asmall company. This will eventually drive small firms from the market. Inshipping, the lower unit costs may arise from larger ships or from a largernumber of ships.
It is also argued, however, that there are no significant economies ofscale in the shipping industry (Renardet Sauti Consulting Engineers 1986) orthat economies of scale is not a significant barrier to entry in the industry
9
Contestability of Markets in the Shipping Industry
10
(Dick 1987). While a larger vessel will generally give lower costs per ton thana small ship, the cost advantage of larger vessels is offset by two factors.One, cargo handling rates increase less than proportionately with ship size,so that the larger ship tends to spend a larger proportion of its time in port.Two, smaller ships are able to provide more frequent service because of theirfaster turnaround. Hence, small ships can operate alongside with larger ships.
On the number of ships, a large fleet will not necessarily have lowercosts per ton than a small fleet. More than 80 percent of a shipping company’soperating costs are ship operating costs, the rest being terminal and adminis-trative costs. Thus, if a company increases its fleet by 20 percent, its operat-ing cost is expected to increase by the same amount (Renardet Sauti Consult-ing Engineers 1986).
Furthermore, economies of size appear to be insignificant beyond aboutthree ships, while diseconomies seem to occur beyond about 10 ships (Dick1987). This is attributed to managerial diseconomies of scale. Shipping com-panies are said to be difficult to manage because the locations of the headoffice, branch office and terminals are so dispersed. Profitability is highlydependent on capacity utilization, which in turn depends on port turnaround.This would then require some kind of loyalty to the shipping company ofofficers and crew to cooperate in speeding up turnaround. As a general rule,however, officers and crew would prefer a longer to a shorter stay in port.Hence, to increase turnaround and productivity, some kind of incentive anda good wage structure is required. In family shipping businesses, the practiceis to appoint family members to man the day-to-day operations of the busi-ness across various ports. However, as the number of ships, routes and portsincreases, the problem of control and management seems to increase dispro-portionately.
Competition in shippingRate discounting, particularly on freight rates, is a common practice in theindustry. Even when there are government regulations on rate setting, theofficial rates become just a benchmark or a base from which to discount.Actual freight rates are usually the product of bargaining between shippersand shipping operators (Dick 1987). Discount comes in various forms likeunderrecording the weight or volume of the cargo or declaring the cargo asa low-value item. Since such practices do not involve a reduction in freightrate as reflected in the bill of lading, shipping companies can make it appearthat they are following the official rates.
Discounting drives up price competition in the industry. To lessen thepressure for rate discounts, shipping companies with established financial
Philippine Domestic Shipping Transport Industry
11
position offer longer terms for payment. But on the other hand, forwarders,traders and large companies that distribute their own products can makebargains for large discounts by offering a contract for their cargoes for afixed period. Guaranteed by the security of a contract and a large volume ofcargoes, a shipping company can thus settle for a low margin for its shippingrates.
The disadvantage of competing through rate discounting, however, isthat any discount can readily be matched by competitors. Thus, in the face ofintense rate competition, the best strategy for a shipping company is to tryand become the market leader in terms of quality of service. In practice,freight rates are not the primary but the balancing item in the services nego-tiated with shippers, as shippers and traders are more concerned with thesafety of their cargoes. That is, the cost of a late or damaged cargo could bemuch more than the savings from a small discount in freight rate.
Thus, competition in shipping is primarily in terms of quality of service.A good reputation for reliable service can insulate shipping companies fromintense competition in freight rates and can allow them to charge a premiumrate and earn a more than normal profit. But such cannot last long as thepremium invites other companies to improve on the quality of their service.However, in times of excess capacity when rate cutting is prevalent, compa-nies with good reputation are able to keep their share of the market whilecompanies offering not so reliable service destroy each other in a fight forthe crumbs. In practice, rate cutting is prevalent only among firms at thelower end of the market offering the poorest service and struggling to survive.
Contestability of Markets in the Shipping Industry
12
IV
�
Regulatory Framework and Policies:Prereform Period
Regulation of the domestic liner shipping industry was first introduced inthe country during the American colonial rule. In fact, the pattern of theearly regulations closely resembled those that applied to American railroadsand motor trucking industry. The then Board of Transportation (BOT) wasin charge of regulating the industry until the Maritime Industry Authority(MARINA) took over the function in 1985. Regulation covers route entry andrate/tariff determination.
Liner rate regulationsRegulations for liner rates began in 1928. The objective was to protect thepublic from indiscriminate charging by shipping companies and, at the sametime, protect the investment of liner operators by preventing ruinous compe-tition. Rates, or what are commonly called as tariffs, were fixed by the gov-ernment. To simplify the task of setting rates for a large number of com-modities or passengers, rates were structured by commodity or passengerclass. Commodities were initially classified as Class A for processed goodsor high value manufactured goods, Class B for semiprocessed goods or lowvalue manufactured goods, Class C for unprocessed commodities and Basicfor rice, palay, corn, corngrits, fruits, vegetables and livestocks. As will bediscussed later, some of the Basic commodities were reclassified when policyreforms were introduced into the industry. Passenger services, on the otherhand, were classified as First Class, Second Class and Third Class dependingon the kind of services and accommodation offered. Starting in 1983, thetariff structure for both passenger and cargo provided different rates withrespect to three distance ranges namely, 0-100 miles, 101-300 miles and over300 miles.
The tariff structure prescribes a set of formulae for user charges thatvary in accordance with the commodity classification or service class of pas-sengers and the direct distance between the ports of origin and destination.
13
Regulatory Framework and Policies: Prereform Period
The formula for cargo rates has a fixed and distance-related component whilethe passage rate only has a distance-related component. The fixed compo-nent reflects the cost of the vessel while loading or discharging in port and itis computed in pesos revenue per ton. On the other hand, the variable ordistance-related component reflects the cost of the vessel's time while at seaand is computed in pesos per revenue ton mile or pesos per passenger mile.A revenue ton is either a measurement ton of one cubic meter, or a weightton of 1000 kilograms, whichever gives the higher revenue to the shippingoperator.
The first rate formulae instituted in 1928 were originally cost-based,with a uniform tariff per nautical mile for most cargoes. Cost-based tariff isone which passes on the costs of providing the service to shippers withoutdiscriminating between cargoes. By the 1980s, however, the rates were bothcost- and value-based in that while the fixed and variable components wereretained, high-value goods had higher rates than low-value goods. Such prac-tice allows the cross-subsidization of the shipment of low-value goods.
For cargo rates, there was an alternative to the class rates. The lineroperators had the option to charge an ad valorem rate on any goods valuedat over P1,000 per ton. The original objective was to limit the ad valorem ratesonly on very high value goods, but with the passage of time and as inflationincreases the prices of all commodities, the ad valorem option became appli-cable to more and more commodities. The rate was 0.5 percent in 1928 and atthat time, it excluded almost all goods in the interisland trade. By the 1980s,however, the threshold included most commodities.
Throughout the period 1928-1985, the basic structure of tariffs remainedlargely unchanged (Renardet Sauti Consulting Engineers 1986). Only the levelof rates changed by periodic across-the-board increases, basically to reflectchanges in inflation rate. For the ad valorem rate, the rate is increased by thesquare of the inflation rate. The rate first increases automatically as the priceof the cargo increases and then a second time with the official increase in thead valorem percentage rate. From 0.5 percent in 1928, the rate had risen to7.3 percent by 1989. In the 1980s, the ad valorem rate became so high that itrepresented serious deviations from appropriate charges based on shippingcosts (PTF 1989).
For the class rates (passage and freights rates), upward adjustmentswere made using the revenue deficiency method. Under this method, rateadjustments are made based on the revenues that need to be generated byliner operators to provide a rate of return (ROI) consistent with Common-
wealth Act No.146 or the Public Service Act of 1936. The Act declared theprovision of shipping services, along with other services1, as a public service.The maximum allowable ROI for public utilities was 12 percent and it hasremained at this level until today. Under the revenue deficiency method, therequired revenue is compared to the actual revenue (based on audited finan-cial statements provided by the ship operators), and the difference indicatedthe deficiency in rates.
The method is too dependent on the financial reports of shipping op-erators. Before the reforms were instituted, MARINA combined the finan-cial statements of all members of the Domestic Shipping Association (DSA) toget the average for the industry from which to base the increase and thenapply an across-the-board rate increase. The method does not consider aver-age load factors and degree of efficiency of operations such that even if loadfactors are low and vessel operation is inefficient, rate increases were ap-proved so long as revenue was insufficient to obtain the prescribed ROI.Thus, even inefficient firms, which would normally be driven out of the in-dustry if market forces are allowed to operate, were made to earn profits.Since the method guarantees operators of profits regardless of their perfor-mance, there is no pressure on the part of shipowners to search for moreefficient means of meeting the country’s demand for shipping services(Balisacan 1989). Worse, the method has made the level of shipping rates toohigh over the years. It resulted in rates that did not consider the actual costof providing cargo or passenger services.
While the government fixed the rates, enforcement was weak or mini-mal. Because the rates were too high (both ad valorem and class rates) andthe enforcement was weak, discounting became the rule. A discount of 15-25percent was common in the 1980s (Nathan Associates 1991).
At the same time, however, the freight rates for Basic commodities andthe passage rates, particularly for the Third Class, were not permitted toincrease as rapidly as the general inflation rate, for social reasons.
Route licensingOriginally, the shipping industry was exempted from government regulationunder the Public Service Act of requiring operators of all public service toobtain a certificate of public convenience (CPC) (Chapter II, Section (13a) of
Philippine Domestic Shipping Transport Industry
14
1 Also included as public service are any common carrier, railroad, street railway, subway or motor vehicle engagedin the transportation of passengers or freight or both, shipyard, marine railways, wharf or dock, ice plant, ice-refrigerationplant, canal, irrigation system, gas, electric light, water supply and power, petroleum, sewerage system, wire orwireless communication system, broadcasting stations and other similar public service.
Regulatory Framework and Policies: Prereform Period
15
the Act). A CPC is an authorization to operate a public service; and in thiscase, the authorization to a vessel for domestic water transportation servicesfor commercial use. Route licensing, however, was introduced in 1972. Thecommonly accepted reason for its introduction was that the major routeswere overtonnaged while many of the other routes were inadequately servedor had no service (Nathan Associates 1991). The objective therefore of regu-lating entry was to bring capacity and demand into balance.
For a CPC to be granted, the following requisites must be compliedwith:· The applicant must be a citizen of the Philippines, or a corporation or
a co-partnership, association or joint-stock company constituted andorganized under the laws of the Philippines, at least 60 percent of thestock or paid-up capital belongs entirely to Philippine citizens;· The applicant must be financially capable of undertaking the proposed
shipping service and of meeting the responsibilities incident to itsoperation; and,· The applicant must prove that the operations of the public service
proposed and authorized to do business will promote the publicinterests in a proper and suitable manner.
CPCs are given on a vessel-to-vessel basis, specifying the exact routeand schedule. There was a deliberate policy, throughout the pre-reform pe-riod, of limiting competition by restricting market entry. The general prin-ciples for issuing a CPC were prior-operator, prior-applicant and protectionof investment or what are commonly referred to as "grandfather rules." Theprior applicant rule means that priority is given to the first applicant, amongthe various applicants, for a CPC. Prior operator rule means the priority isgiven to an existing authorized2 operator in a route, and in each segment ofthe route, by virtue of a CPC or provisional authority (PA) issued. On theother hand, protection of investment rule means the protection and conser-vation of investment that have already been made by operators.
Following are the two types of application for a license:· An application for a route for which the applicant/operator has no
franchise, i.e. new entrant in a route.If the route being applied for is already serviced by a franchised3
operator, the BOT/MARINA conducts a market evaluation upon re-ceipt of an application for the route to see if the entry of additional
2 An authorized operator is one who has been issued either a certificate of public convenience (CPC) or provisionalauthority (PA).3 A franchised operator is one that has been issued a certificate of public convenience (CPC).
operators in the route is justifiable. If the demand warrants addi-tional fleet, the application is not immediately approved. The existingoperator is first given the priority to put in additional vessel/s tomeet the demand; only when he cannot meet the demand within sixmonths will the application of a new operator is approved.
However, if the route is already served by nonfranchised opera-tors, the "prior applicant rule" applies.
For a development route, entry is allowed and the new entrant isprotected in his investment by not allowing another operator to plythe same route until such time that he has recovered his investment.Since there was no limit in the number of years by which the operatoris protected to recoup his investment, there was no incentive for himto make his operation efficient. On the other hand, if market condi-tions warranted additional tonnage, entry was open to additionaloperator/s, but subject to the "prior operator rule." That is, prioritywas given to the original operator to put in the additional tonnage.· An application to expand capacity in a route for which the operator
already has a franchise.If the demand called for additional capacity, a franchised opera-
tor was allowed to increase 50 percent to his capacity, at minimuminterval of three years. If there were several existing franchisedoperators in the same route, the "prior-applicant rule" applied.
However, in all the above rules, the past service records of theoperator/s or the new applicant/s were not taken into consideration.
During the early years of franchising, compliance was low. Some linersdid not register and those that did were issued CPCs that did not specifytheir routes (1986 study). In 1977, a freezing program was introduced in theindustry through Memorandum Circular (MC) No. 11 with the aim to controlovertonnaging in the industry. Under the program, all operators were sup-posed to secure provisional authority to operate. But there was confusion inthe administration of franchising. Prior to assuming the full responsibility ofhandling franchising, MARINA served as the technical arm of the BOT. Butsince MARINA and BOT issued approvals independently of each other, theprogram did not improve the capability of the government to control andmonitor capacity.
In 1978, MC No. 16 was issued declaring a policy to protect establishedshipping companies already providing adequate service from undue compe-tition. Under the policy, no new operator was allowed to enter primary andsecondary routes and only one operator was allowed for the tertiary route.Where there was more than one existing operator in a tertiary route, merger
16
Philippine Domestic Shipping Transport Industry
17
or joint services was promoted or encouraged. MC No. 26, issued in 1982,introduced the rationalization of the interisland shipping operations. Amongother things, the circular required all operators (i) to observe their autho-rized routes, sailing frequency and schedules, and that any deviation fromsuch without appropriate authority shall be penalized; (ii) not to abandon,withdraw or suspend service without authority from the BOT; and (iii) notto reroute vessels and doing so was illegal if pursued without an amendmentof the CPC. Under the circular, too, acquisition of new vessels was regulated,limiting it only to the modernization of tonnage in the route and giving pri-ority to existing operators. 4
Impact of and problems arising from government regulationsThe past regulations of the domestic shipping industry had adverse im-pact on the economy. This is well documented in the findings of severalstudies and is summarized in this section. These documents include theInterisland Shipping Regulation Study prepared by the Renardet SautiConsulting Engineers in 1986; findings of the Presidential Task Force (PTF)on Interisland Shipping Industry in 1989; the Philippine Transport SectorReview in 1990; and the studies prepared by Nathan Associates, Inc., theInterisland Liner Shipping Rate Rationalization Study in 1991 and the LinerShipping Route Study in 1994.
OvertonnagingAs discussed earlier, regulating the routes was meant to reduceovertonnaging of the industry. Over the years, however, onvertonnaginghas persisted. This was manifested in low load factors in most cases. Inshort, route franchising did not succeed in bringing capacity and demandon balance although it moderately succeeded in limiting overtonnaging inindividual routes.
Several factors contributed to the persistent overtonnaging. Route fran-chising can only deal with the distribution of capacity between routes but not onthe absolute level of capacity of the industry. That is, if a vessel was refusedentry in one route, it could find its way in another route; or if it was with-drawn from a particular route, it was only rerouted to another route. Hence,the overall capacity of the industry was maintained or even increased if the
4 Acquisition of new vessels is allowed if it can be proven that there is general deterioration of services in terms of quality andreliability. All existing operators are given equal opportunity and advance notice on the need to modernize; and if noapplication is received within six months, application from new entrants are entertained on a first come, first servedbasis.
Regulatory Framework and Policies: Prereform Period
18
Philippine Domestic Shipping Transport Industry
vessel involved was new. The origin of overtonnaging is at the vessel importapproval stage. In the past, refusal of import approvals rarely happened.
The 12 percent cap on the return on investment is also said to havecontributed to the overtonnaging of the industry. One practice in the industryto circumvent the cap is for shipping operators to horizontally expand byacquiring more vessels thereby increasing their assets, which in turn, formpart in the computation of the required revenue to obtain the ROI. Suchpractice does not promote efficiency where the use of vessels is maximizedat the least cost. Additional vessels and tonnage should be dictated by anincrease in demand and not by the desire to meet the prescribed ROI.
The high rates arising from the revenue deficiency method also causedthe overcapacity in the industry. The high rates were sufficient to guaranteeprofits even at low load factors.
Flaws in the tariff structureThe tariff structure established in 1928 suffered from major flaws. First, therate differentials between classes did not reflect differences in the cost ofproviding services for each commodity group but instead it was an attemptby the government to incorporate consideration of "what the market willbear" into the regulation process. The product value was generally supposedto indicate what the market would bear as a proxy for price elasticity ofdemand for the product. As discussed below, this resulted to the discrimi-nation of some commodities and particular routes in the provision of ship-ping services.
Second, the commodity classification was also problematic as rates forsome commodities were set too low thus, failing to ensure the availability ofsufficient services at all times. This was true, in particular, for the Basiccommodities. At the same time, rates for other commodities were set toohigh to permit them to bear the charges.
Third, the application of a uniform rate formula for all routes wasinappropriate as it did not consider both cargo inflow imbalances and cargomixes. The unit cost per ton of cargo increases as capacity utilization falls.High capacity utilization rate cannot be achieved if there are large imbal-ances in the inbound and outbound traffic. Hence, rates for routes with agood balance of traffic in the two directions were not appropriate for routeswith large imbalances. Also, the mixture of class of commodities determinedthe earning potentials of the routes. Hence, routes with a high proportion ofClass A or Class B commodities in the total cargo traffic had higher earningpotentials than routes with a higher proportion of Class C (Basic) com-modities.
19
Regulatory Framework and Policies: Prereform Period
Effects on the economyThe flaws in the tariff structure and rate setting created adverse effects onthe economy. In general, the adverse effects fell disproportionately on theproducers and traders of agricultural commodities. The very low rates forbasic commodities limited the availability of appropriate services foragricultural products. In particular, grain shippers from Mindanao haddifficulty in obtaining sufficient cargo space because the rates were too low5
to make the commodities attractive to operators. In turn, the unavailabilityof sufficient liner services, inhibited the growth of inter-island trade andagricultural diversification; and resulted to high storage costs, commodityvalue losses resulting from deterioration and high charges for the alternativeand limited services of trampers and air transport.
On the other hand, since the passage rates were not permitted to increasewith the general inflation rate, they failed to keep pace with the increasingcost of providing passenger services. The practice in general is for cargoservices to subsidize passenger services. This made profitability in passengerservice difficult to achieve and resulted to both the tendency to overloadand provide very low service standards, which in turn, resulted in some ofthe major maritime disasters in the country’s history. It also hindered theintroduction of liner services on new routes as it raised the minimum levelof traffic required to make the service profitable.
Overall, the past regulatory system protected inefficient industryoperation.
5 The rates are lower than those imposed by tramp operators for hauling grains.
20
V
�
Liberalization, Deregulation and OtherGovernment Policies
The problems arising from the regulations of the industry and the majormaritime disasters and accidents that claimed thousands of lives towardsthe end of the 1980s prompted the government to finally introduce policyreforms in the industry (PTF 1989). The reforms came through the deregu-lation of the passage and freight rates and the liberalization of routes. Asdiscussed below, the process of reform was implemented gradually start-ing 1989 and is still continuing at present.
The change in policy was meant to introduce and/or enhance the levelof competition in terms of the rates charged and the quality of servicerendered while at the same time to attract new shipping investments byleveling the playing field for existing and new operators.
Deregulation of liner ratesA summary of the reforms for liner rates is shown in Table 5. Changes inpolicies and regulations were first initiated in 1989 under MC No. 46 as aresult of the recommendations of the Presidential Task Force on the Inter-island Shipping Industry. Early reforms included the (i) abolition of thecharging of ad valorem rates, although a 3/10 percent surcharge of thedeclared value of the commodity was imposed, except for Basic commodities;(ii) reclassification of Basic commodities to Class C (Basic); and (iii)deregulation of the first and second class passage rates.6 For the latter, aminimum of 50 percent of vessel capacity should be allocated to Third Classaccommodation. The deregulation allowed operators to determine the ratesthey will charge for their services.
Further reforms were made in 1990 under MC No. 57. The 3/10 per-cent surcharge was abolished; hence, all commodities were charged thecorresponding class rates. Freight rates for refrigerated cargoes, transitcargoes, and livestock were also deregulated. A most welcome reform was
6 First Class passenger rate was first deregulated in 1983.
Liberalization, Deregulation and O
ther Governm
ent Policies
21
Table 5. Government regulations on domestic shipping rates.
(i) charging of ad valoremrates abolished; (ii) ClassBasic reclassified asClass C (Basic); (iii) 50%of passenger capacityallocated for third classaccommodation.
(i) Rates for refrigerated,transit and livestockderegulated; (ii) Fork tariffsystem used fordetermining regulated rates.
(i) Increase in the fork rateby 12% and 8% forpassage and freight rates,respectively.
(i) 6% rollback on freightrates.
(i) automatic fueladjustment whenever fuelprices increase/decreaseby at least 10%; (ii)increase in the upper/lower limit of the fork tarifffrom +/-5% to +10%/-15%effective Jan. 1993
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
regulated
deregulated
deregulated
deregulated
deregulated
deregulated
deregulated(since 1983)
deregulated
deregulated
deregulated
deregulated
Implementing guidelineson the rate increase andchanges in level andstructure
Implementing guidelines onthe rate increase andchanges in level andstructure
Implementing guidelines onrate increase
Implementing guidelines onthe rollback of interislandlines rates
Implementing guidelines onthe automatic fuel adjustmentmechanism and the+10%/-15% limit on the forktariff system
MC 46, May1989
MC 57, May1990
MC 59, April1991
MC 66, May1992
MC 67, May1992
EO/MC& year Title of EO/MC
Passage Rates Freight/Cargo Rates RemarksFirst Class Second class Third class Class A Class B Class C Basic/Class
C (Basic)
22
Philippine D
omestic Shipping T
ransport IndustryTable 5. Continued
(i) Class C (Basic) to bereclassified into Class Cin 1993.
(i) DOT-accreditedvessels exempted fromallocating 50% of theirpassenger capacity to 3rdclass passenger; (ii)freight rates of fruits andvegetables shipped inventilated containersderegulated.
(i) implementation ofderegulated rates followDOSCON process; (ii)passage & freight rates formonopolized/cartelizedroutes regulated; (iii) forktariff system still appliesfor regulated rates
(i) DOSCON processabolished.
regulated
abolished;reclassifiedas Class C
regulated
regulated
deregulated,except non-containerized
basiccommodities
deregulated,except non-containerized
basiccommodities
deregulated
deregulated
deregulated
deregulated
deregulated
deregulated
deregulated
deregulated
regulated
regulated
regulated
regulated
deregulatedderegulatedderegulatedderegulated
deregulatedderegulatedderegulatedderegulated
Implementing guidelines onthe DOTC Dept Order No. 92-587 defining the policyframework on the regulationof transport services
Policy guidelines in theregulation of domestictransport services
Deregulating domesticshipping rates (EO 213);Rules and regulations toimplement the provisions ofEO 213 (MC 117)
Revised rules andregulations implementingderegulation of shipping rates
MC 71,October1992
MC 80,November1993
EO 213,Nov 1994;MC 117, Oct1996
MC 153,Dec 1999
Note: The table is a chronological presentation of the EO and MC. The remarks column only include the salient features not included in the preceding circulars, unlessstated as abolished.
EO/MC& year Title of EO/MC
Passage Rates Freight/Cargo Rates RemarksFirst Class Second class Third class Class A Class B Class C Basic/Class
C (Basic)
23
the introduction of the fork tariff system for the determination of freightand passage rates.7 Under the system, rates are allowed to fluctuate be-tween upper and lower limits from a given reference or indicative rate,thereby providing some flexibility in the determination of rates. For cargoes,the system provides a mechanism for the shippers and shipping operators tonegotiate for the rates within the band set by the government. The first forktariff system had a lower and upper limit of –5 percent and +5 percent of thereference rate, respectively. This means that a domestic shipping operatormay increase its freight rate of a given commodity or shipment up to a maxi-mum of 5 percent and may deduct a maximum of 5 percent on the base rate.
In 1991 (MC No. 59), the reference rate for the fork tariff system wasincreased by 12 percent for the passage rate and by 8 percent for the freightrate. In 1992 (MC No. 66), a 6 percent rollback on freight rates was adopted.Also, the lower and upper limit of the fork tariff system was increased from+/-5 percent to +10/-15 percent. A mechanism for automatic fuel adjustmentwhenever prices of fuel increase or decrease by at least 10 percent was alsoinstituted. Under the mechanism, however, shipping operators cannot uni-laterally adjust their rates. Instead, MARINA will automatically adjustthe rates with the issuance of the appropriate Order increasing or decreas-ing the rates within five working days after the increase/decrease of fuelprice.
The early reforms, however, were unable to correct the problems iden-tified earlier. For one, the flexibility provided by the fork tariff system wasvery limited as the rates could not vary to the extent that operating costsvary with respect to routes, ship technology especially with the introductionof container service and roll-on roll-off (RORO) service, quality of packag-ing, and changes in cargo handling methods. Second, the compulsory re-quirement to allocate 50 percent of passenger capacity to accommodate thirdclass passengers made pure passenger vessel operation less viable. Third,the reclassification of Basic commodities to Class C (Basic) failed to correctthe insufficiency of appropriate liner service for these commodities. Finally,the deregulation of the second and first class passenger service did not causemovement of passengers from third to second class (Nathan and Associates1991).
Hence, further deregulation was made towards the end of 1992 (MCNo. 67), this time involving the freight rates for Class A and Class B cargoes.
7 Only members of the Conference of Interisland Shipowners and Operators and any other operators who have filedapplications for rate increase by paying the corresponding fee and issued the corresponding Order are authorized touse the fork tariff system.
Liberalization, Deregulation and Other Government Policies
Philippine Domestic Shipping Transport Industry
24
The operators were however required to file their rates for Class A andClass B and any changes thereafter, with the MARINA. In 1993 (MC No. 80),Class C (Basic) was abolished and the commodities classified therein werereclassified as Class C. Fruits and vegetables in ventilated containers werealso deregulated. For passage rates, vessels accredited by the Departmentof Tourism as serving tourist areas were exempted from the requirement ofallocating 50 percent of their total passenger capacity to Third Class passen-gers; and accordingly, their rates were deregulated. However, if the vesselonly has First Class and Second Class passenger accommodation or wherethe Third Class passenger accommodation is less than 50 percent of the pas-senger capacity, the Second Class passage rate was regulated.
Further deregulation of freight rates was made in 1994 throughExecutive Order No. (EO) 213, with implementing guidelines under MC No.117 issued in 1996. All freight rates were deregulated, except fornoncontainerized basic commodities. However, for monopolized andcartelized routes, passage and freight rates continue to be regulated. Thefork tariff system is still applied to all regulated rates, the upward adjustmentof which continues to follow the revenue deficiency method; but this time,the rate increase is computed on a per company basis.
The implementation of deregulated freight rates, however, was anothermatter as operators were not allowed to determine on their own the ratesthey will charge for their services. Instead, the Domestic Shipping Consulta-tive Councils (DOSCONs), composed of shippers/consumers, operators andrepresentatives from the government, was instituted to provide a forum forthe process of consultation and negotiations for the implementation of thederegulated rates or any upward adjustments of the rates. Hence, the de-regulation as provided for in EO 214 only modified the process of fixingcargo rates that was previously exercised by the government through quasi-judicial procedures.
The DOSCON process, however, was abolished in late 1999 when theimplementing guidelines of EO 213 were revised under MC No. 153. Underthe revised guidelines, all an operator needs to do is to file a notice of adop-tion of deregulated rates with the MARINA, and when qualified, MARINAwill issue an Order within 30 days upon receipt of the notice. The deregu-lated freight and passage rates should remain in force for at least three monthsbefore any upward adjustment is allowed.
Upward adjustments of deregulated rates can take effect 15 days afterthe publication of the notice for increase filed with the MARINA in one dailynewspaper of national circulation and in one daily newspaper of regionalcirculation in the port/s affected by the rate adjustment.
For regulated rates, upward adjustment is still based on the revenuedeficiency method. Under the new policy environment, the method may no
longer be appropriate as the financial statements of shipping companies in-clude their deregulated operations.
In general, the deregulation of the liner shipping rates has been a slowprocess. It took the government more than 10 years to gradually deregulatethe liner rates. Yet, it was only in the year 2000 that government interventionin rate setting was lessened. With deregulation, the shipping companies cannow consider the traffic imbalances and cargo mixes in setting the rates forthe routes they serve. While there are still areas that remain regulated, thesecan be overcome and can be strategic areas for modernizing the industry.For example, shipping companies can upgrade their vessels and facilities andbe accredited with DOT and be exempted from allocating 50 percent of theirpassenger capacity to third class and enjoy the deregulated rates. Also, theexemption of noncontainerized basic commodities from deregulation shouldencourage the use of other shipping technology in transporting these com-modities, like RORO vessels.
Much is still desired, however. The rate for Third Class passenger is yetto be deregulated.
Route liberalizationLiberalization of the routes was first introduced in 1992. Two general prin-ciples are observed for the issuance of a CPC. First, the interest of the publicis paramount. That is, the interest of the public shall prevail over the grand-father rules of the prereform namely, prior applicant, prior operator andprotection of investment. Second, the presumption of public need for a ser-vice is deemed in favor of the applicant for a CPC while the burden of prov-ing that there is no need for a proposed service shall be with oppositor/swho is/are the current authorized operator/s.
Given these principles, routes were opened to entry to at least two op-erators (MC No. 71 and MC NO. 80 in 1992). Monopolized routes were openedfor entry to additional operators. Operators in developmental routes, on theother hand, were accorded protection for their investment for a maximumperiod of five years, after which, the route is open to entry to at least oneadditional operator. This was a big contrast to the prereform period regula-tion where an operator in a developmental route is accorded protection ofhis investment for an indefinite period, that is, until he has recovered hisinvestment. This change in rule would definitely encourage the operator toincrease his efficiency for him to be able to recover his investments beforecompetition from additional operators sets in. Entry of newly-acquired ves-sels in routes already served by existing franchised operators, including de-velopmental routes, is also deregulated provided that the entry will intro-duce innovative, technologically and cost-effective shipping services, amongothers.
26
Liberalization, Deregulation and Other Government Policies
Operators are allowed to withdraw or suspend their operations afternotifying MARINA 15 days prior to such and after informing the public. Anoperator, however, forfeits his CPC if he abandons, withdraws, or suspendshis operation for four months without notifying MARINA. Increase in capac-ity is also allowed through replacement with a bigger vessel, introduction ofadditional vessels and/or increase in frequency of service of existing vessels.An operator can also change his routing pattern through the omission ofports, addition of one or more ports, or the introduction of an entirely newroute provided however that the change does not pose any conflict with theschedule and frequency of service of existing operators and that no route isleft unserved by the rerouting.
The initial liberalization efforts were further strengthened with the is-suance of EO 185 in 1994 and its corresponding implementing rules and regu-lations under MC 106 in 1995. In particular, all routes that have been servicedby any operator for an aggregate period of at least five years shall be openfor entry to additional operators. Likewise, any operator who pioneers inthe provision of a certain technological level of shipping service in a develop-mental route is allowed to charge market-accepted freight and passage ratesdifferent from the fork rates. The adoption of such rates after five years,however, is dependent on the evaluation of MARINA. Also, when capacity isincreased through the replacement of a vessel, the CPC of the vessel to bereplaced is revoked. The revocation of CPC will ensure that the vessel re-placed will not be used anywhere else and hence, will not result in increase intonnage in the routes. Similarly, when capacity is increased through the in-troduction of additional vessel that is chartered from a franchised operator,the original franchise of the vessel is revoked. This policy was again a bigcontrast to the prereform regulation where the CPCs of vessels replaced werenot revoked.
The implementing guidelines of EO 185 were revised under MC No.161 in 2000, providing further dimension to the liberalization efforts. In par-ticular, the conditions or criteria under which possible protection could beaccorded to operators were specified. These include conditions for the exist-ence of ruinous competition and protection of investment of pioneering op-erators. Only under the conditions specified should entry of additional op-erators to a route be restricted. The conditions set therefore added greatertransparency to the rules of the game.
Liberalization, Deregulation and Other Government Policies
27
Other government policiesCabotage LawForeign shipping lines are not allowed to ply the country’s interisland routes.
Domestic Shipping Modernization ProgramTo complement the liberalization and deregulation efforts, the governmentimplemented the Domestic Shipping Modernization Program (DSMP) fundedby a loan package from the Overseas Economic Cooperation Fund (OECF) ofJapan and administered by the Development Bank of the Philippines (DBP).The program has two phases: Phase I (1995-2000) with a loan package of 14.8billion yen or roughly P3.91 billion for the modernization of interisland ves-sels; and Phase II (1999-2005) with a loan package of 19.5 billion yen or P6.7billion for the development of port facilities in rural areas.
Phase I was used to finance the replacement of vessels (new buildingsand/or second hand), rehabilitation and/or upgrading (bringing to class)and modernization of interisland fleet; acquisition, rehabilitation, and mod-ernization of shipyards and port cargo handling equipment; and workingcapital. As of June 2001, almost 84 percent of the package has been loanedout, most of which went to passenger-cargo vessels and tankers (Figure 2).
Figure 2. Loans released by sector, DSMP I,as of June 2001
Source: IRR, Development Bank of the Philippines (DBP)
DSMP I distribution per sector
tankers
gen. cargo vessels
pass/ cargo
pass/ ferries
barging/ lighterage
shipyards
terminal facilities
port developments
(in Pmillion)
872.52
474.65
868.20
489.00
231.02
8.30
95.50
240.00
3,279.19
Philippine Domestic Shipping Transport Industry
28
This explains the increase in the capacity (GRT) of passenger vessels and thedecline in their average age as discussed earlier in Section 2 of the paper.
For Phase II, as of June 2001, a total of P5.8 billion from the loan packagehas been released and distributed across the various sectors as shown inFigure 3.
DSMP II distribution per sector
tankers
gen. cargo vessels
pass/ cargo
pass/ ferries
barging/ lighterage
pilotage
shipyards
terminal facilities
port developments
maritime education
(in Pmillion)
505.50
29.38
672.50
118.00
174.00
47.00
322.00
10.50
3,388.70
502.10
5,769.68Note: Maritime education not included in Phase ISource: IRR, DBP
Figure 3. Loans released by sector, DSMP II,as of June 2001
29
VI
�
Market Structure and Competition
The Herfindahl-Hirschman Index (HHI) is used as an indicator of marketstructure. The index is measured as the sum of the squares of the marketshares. It is compared with the ratio 1/n where n is the number of operatorsin the industry. The higher the index relative to 1/n, the less competitive theindustry is. The inverse of the index gives the number of equal sized com-petitors that would provide a degree of competition equivalent to that actu-ally observed in the market share data. Hence, it is used as a measure of thenumber of effective competitors.
The aggregate indicator of market structure for the industry is basedon the primary and secondary routes only, i.e., tertiary routes were excludedin the computation. Since the tertiary routes involve short distance traveland hence more frequencies of trips, the total passengers and cargoes plyingthese routes would be larger in number compared to the primary and sec-ondary routes. And since HHI is based on market shares, including them inthe computation would distort the picture.
However, the aggregate indicator of market structure may give verylittle insight on the extent of market power in the different routes becausethe interisland fleet is distributed across so many different routes. It is pos-sible that a small operator may capture a large market share in a particularroute by concentrating its fleet in that route while a large operator may notcapture a significant market share if it spreads its fleet across several routes.Thus, it is important to also examine the market structure by routes. Theroutes are classified based on the value of 1/HHI as shown in Table 6.
The study used secondary data and interviews of shipping operators toanalyze market structure and competition in the shipping industry. Second-ary data on passenger and cargo traffic by route and shipping company weregathered using the 1998 annual traffic reports of shipping companies submit-ted to the MARINA. This is the latest data that are available and complete.Much as the study would like to include early years to represent the pre-reform period so that an analysis on whether or not the policy reforms have
Philippine Domestic Shipping Transport Industry
made an impact on the market structure could be made, the annual reports ofshipping companies were not complete.8 Hence, to get a sense of the impactof the reforms in the absence of data, interviews were made with four ship-ping lines based in Metro Manila, six shipping lines based in Cebu, threeshipping associations, and the Distributors Management Association of thePhilippines (DMAP).
Data on passenger traffic were used in measuring the market structurefor the passenger service. For cargo service, since different units of measure-ment were used for cargo traffic, aggregation was impossible.9 Thus, data oncargo revenue was used.
Furthermore, since the latest secondary data available is 1998, the analysisof the study on market structure does not reflect the possible effects of MC153 and MC 161, which provided further dimension to the government’sefforts on rate liberalization and route deregulation, respectively.
30
8 The 1993 data were initially processed but the annual reports of some of the shipping companies were missing.MARINA has data on annual total passenger and cargo traffic but not by route and shipping company which is what isneeded in analyzing market structure and competition.9 Units of measurements include kg, metric tons, and pieces.
Market structurePassenger ServiceThe HHI shows that the domestic shipping industry is highly concentrated(Table 7). The five largest operators accounted for as much as 90 percent of
Table 6. Classification of routes
Classification Indicator(1) routes with only one (1) operator
monopoly
(2) routes with at least two (2)operators
i. only one (1)effective competitor
ii. substantial competition
iii. Mild competition
HHI 1
1HHI
1< < 1.4
< # of peratorsHHI
1
HHI1
< # of perators1.4 <
Liberalization, Deregulation and Other Government Policies
31
Table 7. Indicators of market structure, passenger service, 1998
Indicators
Share of top five firmsShare of top three firms
Herfindahl index (HHI)Number of operators (n)1/n1/HHI
90.2672.94
0.21037.00 0.027 4.76
The five largest players in the passenger service (from largest to small-est), in descending order, are Negros Navigation Company, WG&A, SulpicioLines, Philippine Fast Ferry Corporation and Cebu Ferries Corporation. Onesignificant characteristic of these operators is that, three of them are newcompetitors, being established only during the reform period. WG&A is aproduct of the merger of three shipping giants (William Lines Inc., Carlos A.Gothong Lines, Inc. and Aboitiz Shipping Corp.) in 1996. Philippine Fast Ferry(PFFC) is also a product of the merger in 1998 of the Cebu-based UniversalAboitiz, Inc. and Bacolod-based Sea Angels Ferry Corporation, a subsidiaryof Negros Navigation Company. Cebu Ferries Corporation (CFC) was estab-lished in 1996 as a subsidiary of WG&A. Both PFFC and CFC had been piv-otal to the birth of the fast ferry industry in the country. The other twoplayers (Negros Navigation and Sulpicio Lines) are old time players, beingestablished long before the reforms were introduced. Analysis of the different routes shows that the top five players oper-ate most of the primary routes (Appendix Table 1). However, there is notone route where they operate together. On the other hand, the top threecompanies operate together in eight routes, all originating from Manila(Manila-Cagayan de Oro, Manila-Cebu, Manila-Davao, Manila-Dumaguete,Manila-General Santos, Manila-Iligan, Manila-Iloilo and Manila-Tagbilaran).
About 50 percent of the primary routes have at least two operators andthe remaining 50 percent only have one operator (Table 8 and AppendixTable 1). Nonetheless, the presence of at least two operators in a route doesnot guarantee that competition exists. Of the 26 primary routes with at leasttwo operators, substantial competition exist only in seven routes or less than
the total passengers. The inverse of HHI shows that out of the 37 opera-tors plying the primary and secondary routes, less than five are effectivelycompeting.
Philippine Domestic Shipping Transport Industry
32
14 percent of the total number of primary routes, while five routes wereeffectively monopolized, as there was only one effective competitor. The restof the primary routes (27 percent) can be described as having only mild com-petition. A very good example of this is the Cebu-Bohol route where therewere nine operators plying the said route but less than three were effectivelycompeting for the passenger market. Another is the Cebu-Dumaguete routewhere there were six operators but only three were effectively competing.
For the secondary passenger routes, almost 59 percent was monopo-lized; 13 percent was characterized by substantial competition; 13 percenthad only mild competition; and 15 percent was effectively dominated byonly one competitor (Table 8 and Appendix Table 2).
On the other hand, monopoly was present in nearly 78 percent of thetertiary routes (Table 8 and Appendix Table 3). Operation in about 5 percentof the routes were effectively dominated by one operator. Substantial com-petition was found in only 8 percent of the routes.
Cargo ServiceFigures on freight revenue also show that the industry is highly concentrated.The five largest operators together carried 91 percent of the total revenue(Table 9). Out of the 66 operators, less than five are effectively competing.
The five largest players in the cargo service, in their order, includeWG&A, Sulpicio Lines, Lorenzo Shipping Corporation, Solid Shipping Cor-poration and Negros Navigation. Lorenzo Shipping and Solid Shipping arepurely cargo services.
Table 8. State of competition, passenger service, 1998
Route ClassificationPrimary Secondary Tertiary
Number (%) Number (%) Number (%)
26
265714
52
50.0
50.0 9.613.526.9
27
19766
46
58.7
41.315.213.013.0
27
19766
46
58.7
41.315.213.013.0
Note: See Appendix Tables 1 to 3 for details.
Routes with only 1 operator
Routes with at least 2 operatorsRoutes with only 1 effective operatorRoutes with substantial competitionRoutes with mild competition
Total number of routes
33
Market Structure and Competition
Table 9. Indicators of market structure, cargo service, 1998
Analysis of the routes shows that there are only three routes (Manila-Cagayan,Manila-Dumaguete and Manila-General Santos) where the top five compa-nies operate together. Furthermore, close to two-thirds of the primary andsecondary cargo routes had at least two operators but less than 15 percentexperienced substantial competition (Table 10 and Appendix Tables 4 and 5).On the other hand, a greater majority (76 percent) of the tertiary routes werestill monopolized (Table 10 and Appendix Table 6).
Findings common to passenger and cargoThe dominance of the top five companies in both passenger and cargo ser-vices, was prevalent in the primary and secondary routes, regardless of theroutes’ state of competition (Table 11). In other words, they effectively con-trol the market in these routes. Regular monitoring of the routes then be-comes necessary to ensure that the top five players do not abuse their market
Share of top five firmsShare of top three firms
Herfindahl index (HHI)Number of operators (n)1/n1/HHI
91.12
70.920.21766.000.0154.61
Indicators
Table 10. State of competition cargo service, 1998
Route ClassificationPrimary Secondary Tertiary
Number (%) Number (%) Number (%)
25
4471027
69
36.2
63.810.114.539.1
16
309615
46
34.8
65.219.613.032.6
444
135393858
579
76.7
23.36.76.510.0
Note: See Appendix Tables 4 to 6 for details.
Routes with only 1 operator
Routes with at least 2 operatorsRoutes with only 1 effective operatorRoutes with substantial competitionRoutes with mild competition
Total number of routes
Philippine Domestic Shipping Transport Industry
power, more so given the fact that the percentage of routes with substantialcompetition is relatively small.
Substantial competition is expected in routes common to the top five ortop three players. It is surprising, however, that this is not the case. In fact,there was only mild competition in those routes. Only in the Manila-Dumaguete
34
Market Structure and Competition
35
passenger route, where the top three companies operated together, was theresubstantial competition.
Substantial competition is also expected in the major ports because thesupposed large passenger market and volume of cargoes will draw moreplayers into the routes. However, the analysis of the routes originating fromManila or Cebu, two of the countries major ports, shows otherwise. Most ofthe routes either have only one operator or are characterized by only mildcompetition (Table 12 and Table 13).
A further analysis of the individual routes shows that operators havetheir own niche markets. And this is true even for the five largest operators.A good example of this is Solid Shipping Lines that operates in only threecargo routes (Manila-Cagayan, Manila-Dumaguete and Manila-GeneralSantos). Also, the five largest players are not always the dominant player inthe routes where they operate. An example of this is the Dumaguete-Zamboanga cargo route that includes WG&A and Sulpicio Lines as operatorsbut which are not the dominant players.
Analysis of the routes with only one effective competitor or mild com-petition shows that the dominant player or players get the bulk of the marketwhile the rest have very small share. The market shares of the dominantplayer or players range from 83 percent to almost 100 percent for the routeswith only one effective competitor and from 59 percent to almost 100 percentfor those with mild competition (Table 14). An example is the Cebu-Ormocpassenger route where there were six operators but 84 percent of the passen-ger traffic went to only two players. Another is the Cebu-Bohol passengerroute with nine operators but only three operators captured 83 percent of themarket. It is possible that the dominant players offer lower rates or theyhave more vessels and larger capacities enabling them to capture a largesegment of the market and leaving the crumbs to the rest who probably haveonly small capacities. Pursuing this issue however is beyond the scope of thispaper since it requires an analysis of the cost structures of the individualoperators.
The high concentration in the tertiary routes for both passenger andcargo services may not really pose a problem since these are usually consid-ered “thin routes” where traffic is insufficient to attract more than one opera-tor. That is, only one operator is required to make the operation profitable andefficient. As discussed in Section 2 of the paper, there is less economic activityand population in the tertiary routes, implying smaller passenger and cargotraffic compared to the primary and secondary routes. What is critical, how-ever, is the close monitoring by MARINA of the services of operators plyingthe said routes to make sure that these operators do not abuse their marketpower to the detriment of the welfare of passengers and shippers.
36
Philippine Domestic Shipping Transport Industry
Table 12. State of competition, routes originating from Manila and Cebu,passenger services, 1998
Routes with only1 operator
Routes with substantialcompetition
Routes with only 1effective competitor
Routes with mildcompetition
MANILAPrimary routes
Mla-BatangasMla-DadiangasMla-San CarlosMla-Zambales
Secondary routesMla-CoronMla-LeyteMla-MindoroMla-Tacloban
Tertiary routesMla-ButuanMla-CalubianMla-CorregidorMla-DumaguitMla-El Nido- LiminangcongMla-Zambales
CEBUPrimary routes
Cebu-DadiangasCebu-DavaoCebu-EstanciaCebu-MasbateCebu-NasipitCebu-Zamboanga
Secondary routesCebu-BacolodCebu-CalbayogCebu-CatanduanesCebu-TaclobanCebu-Talibon
Tertiary routesCebu-CamotesCebu-DawahonCebu-HiligaynonCebu-JetafeCebu-Lapu-lapuCebu-LarenaCebu-LaziCebu-Sta Fe
Mla-DipologMla-DumagueteMla-EstanciaMla-Masbate
Mla-RoxasMla-Surigao
Cebu-Tubigon
Cebu-ButuanCebu-Palompon
Cebu-Naval
Mla-Gen SantosMla-Nasipit
Mla-BacolodMla-CotabatoMla-Ormoc
Cebu-Jagna
Cebu-DipologCebu-OzamisCebu-Surigao
Cebu-CamiguinCebu-Iligan
Mla-Cagayan de OroMla-CebuMla-DavaoMla-IliganMla-IloiloMla-Palawan/Puerto PrincesaMla-TagbilaranMla-Zamboanga
Mla-OzamisMla-Palompon
Cebu-BoholCebu-DumagueteCebu-Gen SantosCebu-IloiloCebu-Palawan/Puerto PrincesaCebu-Tagbilaran
Cebu-DapitanCebu-LeyteCebu-Ormoc
Source: Appendix Tables 1 to 3.
37
Market Structure and Competition
Table 13. State of competition, routes originating from Manila and Cebu,cargo services, 1998
MANILAPrimary routes
Mla-BatangasMla-Cebu-IliganMla-Cebu-Iligan-Dumaguete
Mla-DadiangasMla-Cebu-Gen SantosMla-NasipitMla-Puerto Princesa
Secondary routesMla-CoronMla-BaybayMla-Cebu-BacolodMla-MaasinMla-PalomponMla-Tilik
Tertiary routesMla-AklanMla-BaisMla-CalubianMla-Danao EscalanteMla-Iligan-MargosatubigMla-Illigan-SionMla-LiminangcongMla-Palawan-LucenaMla-PollocMla-PulupandanMla-Toledo
CEBUPrimary routes
Cebu-Cotabato-Dumaguete
Cebu-Cotabato-Gen Santos
Cebu-DadiangasCebu-Dumaguete-Gen Santos
Cebu-Iligan-Cagayan de Oro
Cebu-Iligan-IloiloCebu-Iloilo-PalawanCebu-NasipitCebu-Tubigon
Mla-DipologMla-EstanciaMla-MasbateMla-San Carlos
Mla-ButuanMla-CotabatoMla-RoxasMla-Surigao
Mla-Jolo
Cebu-JagnaCebu-Zamboanga-Gen Santos
Mla-Catbalogan
Cebu-MasbateCebu-Puerto PrincesaCebu-Tagbilaran
Mla-BacolodMla-CagayanMla-CebuMla-DavaoMla-DumagueteMla-Gen SantosMla-IliganMla-IloiloMla-PalawanMla-TagbilaranMla-Zamboanga
Mla-OrmocMla-OzamisMla-Tacloban
Mla-Escalante
Cebu-BoholCebu-CagayanCebu-DavaoCebu-DumagueteCebu-Gen SantosCebu-IloiloCebu-PalawanCebu-Zamboanga
Routes with substantialcompetition
Routes with only 1effective competitor
Routes with only 1operator
Routes with mildcompetition
Philippine Domestic Shipping Transport Industry
38
Table 13. Continued
Intermodal competitionThe market power in the passenger service is now constrained by competi-tion from other modes of transportation. In particular, the deregulation ofthe air transport industry has captured part of the First and Second Class
(CEBU con’t.)Secondary routes
Tertiary routesCebu-BagoCebu-BantayanCebu-BantilanCebu-BataanCebu-BauanCebu-Bilangbilangan East & WestCebu-BoronganCebu-BulanCebu-Cagayan de OrocilloCebu-Calbayog-GuiwanCebu-CamiguinCebu-CatainganCebu-CebuCebu-Cotabato-ZamboangaCebu-GuiuanCebu-Iloilo-LegaspiCebu-Iloilo-PasacaoCebu-JetafeCebu-KiwalanCebu-LarenaCebu-LaziCebu-LiloyCebu-MagallanesCebu-Mindoro-TagbilaranCebu-NabilidCebu-OroquiettaCebu-PollocCebu-Pulupandan-OzamisCebu-San CarlosCebu-San FernandoCebu-San JoseCebu-Sta Fe
Cebu-Talibon
Cebu-BaisCebu-Batangas
Cebu-CalbayogCeub-DapitanCebu-OrmocCebu-OzamisCebu-PalomponCebu-Tacloban
Cebu-CatbaloganCebu-MaasinCebu-Tandag
Cebu-BacolodCebu-ButuanCebu-DipologCebu-Surigao
Cebu-CamotesCebu-CotabatoCebu-IliganCebu-LegaspiCebu-LeyteCebu-Naval
Source: Appendix Tables 4 to 6.
Routes with substantialcompetition
Routes with only 1effective competitor
Routes with only 1operator
Routes with mildcompetition
39
Market Structure and Competition
Table 14. Range of market shares of dominant players in routeswith only 1 effective competitor and routes with mild competition (%)
passengers. This is particularly true during off peak season when airlines areable to offer budget fares that come very close to the Third Class passengerrates of shipping lines. The fast travel by air and the comfort that it providesmore than compensate for the price difference thereby, enabling airlines tocapture a sizeable chunk of the passenger market.
In addition, the budget airfares opened an alternative mode of travel toa market that formerly cannot afford to travel by air. The best examples ofthese are housemaids from the southern part of the country who are work-ing in Metro Manila or students from the south studying in universities inMetro Manila. On the other hand, the introduction of fast ferries providesgood competition to airlines flying the secondary and tertiary routes.
Also, the development of roads and other infrastructures (like bridges)in the southern part of the country opened an alternative to shipping trans-port. An example of this is the construction of the Marcelo Fernan Bridgeconnecting Cebu City and Lapu-lapu City that has reduced the number ofpassengers plying the Lapu-lapu-Cebu ferry route because some passengersnow prefer to travel by land considering the reduction in traffic caused bythe construction of the bridge. Also, land transport from Manila to the Visayasand even to Davao has become increasingly popular to travelers because ofthe cheaper bus fare, providing competition to the Manila-Tacloban, Manila-Catbalogan or Manila-Davao shipping routes.
Nonetheless, market power in the cargo service still lies in the hands ofthe shipping industry.
Routes with only one (1) effectivecompetitor
Routes with mild competition
Passenger84.1 - 98.683.2 - 99.989.0 - 99.9
Cargo84.0 - 99.087.2 - 98.987.2 - 98.9
78.3 - 98.570.0 - 94.471.3 - 93.9
59.0 - 99.867.3 - 99.867.3 - 99.8
Source: Appendix Tables 1 to 6
CompetitionBecause of the absence of data, the results of the interviews with shippinglines and the executive director of the DMAP will be used in analyzing theeffects of the policy reforms on competition. The results of the interviewreveal that the most significant impact of the reforms is the increase in com-petition in the industry. Given this information and the indicators of marketstructure in 1998 discussed in the preceding section, it can be deduced thatthe industry was more concentrated prior to 1998. The merger of the ship-ping giants was initially perceived to be a threat by the other major player.But since shipping companies operate by maintaining niche markets, the mergerdid not make the industry more concentrated nor did it increase the marketpower of the merged companies.10 The merger in fact promoted competition.The merger was the response of the companies involved in increasing theirefficiency as a result of competition.
However, the increase in competition is felt only in the primary andsecondary routes. This confirms the finding in the preceding section thatmajority of the tertiary routes are still run by single operators. The increasein competition in the primary and secondary routes came from additionaloperators in the routes. The reforms provided new operators the opportu-nity to gain entry in routes where entry was previously restricted by thegrandfather rules.
The increase in the number of competitors in the routes is beneficial topassengers and shippers because it gave them several choices of shippinglines for the service they require. For shippers, competition did not onlyincrease choices for their cargoes but it also increased their linkage to theirports of call. The immediate results of competition are the improvement inthe quality of service.
Quality of serviceBecause competition increased, shipping operators were forced to improveon the quality of their service. Customer service and satisfaction drive upcompetition thereby improving efficiency. Improvement in the quality of ser-vice also meant the introduction of new facilities and amenities on board,and improvement or upgrading of facilities not only in passenger accommo-dation but also in ticketing and booking facilities.11 Upgrading of facilitiesencouraged certification from ISM and ISO.
Philippine Domestic Shipping Transport Industry
10 The argument is based on the interview with shipping lines. The executive director of the DMAP thinks otherwise.
40
Market Structure and Competition
Improvement and upgrading of facilities resulted to the modernizationof the domestic fleet. Bigger and better vessels were acquired. As shownearlier in Table 3, there was an increase in industry fleet particularly forgeneral cargo and passenger cargo starting 1993. Also, the average age ofvessels for passenger cargo substantially declined from 21 years in 1990 toless than 10 years in 1999, indicating newer vessels plying the routes (Table 4).
It is also said, however, that the modernization of the domestic fleetresulted in the overtonnaging of the primary routes during the early stage ofthe reform process. Such situation, however, is expected as shipping compa-nies adjust their operations to the new environment. Likewise, the increasein capacity during the first half of the 1990s was in anticipation of the ex-pected increase in passenger and cargo traffic in the future. That is, sincevessel acquisition takes time, vessels deployed today are meant not only toaddress present demand but also future capacity. However, prolongedovertonnaging could endanger competition. There is a general observation,however, that most shipping companies are now reducing their fleet andconsolidating their operations. The reduction in fleet was also partly due tothe fact that the increase in demand for shipping services expected earlierdid not materialize.
Improvement in facilities is best exemplified by the advent of fastcraftvessels. Dubbed as “a home right at sea,” these fast speed crafts extend thebest of services and the best of convenience enabling passengers to crisscrossislands and regions in a short period of travel. The fast craft vessels openeda new marketing strategy in the transportation business. Operators of fastcraft vessels have established links with airlines and large shipping lines withoperations originating from Manila, operating in a hub-and-spoke pattern.That is, the airlines and large shipping lines bring passengers through theprimary routes while the fast craft vessels will bring these same passengersto their destinations in the secondary routes. Visayas is the hub of the country’sfastcrafts operation. The strategy has propelled commerce and trade andaccelerated tourism and tourism-related activities in the southern part of thecountry.
However, the profitability of the fastcraft industry is observed to bedifficult to sustain. It is said that fast crafts are not yet appropriate for thecountry, considering the country’s level of development. Fastcraft vesselsgenerally cater to the A-B crowd or those belonging to high-income group ofthe society. Domestic sea passengers in the country are mostly the C-D crowd
11 One shipping operator in Cebu has a ticketing and booking office that looks better than the ticketing offices of domesticairlines.
41
42
Philippine Domestic Shipping Transport Industry
or low-income group of the society. Likewise, fast crafts are good only forshort distance travel; but then again, most passengers in these routes are theC-D crowd and a few businessmen who travel to places not within the reachof air transport. It is observed that some of the fast-craft vessels have beenpulled out from some of the routes.
For cargo services, improvement in quality means the availability ofsufficient and appropriate services. The latter was achieved through improve-ment in technology in cargo services, like the use of RORO vessels and con-tainerization.12 However, the use of RORO vessels is more appropriate forthe country considering its archipelagic setting. Large benefits can be de-rived from RORO operations by avoiding handling at two ports as well astime losses and value losses derived from the time spent at ports. On theother hand, containerization is more appropriate for long voyages like ininternational shipping.
Services in the tertiary routes, on the other hand, remained unimprovedbecause of the lack, if not absence, of competition. Old vessels and motorizedbancas are still used, endangering the lives of passengers.
Passage and freight ratesAvailable data on the actual rates charged by two of the major players in theindustry show that rates for both passage and cargo have increased in realterms (Tables 15 to 18). What is striking however is the large increase in ratesafter 1999 compared to the years before it. This is true regardless of the classof commodity or passenger, except for the first class passenger of WG&A.
As discussed earlier in the paper, the DOSCON process was abolishedin late 1999 allowing companies full freedom to determine their deregulatedrates. However, the three automatic fuel rate adjustments in 2000 totaling19.15 percent contributed to the large increase for the period 1999-2000. Onthe other hand, the general rate increase of 20 percent adopted by the ship-ping association in November 2000 contributed to the increase in 2000-2001.The uniform increase for all shipping operators is alarming as it has a sem-blance of a cartel-like arrangement.
Nonetheless, the deregulation has corrected what otherwise were verylow cargo rates arising from the past regulatory system. This could be seenfrom the large increase (53.3%) in cargo rate of the Manila-Tacloban route in1999-2000 (Table 14). Based on the interview, the route is a classic example of
12 Vessels designed to use the RORO method of cargo handling are designed with a ramp at the stern. Over the ramp,connected to a pier, loaded vans pass aboard, stowing themselves under their own power. On the other hand,containerization is a method of carrying cargo in vessel container vans stowed on deck or in the cargo hold of a ship.
43
Market Structure and Competition
RouteClass ACebu/ DavaoIloilo/ BacolodIloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ SurigaoManila/ TaclobanClass BCebu/ DavaoIloilo/ BacolodIloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ SurigaoManila/ TaclobanClass CCebu/ DavaoIloilo/ BacolodIloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ SurigaoManila/ Tacloban
-2.85
1.71
-2.85-4.801.71
-2.85-2.91-2.82-2.85
-2.85
1.12
-2.85-4.802.89
-2.85-2.92-2.85-2.85
-2.85
1.19
-2.85-4.801.71
-2.85-2.92-2.85-2.85
1.92
8.14
1.923.898.141.921.991.891.92
1.92
8.69
1.923.896.901.922.001.921.91
1.93
8.70
1.923.908.141.936.471.931.93
-4.13
-9.58
-4.13-4.02-9.58-4.13-4.13-4.13-4.13
-4.13
-9.58
-4.13-4.02-9.58-4.13-4.13-4.13-4.12
-4.13
-9.58
-4.13-4.02-9.58-4.13-0.57-4.13-4.13
9.22
0.27
-5.030.270.27
-5.030.270.27
-17.83
0.27
0.27
-5.030.270.27
-5.030.260.270.27
0.27
1.41
-5.030.27
-1.82-5.03-0.320.270.27
5.39
3.973.97
-1.0514.8023.228.30
18.403.97
53.31
14.79
3.963.96
-1.0514.7922.168.30
14.793.97
25.61
14.17
2.81-3.39-1.0514.8025.848.306.673.97
25.63
19.38
31.8231.8129.7019.3811.2218.5115.7431.819.09
19.38
31.8131.8129.7019.3812.1718.5119.3831.809.09
20.04
31.8231.81
-30.5619.3811.2218.5019.3831.829.09
Source: Quarterly Report on Actual Rates Charged of Shipping Companies submitted to theMARINA.
Table 15. Annual increase in cargo rates, Sulpicio Lines (%, 1995 prices)
1995-96 1996-97 1997-98 1998-99 1999-00 2000-01
44
Philippine Domestic Shipping Transport Industry
Table 16. Annual increase in cargo votes, WG&A (%, 1995 prices)
1999-00
-6.25-6.25-1.7921.134.92
21.1316.7613.8421.13-6.2521.13
-6.25-6.25-1.7921.124.75
21.1221.1213.8421.08-6.2521.1221.12
-6.25-6.25-1.6421.134.74
21.1321.1413.8421.13-6.2521.1421.14
2000-01
0.000
0.00022.60227.86922.60719.70717.64822.6020.000
22.606
0.000
0.00022.59827.86222.60022.59917.64822.6370.000
22.59922.600
0.000
0.00022.60227.86822.60722.60817.64922.6020.000
22.60722.607
Source: Quarterly Report on Actual Rates Charged of Shipping Companies submitted to theMARINA.
RoutesClass ACebu/ DavaoIloilo/ BacolodIloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ SurigaoManila/ TaclobanClass BCebu/ DavaoIloilo/ BacolodIloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ RoxasManila/ SurigaoManila/ TaclobanClass CCebu/ DavaoIloilo/ BacolodIloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ RoxasManila/ SurigaoManila/ Tacloban
1998-99
1.78
-2.85
-7.47-7.47-7.47-7.47-7.47-7.47-7.47
1.78
-2.85
-7.47-7.47-7.47-7.47-7.47-7.47-7.47-7.47
1.78
-2.85
-7.47-7.47-7.47-7.47-7.47-7.47-7.47-7.47
45
Market Structure and Competition
Table 17. Annual increase in passenger rate, WG&A (%, 1995 prices)
Routes1st class suite-super 1st class suite-regular 1st class state-super
1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01
Iloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ RoxasManila/ Surigao
17.12
16.379.99
11.9312.06
7.95-1.0210.55
24.5515.2822.0520.6823.1918.2628.24
17.02
28.6413.85
5.188.517.563.27
16.97
3.82
17.84
13.517.33
11.168.926.92
-2.8510.51
19.1316.2521.3219.4525.8716.2330.35
18.41
34.8614.52
5.298.259.53
17.84
3.81
18.04
12.2511.038.485.627.59
16.888.01
30.2712.2527.4522.8835.6610.3023.7519.8222.32
26.1511.5612.8111.260.00
13.333.349.85
Routes1st class state-regular 1st class cabin-super 1st class cabin-regular
1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01
Iloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ RoxasManila/ Surigao
16.70
11.336.307.146.576.41
17.2011.84
21.3211.3324.9625.2540.6310.4023.7119.8625.28
34.3910.7711.5212.12
0.00
12.693.269.83
12.23
12.966.525.996.89
108.7818.26
9.83
33.8917.5625.7521.7627.6523.4124.6419.7925.17
26.635.58
11.9612.8914.3511.1113.16
3.2611.11
15.18
13.004.865.855.306.86
17.247.30
19.2325.0022.1727.64
2.9724.1619.7223.92
5.9811.9614.5814.4032.8414.18
3.2611.18
Routes2nd class business-super 2nd class business-regular 2nd class tourist-super
1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01
Iloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ RoxasManila/ Surigao
16.14
8.156.715.320.978.57
-2.186.76
28.5214.5427.0823.2531.7824.7927.2325.4024.22
26.6513.1715.0112.7717.0214.1015.43
11.95
15.15
7.887.517.303.609.30
-1.226.58
2.6826.1826.7122.1730.9520.9229.4623.7528.27
58.1513.3215.1911.8215.9412.3615.71
14.95
15.15
7.959.406.174.618.68
18.467.21
30.3019.2028.9525.2341.1922.1832.7715.6629.28
26.3416.8515.1312.48
8.2710.8019.08
6.9515.23
Routes2nd class tourist-regular 3rd class economy-super 3rd class economy-regular
1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01 1998-99 1999-2000 1999-01
Iloilo/ CotabatoManila/ BacolodManila/ CagayanManila/ CebuManila/ CotabatoManila/ DavaoManila/ IloiloManila/ RoxasManila/ Surigao
15.84
6.6910.6815.14
6.019.44
17.154.83
19.7927.1428.2270.0222.1935.3015.5538.71
17.0015.1712.9616.5110.5119.606.9815.17
2.99
11.500.711.690.022.002.863.31
34.7719.5646.9226.8634.8622.6638.2324.6127.75
17.3916.7415.3816.8620.6015.2222.6913.9329.03
0.31
0.20-0.860.45
-2.912.090.340.38
30.1220.0126.5126.8831.2022.3641.8525.1427.84
18.0117.1815.6916.7518.1815.1123.2714.5830.68
Source: Quarterly Report on Actual Rates Charged of Shipping Companies submitted to the MARINA.
46
Philippine Domestic Shipping Transport Industry
47
Market Structure and Competition
the large imbalance between inbound and outbound cargo traffic. That is,the ship is full from Manila to Tacloban but not vice-versa. Hence, beforederegulation, the regulated rate for the route did not reflect the cost of pro-viding the shipping services. Given the abolition of the DOSCON process,the market could have corrected the rate and contributed to the large in-crease that occurred in 2000. This argument is strengthened by the fact thatthe rate increase in 2000-2001 was already small (9.1%).
It would have been helpful to examine the cargo rates for basic com-modities as the deregulation of rates for these commodities, when container-ized, is expected to increase the rates. This is because the regulated rates fornoncontainerized basic commodities were so low that these were unattrac-tive to shipping operators. However, data on rates for basic commodities arenot available.
Based on interviews with shipping companies, during off-peak seasonwhen there is excess capacity, cut-throat competition leads to “fare diving.”Some companies go to the extent of cutting their rates to the level that is justenough to get a break-even income or recover the cost of oil. This is trueeven for regulated rates because enforcement is weak. But the worst sce-nario is when a shipping operator practices fare diving and yet still earnsprofits by overloading. This practice adversely affects competition because itpunishes operators who follow regulations. Likewise, overloading puts thesafety of passengers at risk.
Impact of competitionCompetition pressures the shipping companies to produce the quality of servicedesired by passengers and shippers at the least cost. In other words, competi-tion drives them to become efficient. Companies whose quality of service ispoor, whose costs are high or whose profit margins are excessive will lose theircustomers to their rivals and eventually be driven out the market. Thus, onlythe efficient ones remain.
This section of the paper examines how competition promotes efficiency inthe industry. Ideally, efficiency would be measured in terms of the costs andprofit margins of companies. However, financial data are difficult to obtain; andif ever they could be obtained, they may not reflect the true financial operationsas it is accepted that businessmen maintain different books of accounts depend-ing on what purpose these will be used. Thus, the analysis here deals, not onefficiency per se, but on the process by which competition promotes the level ofefficiency. This is called the transfer mechanism, defined as the process wherebyoutput is reallocated from less to more efficient operators (Dick 1987).
48
Philippine Domestic Shipping Transport Industry
The indicator used is the turnover of firms that takes into account the entryand exit of companies arising from competition. Again, only those plying theprimary and secondary routes were considered. The shipping companies areclassified into two: (i) those established before the policy reforms, called the“old order” companies; and (ii) those established after the policy reforms, calledthe “new order” companies. The cut off year is 1992 since the liberalization ofroutes occurred towards the end of that year. Also, exit is defined as when anoperator does not operate in any of the routes (primary and secondary) for twoor three consecutive years. Mergers are considered new entrants in the in-dustry.
There were about 103 shipping companies that operated in the industryduring the period 1990-1998, 76 of which were established before policy reformswere instituted and 27 were established during the reform period (Table 19). Bythe end of 1998, only 37 or 49 percent of the old order companies still existed.That is, 51 percent are no longer operating, probably due to the stiff competitionbrought about by the reforms or they have acquired new names due to mergeror acquisition.
The liberalization of route entry, on the other hand, enabled 27 newshipping companies to enter the industry during the period 1993-1998. None-theless, only 16 or 59 percent survived by the end of 1998. In other words, 11exited the industry, that is, they could have succumbed to competition.
However, despite the high survival rate of the new order companies,(59 percent as against 49 percent for the old order companies), the survivingcompanies are still dominated by the old order companies. That is, 70 per-cent of the surviving firms were established before the reforms. Likewise,these operators control about 64 percent of the industry’s cargo capacity and63 percent of passenger capacity.
It is important to note that exit from the industry was highest in 1998(15 operators) when there was financial crisis. On the other hand, entry washighest in 1994 (11 operators).
A further analysis of the surviving companies show that 43 percent ofthem are growing in their capacity; 34 percent experienced a decline in theircapacity while the remaining 23 percent did not register any change in theircapacity since they were established (Table 20). There was also a redistribu-tion of capacity from among the surviving companies. The share of the grow-ing companies increased from 51 percent in 1990 (or when they were estab-lished) to 86 percent by 1998. Their absolute tonnage in 1998 was 43 percenthigher. On the other hand, the share of the declining companies went downfrom 48 percent to 12 percent.
49
Market Structure and Competition
Table 19. Entry-exit of firms, domestic shipping industry, 1990-1999
YearCompanies
established beforepolicy reforms
Companiesestablished afterpolicy reforms
Grand total
19901991
1992
1993
1994
1995
1996
1997
1998
1999
Total
757501
7414
7102
6902
6700
6709
5807
5108
4306
37
entrantsexit
entrantsexit
entrantsexit
entrantsexit
entrantsexit
entrantsexit
entrantsexit
entrantsexit
entrantsexit
000
110
1110
1251
1652
1937
1521
16
757501
7414
7102
69112
7810
795
107459
703
155827
53
Sources: MARINA Route InventoryMARINA Vessels with Valid Authority per LinkMARINA List of Authorities Issued
Philippine Domestic Shipping Transport Industry
50
If competition is effective, the redistribution of capacity from decliningto growing companies should be accompanied by the redistribution of out-put from the less efficient to more efficient companies. Unfortunately, whetherthis in fact occurred with the surviving companies in 1998 cannot be analyzedfrom the data available. It is possible that some of the growing companieswere able to increase their capacities for reasons other than commercial effi-ciency. On the other hand, it is also possible that companies experience adecline in capacity not because of commercial pressure but because of marineloss. This could be an interesting area of further research to ascertain whetherthe competition arising from the reforms in fact increases the level of effi-ciency of the industry.
51
VII
�
The Role of MARINA in aDeregulated Environment
As presented earlier, MARINA takes charge of regulating the shipping in-dustry. Created under Presidential Decree No. 474 in 1974, the agency wasmandated, among other things, to provide for the effective supervision, regu-lation and rationalization of the organizational management, ownership andoperations of all water transport utilities and other maritime enterprises.Before the reforms were instituted, the agency’s regulatory functions includethe regulation of interisland rates, regulation of entry by granting of routecertificate of public convenience or provisionary authority, and regulation ofsafety and service standards.
Under a deregulated and liberalized environment, MARINA shouldchange the nature of how it regulates the industry so as to create the muchneeded competition and contestability in the market. This is crucial since lesscompetition has been realized, even after implementing policy reforms. In-stead of just responding to applications for new or expanded shipping ser-vices, MARINA should be proactive where the unavailability of desirableservices is concerned. It should identify underdeveloped routes or routeswhere there is shortage of vessels or routes that are not served and thenfacilitate investments for these routes by publicly inviting investors and grant-ing investment incentives. MARINA should focus on allowing new entrantsin the tertiary routes where there is practically no safe, reliable and adequateservice and where there is rampant overloading of passengers during peakseasons.
MARINA should also strengthen its developmental functions. Of par-ticular concern is MARINA’s apparent weak monitoring capabilities. Atten-tion to this concern becomes all the more important since, as discussed ear-lier, only a small percentage of the routes (whether primary, secondary ortertiary) experience substantial competition and that the top five companiesof the industry dominate the routes, regardless of the routes’ state of compe-tition. Under the current setup (MC No. 153), MARINA will intervene only ifpassengers and shippers file a complaint against the rates and services of
52
shipping companies and only if sufficient basis and justification is submitted.Such regulation should be modified. Monitoring should be on a regular ba-sis, i.e. not only when complaints are filed, to ensure that the interests ofshippers and passengers are protected against overcharging and poor ser-vice standards, and that the dominant firm or firms in each route do notabuse their market power. Regular monitoring would, in the first place, pre-vent shipping companies from making actions contrary to the regulations.
Philippine Domestic Shipping Transport Industry
Monitoring should be done in tandem with the Philippine Coast Guard(PCG) that gives the vessels the authority to sail. As discussed earlier, ashipping operator can resort to fare diving or large discounts and still earnprofits by overloading its passengers. Such practice can be avoided if thePCG strictly monitors the vessels.
However, for MARINA to be able to exercise its monitoring functionseffectively and for it to be able to identify routes requiring adequate ship-
Table 20. Surviving firms, growing and declining based on Net Registered Tonnage(NRT) change
Old Order FirmsGrowingDecliningno changeTotal
New Order FirmsGrowingDecliningno changeTotal
IndustryGrowingDecliningno changeTotal
1614737
3137
19151044
No. of firms
88,465.29151,228.58
1,755.40241,449.27
72,283.08406.00
2,110.0874,799.16
160,748.37151,634.58
3,865.48316,248.43
NRT beg
36.6462.630.73
100.00
96.640.542.82
100.00
50.8347.951.22
100.00
%
135,883.6032,438.961,755.40
170,077.96
94,508.97289.61
2,110.0896,908.66
230,392.5732,728.573,865.48
266,986.62
NRT end
79.8919.071.03
100.00
97.520.302.18
100.00
86.312.33.2
100.00
%
Note: Data for nine firms are either incomplete or notSource: MARINA Route Inventory
53
The Role of MARINA in a Deregulated Environment
ping services, a database that is easily accessible to the shipping operators,investors, researchers, policymakers, and the public in general must be es-tablished. Current regulations require shipping companies to submit to theMARINA quarterly reports of passenger/cargo traffic and the actual ratescharged by their vessels, whether regulated or deregulated. Nonetheless,such reports remain as reports and are not being processed into a database.13
The database should include, at the very least, passenger/cargo trafficand freight/passage rates by shipping company and by route; number ofoperators per route and vessel capacity per route. The effectiveness of MA-RINA as an investment facilitator and regulator on a day-to-day basis hingesmuch on the availability of this critical information. MARINA therefore needsto invest on establishing the database and on its computer facilities and hu-man resources.
MARINA should focus its regulatory power on service standards andsafety regulations to avoid maritime accidents. It should ensure the seawor-thiness of the vessels (condition of the hull, requirements for navigational/firefighting/life-saving equipment, manning requirements, etc.) and that ship-ping operators strictly observe the minimum service standards.
One particular issue confronting the MARINA these days is the basisfor the approval of upward adjustment of regulated rates. The approach cur-rently used is still the revenue deficiency method. However, the approach isno longer appropriate as the financial statements of shipping companies in-clude their deregulated operations.
13 This is based on the experience of the author in making this study. No data on freight/passage rates or passenger/cargo traffic by routes and by company are readily available.
VIII
�
Areas for Competition Policyand Further Reforms
Competition policyLiberalization and deregulation should not be undertaken in isolation. The policyreforms should be complemented by competition policy to ensure that the com-petition and other benefits arising from liberalization and deregulation are noteroded by possible development of market power among shipping lines. Asdiscussed earlier, substantial competition exists in only a small percentage of theroutes and that cartel-like arrangements have been observed to exist in the in-dustry.
One area for competition policy is on merger and acquisition or consoli-dation. Fierce competition can push companies into bankruptcy, merger orconsolidation. The latter can have both positive and negative effects. On thepositive side, efficiency could be enhanced as it allows shipping companies toconsolidate their functions like marketing, ticketing, repair and maintenance,etc. On the negative side, there is the fear that the end result will be a largecompany becoming so dominant that it can exert considerable market power.
The country’s shipping industry has seen merger and consolidation hap-pening in response to the reforms. The merger did not result to an increase inmarket power of the merged companies, at least for now, since the current con-cern of the companies is more on consolidating their functions and not much onincreasing their market share. The picture could change, however, once the con-solidation has been completed.
Hence, a policy on merger and consolidation should be defined in sucha way that mergers and consolidation would not result to reduced serviceand less competition. The efficiency effects should be weighed against themarket power effects. In short, merger should be in the interests of the trav-eling public.
Another important area to consider is the development of the tertiaryroutes. The shipping industry has become an important source of competi-tion for the air transport industry in providing transport services to thecountry’s islands in the south (Austria 2000). The system of providing gov-
54
55
ernment incentives to shipping operators developing the tertiary routes shouldtherefore be designed in such a way that the efficiency arising from theintermodal competition will not be distorted.
Further reformsThe government should continue its deregulation efforts. Of particular inter-est is the regulated rate for non-DOT accredited vessels that either only of-fers first and second class accommodation or whose third class accommoda-tion is less than 50 percent of the total passenger capacity. This regulation hasno rationale as the first class and second class passenger services have al-ready been deregulated.
One important issue remaining for deregulation is the third class pas-senger service. About 70 percent of passengers take the third class service,majority of whom also come from the C-D crowd. The regulated rate for thisservice is regarded by shipping companies as very low and cannot covercost. The operation is therefore cross-subsidized, and often by cargo rev-enue. Since most of the cargo rates are already deregulated, passenger-cargovessels are placed at a disadvantage against pure cargo vessels because cross-subsidization is no longer feasible under a deregulated environment. This isalso aggravated by the fact that current regulation requires passenger ves-sels to allocate 50 percent of their passenger capacity to third class passen-gers, except for DOT-accredited vessels. Given the sensitivity of the issuebecause of its social implications, any attempt to deregulate the third classpassenger service should be carefully looked into. A balance should be struckbetween social objectives and economic efficiency.
Two other significant areas for reform are the ceiling on the return oninvestment and the application of the revenue deficiency method for upwardadjustment of regulated rates. Both are anticompetitive. The ceiling on ROIserves as a disincentive for efficient shipping companies because the returnmay not be commensurate to the level of service rendered. Based on theresults of the interview, many of the shipping companies regard shipping asless profitable than other competing investments. The ceiling on ROI makesthe industry less attractive to investors.
On the other hand, the revenue deficiency method awards inefficientcompanies because it guarantees return, regardless of the level of efficiency.As presented earlier, the method can no longer be applied under the newenvironment because the financial statements of companies also include theirderegulated operations.
Areas for Competition Policy and Further Reforms
56
IX
�
Summary and Conclusions
Regulation has a long history in the country’s shipping industry. This paperexamined the conflicting forces of past government regulations and competi-tion and their impact on the industry. The restrictive regulations have weak-ened, if not prevented, competition thereby rendering them ineffective inachieving the avowed aim of regulatory policy, which is to promote effi-ciency.
The inefficiency and the consequent adverse impacts on the economyprompted the government to institute reforms through liberalization andderegulation in the 1990s. Competition has improved, undermining industrypractices leading to an improvement in the quality of service. Nonetheless,substantial competition exists in only a small percentage of the routes. Agreater majority of the routes are still effectively monopolized or experienceonly mild competition. The top three or top five companies in the industryeffectively dominate the different routes, regardless of the routes’ state ofcompetition. What is more striking is the large increase in cargo and passen-ger rates after the reforms. The cartel-like arrangement that is observed toexist in the industry may have contributed to this.
The policy reform has been a slow process and much is still desired.There is a need for competition policy to ensure that the benefits derivedfrom liberalization and deregulation will not be eroded by the possible abuseof market power among the shipping lines. Likewise, the commercial successor failure of shipping companies in a liberalized and deregulated environ-ment hinges much on their responsiveness to market requirements; in short,their competitiveness. However, competitiveness depends on a host of fac-tors that include shipping costs and physical and administrative infrastructures. It has always been argued that domestic shipping costs (fuel,interest rate, insurance, and income and freight taxes) and handling costs inthe country are higher than other countries in the region (Lorenzo 1997; PISA2001). On the other hand, port facilities in the country are far below world-class standards, with some ports still undeveloped.
57
Summary and Conclusions
Finally, the high domestic shipping cost in the country is causing thepressure for the lifting of the cabotage law to enable domestic shippers availof lower shipping costs from foreign vessels. The lifting of the cabotage lawwill expose interisland shipping to the pressures of international competi-tion. This would be advantageous for the country in the long run as it willincrease the pressure for efficiency among all players in the industry. How-ever, the government needs to identify what measures and actions must beundertaken, including their sequencing, during the transition to full liberal-ization in order to prepare domestic shipping lines against foreign competi-tion. At the very least, the domestic shipping environment should be im-proved by addressing the domestic issues (as mentioned above) affecting theindustry’s competitiveness.
58
Appendixes
Appendix Table 1. Dominant/effective players per route per type of market, passengertraffic, primary routes, 1998
Effective CompetitorsHerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
0.54
0.54
0.35
0.54
0.37
0.61
0.51
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.86
1.87
2.89
1.84
2.70
1.64
1.96
Name of Operator/s
Sicat Ferries, Inc.
Cebu Ferries Corp
Sulpicio Lines Inc
Sulpicio Lines Inc
Negros Navigation
Sulpicio Lines Inc
Sulpicio Lines Inc
George and Peter Lines
Sulpicio Lines Inc
Negros Navigation
Sulpicio Lines Inc
George and Peter Lines
Negros Navigation
Sulpicio Lines Inc
Sulpicio Lines Inc
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
WG&A Philippines
Sulpicio Lines Inc
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
Cebu Ferries Corp, Sulpicio Lines
Cebu Ferries Corp, Sulpicio Lines
Company B*, Arrel Shipping,
Victoriano Millanes
WG&A, Sulpicio Lines
Sulpicio Lines, WG&A, Negros
Navigation
Sulpicio Lines, Negros Navigation
WG&A, Sulpicio Lines
Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Routes with only 1 operator
Batangas/ Puerto Princesa
Cagayan de Oro/ Tagbilaran
Cebu/ Dadiangas
Cebu/ Davao
Cebu/ Estancia
Cebu/ Masbate
Cebu/ Nasipit
Cebu/ Zamboanga
Dadiangas/ Zamboanga
Davao/ Zamboanga
Dumaguete/ Ozamis
Dumaguete/ Zamboanga
General Santos/ Zamboanga
Iligan/ Tagbilaran
Iloilo (Estancia)/ Zamboanga
Iloilo/ Davao
Iloilo/ General Santos
Iloilo/ Iligan
Iloilo/ Palawan
Manila/ Batangas
Manila/ Dadiangas
Manila/ San Carlos
Manila/ Zambales
Palawan/ Cagayan de Oro
Palawan/ Davao
Palawan/ General Santos
Routes with at least 2 operators
Routes with substantial competition
Cagayan de Oro/ Jagna
Cebu/ Cagayan de Oro
Cebu/ Tubigon
Manila/ Dipolog
Manila/ Dumaguete
Manila/ Estancia
Manila/ Masbate
PasssengersCarried
35,801
3,682
4,663
11,797
264
1,855
4,244
7,311
34,521
5,381
10,995
9,671
12,199
3,056
22,869
7,919
25,370
8,799
22,285
128,225
18,608
5,960
6,460
3,311
127
225
197,636
158,758
181,314
91,099
356,754
56,761
139,328
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2
2
3
2
3
2
2
59
Appendixes
Appendix Table 1. ContinuedEffective CompetitorsHerfindahl
Index(HHI)
PasssengersCarried Number=
1/HHI Name of Operator/s ShareRoute
Numberof
Operators
0.88
0.97
0.86
0.73
0.97
0.37
0.33
0.71
0.51
0.68
0.54
0.40
0.52
0.60
0.64
0.60
0.54
0.46
0.67
2,916
2,359
51,695
100,322
103,980
239,093
277,557
1,746
12,524
11,257
472,250
406,331
663,471
175,719
128,207
645,024
186,402
192,526
176,144
1.13
1.03
1.17
1.37
1.03
2.69
3.07
1.40
1.97
1.47
1.87
2.49
1.92
1.66
1.56
1.66
1.86
2.17
1.50
Cebu Ferries Corp
Negros Navigation
Negros Navigation
WG&A Philippines
WG&A Philippines
Romulo Wagwag, Ormoc
Enterprises, MY Lines
Phil Fast Ferry, Negros Navigation,
George and Peter Lines
Sulpicio Lines
Cokaliong Shipping,
Negros Navigation
Cebu Ferries Corp
Phil Fast Ferry, Negros Navigation
Sulpicio Lines, WG&A
WG&A, Sulpicio Lines
WG&A, Sulpicio Lines
WG&A
Negros Navigation, WG&A
WG&A, Negros Navigation
WG&A, Negros Navigation
WG&A
93.8
98.6
92.2
84.1
98.5
83.2
84.3
82.8
98.5
80.4
96.5
87.6
97.7
90.8
78.3
98.7
96.3
93.1
79.0
Routes with only 1 effective competitor
Cebu/ Jagna
Davao/ General Santos
Dumaguete/ Tagbilaran
Manila/ Gen. Santos
Manila/ Nasipit
Routes with mild competition
Cebu/ Bohol
Cebu/ Dumaguete
Cebu/ General Santos
Cebu/ Iloilo
Cebu/ Palawan/ Puerto Princesa
Cebu/ Tagbilaran
Manila/ Cagayan de Oro
Manila/ Cebu
Manila/ Davao
Manila/ Iligan
Manila/ Iloilo
Manila/ Palawan/ Puerto Princesa
Manila/ Tagbilaran
Manila/ Zamboanga
2
2
2
3
3
9
6
2
3
3
3
3
3
3
3
3
3
3
2
Source: 1998 Annual Traffic Reports of Shipping Companies submitted to the MARINA.
Philippine Domestic Shipping Transport Industry
60
Appendix Table 2. Dominant/effective players per route per type of market, passengertraffic, secondary routes, 1998
Effective CompetitorsHerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s
Shipshape Ferry, Inc.
Sulpicio Lines Inc
Negros Navigation
FJP Lines
Lapu Lapu Shipping Lines
Cebu Ferries Corp
Age Shipping Lines
Sulpicio Lines Inc
Sulpicio Lines Inc
Negros Navigation
George and Peter Lines
Sulpicio Lines Inc
Cokaliong Shipping Lines
Sulpicio Lines Inc
Negros Navigation
Negros Navigation
Negros Navigation
San Nicolas Lines Inc.
Sulpicio Lines Inc
San Nicolas Lines Inc.
WG&A Philippines
Sulpicio Lines
Sulpicio Lines Inc
Cebu Ferries Corp
Rogelio Tan
Sulpicio Lines Inc
Sulpicio Lines Inc
Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Routes with only 1 operator
Batangas/ Romblon
Baybay/ Maasin (Leyte/ Leyte)
Cebu/ Bacolod*
Cebu/ Calbayog
Cebu/ Catanduanes
Cebu/ Tacloban
Cebu/ Talibon
Cotabato/ Iloilo
Cotabato/ Zamboanga
Dapitan/ Tagbilaran
Dapitan/ Zamboanga
Davao/ Surigao
Dumaguete/ Leyte (Maasin)
Dumaguete/ Ozamis
Iligan/ Ozamis
Iloilo/ Bacolod*
Iloilo/ Ozamis
Manila/ Coron
Manila/ Leyte (Baybay/ Maasin)
Manila/ Mindoro (Tilik)
Manila/ Tacloban
Masbate/ Leyte (Baybay/ Maasin)
Masbate/ Surigao
Palawan/ Tacloban
Surigao/ del Carmen
Surigao/ Leyte (Baybay)
Surigao/ Maasin
PasssengersCarried
6,760
4 4
2,998
12,571
37,056
40,933
46,984
9,318
26,703
8,763
793
3,182
6 8
10,995
7 0
1,274,943
6,635
4,538
8,018
7,217
46,940
326
805
118
1,189
1,650
2,768
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Appendixes
61
Appendix Table 2. ContinuedEffective CompetitorsHerfindahl
Index(HHI)
0.50
0.56
0.51
0.62
0.54
0.54
0.89
0.97
0.90
0.72
1.00
0.79
0.76
0.45
0.57
0.52
0.42
0.64
0.66
Number=1/HHI
2.00
1.78
1.96
1.62
1.84
1.84
1.12
1.03
1.11
1.39
1.00
1.26
1.32
2.24
1.75
1.92
2.38
1.56
1.51
Name of Operator/s
Concepcion Ang, Adelia Membreve
Sulpicio Lines, Cebu Ferries Corp
Cebu Ferries Corp, Sulpicio Lines
MY Lines Inc, San Juan
Shipping Corp
WG&A, Negros Navigation
WG&A, Sulpicio Lines
Santos Cruz
Cokaliong Shipping Lines
Cebu Ferries Corp
Cokaliong Shipping Lines
Negros Navigation
WG&A Philippines
Sulpicio Lines
Negros Navigation, George and
Peter Lines
Southern Pacific Transport Corp
Phil Fast Ferry Corp, Cebu
Ferries Corp
Negros Navigation, George and
Peter Lines
WG&A Philippines
WG&A Philippines
Share
100.0
100.0
100.0
100.0
100.0
100.0
94.3
98.6
94.8
83.2
99.9
88.4
85.9
94.4
70.0
84.3
80.8
78.2
78.7
Route
Routes with at least 2 operators
Routes with substantial competition
Bohol (Ubay)/ Leyte (Maasin or Bato)
Cagayan de Oro/ Tacloban
Cebu/ Butuan*
Cebu/ Palompon
Manila/ Roxas
Manila/ Surigao
Routes with only 1 effective competitor
Bato/ Maasin (Leyte/Leyte)
Cebu/ Dipolog*
Cebu/ Ozamis
Cebu/ Surigao
Manila/ Bacolod*
Manila/ Cotabato
Manila/ Ormoc
Routes with mild competition
Cebu/ Dapitan
Cebu/ Leyte
Cebu/ Ormoc
Dumaguete/ Dapitan
Manila/ Ozamis
Manila/ Palompon
PasssengersCarried
3,506
987
298,773
7,251
256,116
187,004
11,614
17,900
318,299
60,083
571,605
101,900
27,753
43,931
44,861
568,271
87,065
148,083
45,169
Numberof
Operators
2
2
2
2
2
2
2
2
2
2
2
2
2
4
3
6
4
3
2
Source: 1998 Annual Traffic Reports of Shipping Companies submitted to the MARINA.
Philippine Domestic Shipping Transport Industry
62
Appendix Table 3. Dominant/effective players per route per type of market, passengertraffic, tertiary routes, 1998
Effective CompetitorsHerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s
Seaford Shipping Lines
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
Negros Navigation
Dionisio Albania
Sulpicio Lines Inc
Sofronio Bogtai
Sofronio Bogtai
Sofronio Bogtai
Sofronio Bogtai
Patrocinio Cuaca
Tabango Express
Patrocinio Cuaca
Elizabeth Carino
Sulpicio Lines Inc
Sto. Nino Ferry Boat Services
Arturo Olasiman
Arturo Olasiman
Cesar Sitjar
Teresita Koga
Sulpicio Lines Inc
Philippine Fast Ferry
Gomez Brothers Shipping Lines
Margarito Tan
Dionisio Montalban
Iluminado Dacallos
Agustine Romano
Manuel Estrada
Emilio Morate
Florencio Apacible
Florencio Apacible
Reynaldo Cajefe Jr
Agustine Romano
Antonio Vencio
Avelino Arraz
Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Routes with only 1 operator
Bacolod/ Bataan
Bacolod/ Cagayan de Oro
Bacolod/ Davao
Bacolod/ Estancia
Bacolod/ General Santos
Bacolod/ Legaspi
Bacolod/ Ozamis
Bacolod/ Palawan
Bacolod/ Zamboanga
Batangas (Tinglay)/ Batangas (Mabini)
Baybay/ Calubian
Baybay/ Kawit
Baybay/ Moabog
Baybay/ Monsirat
Baybay/ San Juan
Bogo/ Placer
Bogo/ Tabango
Bogo/ Villaba
Buenavista/ Iloilo
Butuan/ Cagayan de Oro
Cadiz/ Bantayan
Calbayog / Guinbarocan
Calbayog/ Labangbaybay
Calbayog/ Maripipi
Calbayog/ Tagapulaan
Calubian/ Maasin
Camiguin/ Ormoc
Carbon/ Inabangan
Catbalogan/ Borongan
Catbalogan/ Brgy Saugan
Catbalogan/ Buenavista
Catbalogan/ Canhawan Gote
Catbalogan/ Daram
Catbalogan/ Guintarean
Catbalogan/ Haplaan
Catbalogan/ Jocopon
Catbalogan/ San Rogue
Catbalogan/ Sitio Bitoon
Catbalogan/ Tarangnan
Catbalogan/ Villareal
PasssengersCarried
589
37,524
1,332
3
1,514
1,547
467
14,709
2,385
3,400
3 5
440
250
425
511
10,176
1,452
18,421
584
125
6,533
550
550
1,950
606
5
2,844
9,841
1,992
7,948
1,730
4 9
12,480
5,640
430
3,036
4,899
5 0
294
3,668
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
63
Appendixes
Appendix Table 3. Continued
Effective CompetitorsHerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s
Palacio Shipping
Concepcion Ang
Roble Shipping
Carmelo Simolde
Metro Ferry Cebu
Palacio Shipping Inc
George and Peter Lines
FJP Lines
Roger Bandao
Virgilio Arbolado
Virgilio Arbolado
Sulpicio Lines Inc
Carlito Latonio
Sofronio Bogtai
Sofronio Bogtai
Cesar Sitjar
George and Peter Lines
Sulpicio Lines Inc
Sulpicio Lines Inc
Sulpicio Lines Inc
Gaudencio Baruc
Gaudencio Baruc
Negros Navigation
German Gutierrez
Teresita Gananan
Nomn Novyar
Tripple "S" Divers Services
Tripple "S" Divers Services
Negros Navigation
George and Peter Lines
Sulpicio Lines Inc
Negros Navigation
Negros Navigation
Sulpicio Lines Inc
Tripple "S" Divers Services
Tripple "S" Divers Services
M/ V Intan
Zenaida Petracorta
Tristar Sea Ventures Inc
Saturnino Atienza
Antonio Mogasa
Casiano Obligado, Jr
Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Cebu/ Camotes
Cebu/ Dawahon
Cebu/ Hiligaynon
Cebu/ Jetafe
Cebu/ Lapu-lapu
Cebu/ Larena
Cebu/ Lazi
Cebu/ Sta Fe
Cogon/ Sta Ana
Cuyo/ El Nido
Cuyo/ San Vicente
Dadiangas/ Iloilo
Danao/ Camotes
Danao/ Kawit
Danao/ Moabog
Danao/ Naval
Dapitan/ Lazi
Davao/ Dadiangas
Dipolog/ Iligan
Dipolog/ Tagbilaran
Doong / Hagnaya
Doong/ Vito
Dumaguete/ Estancia
Gravahan/ Pag-asa
Guimaras/ Pulupandan
Guimaras/ Roxas City
Hilutungan/ Boyong
Hilutungan/ Shangrila
Iligan/ Bacolod
Iligan/ Lazi
Iligan/ Ormoc
Iloilo/ Cagayan de Oro
Iloilo/ Zambales
Jagna/ Nasipit
Kalusuan/ Boyong
Kalusuan/ Shang rila
Lapinig,Garcia/ Bohol (Ubay)
Limasawa/ P. Burgos
Mactan/ Dumilon
Madredejos/ Kawit
Magalona/ Iloilo
Mandaue/ Bohol
PasssengersCarried
5,302
2,604
31,696
23,901
2,933,142
3,855
167
12,949
22,501
2 0
5 5
9,211
18,680
455
569
9 4
543
3 4
534
12,065
231
130
3
238,416
600
204
3
103
725
2,919
189
52,247
6,635
1,042
1 5
155
5,268
10,968
572
4,731
3,055
5,174
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
64
Philippine Domestic Shipping Transport Industry
Appendix Table 3. Continued
Effective CompetitorsHerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s
Sulpicio Lines Inc
Sulpicio Lines Inc
Sun Cruises
WG&A Philippines
San Nicolas Lines Inc.
Negros Navigation
Ever Lines
Ever Lines
Ever Lines
Sulpicio Lines Inc
Arturo Susas
Sulpicio Lines Inc
Edison Dalag
San Nicolas Lines Inc.
San Nicolas Lines Inc.
San Nicolas Lines Inc.
Cesar Sitjar
Teodulo Lapure
Teodulo Lapure
Teodulo Lapure
Cesar Sitjar
Teodulo Lapure
Teodulo Lapure
Teodulo Lapure
Teodulo Lapure
Teodulo Lapure
Teodulo Lapure
Manuel Perez
Antonieto Pedericos
Sofronio Bogtai
Sofronio Bogtai
Sofronio Bogtai
Sofronio Bogtai
Sofronio Bogtai
M/V Lilly/ Dona Antonina/ Dona Anita
Daima Shipping Corp
M/V Lilly/ Dona Antonina/ Dona Anita
Armando Salva
Eutiquio Caringal
Rolando Liwanag
Jaime Macaya
Magnolia Shipping Corp
Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Manila/ Butuan
Manila/ Calubian
Manila/ Corregidor
Manila/ Dumaguit
Manila/ El Nido- Liminangcong
Manila/ Zambales
Margos/ Malangas
Margos/ Subanipa
Margos/ Talusan
Masbate/ Calubian
Masbate/ Maya
Masbate/ Ormoc
Maya/ Logon
Mindoro/ Burunga
Mindoro/ Libertad
Mindoro/ Semerara
Naval/ Bato
Naval/ Binalayan
Naval/ Burabod
Naval/ Calbani
Naval/ Canduhao
Naval/ Casibang
Naval/ Hagonoy
Naval/ Maripipi
Naval/ Trabugan
Naval/ Ulog
Naval/ Viga
Odiongan/ Oangay
Ormoc/ Camotes (Pilar)
Ormoc/ Dapdap
Ormoc/ Kawit
Ormoc/ Lanao
Ormoc/ Moabog
Ormoc/ Monsirat
Ozamis/ Kolambugan
Ozamis/ Mukas
Ozamis/ Tubod
Paradise/ Insular
Perez/ Antimonan
Romblon/ Lucena
Romblon/ San Agustin
Sagasa/ Alicia
PasssengersCarried
22,026
11,813
25,235
43,567
1,557
6,460
4,041
3,328
1,495
833
6,415
3,123
6,023
2,630
7,173
8,136
2,260
107
101
8 4
2,110
7 6
165
168
9 1
7 3
6 3
3,666
19,240
1,228
1,050
1,035
990
733
36,279
491,114
35,741
30,800
5,180
4 2
600
518
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
65
Appendixes
Appendix Table 3. Continued
Effective CompetitorsHerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s
Analita Richa
Myrna Espinosa
Juana Lopez
Negros Navigation
Danilo Lines
San Nicolas Lines Inc.
Robinson Royo
Timoteo Batton
Timoteo Batton
Celeste Tenperateba
Santa Rosa Sea Trans, Inc.
Tripple "S" Divers Services
Tripple "S" Divers Services
Tripple "S" Divers Services
Jose Castro
Magnolia Shipping Corp
Tripple "S" Divers Services
Tripple "S" Divers Services
Tripple "S" Divers Services
Honesto Lipao
Sulpicio Lines Inc
BCT Shipping Lines
Vicente Mejia
Genara Malbacias
Leonardo Dauhog
Leonardo Dauhog
Pedro Felizarta
Pedro Felizarta
Joedina Baleos-Gumagay
Romulo Alvarina
ABC Liner & Ferry Boat Services
Magnolia Shipping Corp
P.S. Rodriguez Ferry Service
Jeffrey Pages
Magnolia Shipping Corp
Aleson Shipping Lines
Company A*
Sampaguita Shipping Corp.
Sampaguita Shipping Corp.
Sampaguita Shipping Corp.
Sampaguita Shipping Corp.
Magnolia Shipping Corp.
Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Samal/ Caliclic
Samal/ Davao City
Samar/ Mandaue
San Carlos/ Estancia
San Carlos/ Toledo
San Jose/ Antique
Sibuyan/ Roxas
Sta Ana/ Isla Rita
Sta Ana/ Pearl Farm
Sta Cruz/ Tucanga
Sta Rosa/ Ang-asil
Sta Rosa/ Boyong
Sta Rosa/ CMMC
Sta Rosa/ Shangrila
Sto Tomas/Talaga
Subanipa/ Malangas
Sulpa/ Boyong
Sulpa/ CMMC
Sulpa/ Shang rila
Surigao/ Cagdianao
Surigao/ Calubian
Surigao/ Dapa
Surigao/ Pinut-an
Surigao/ Quezon (Albor)
Tab-oc/ Bagacay
Tab-oc/ Hingatungan
Tab-oc/ San Francisco
Tab-oc/ Tib-o
Tacloban/ Balangiga
Tacloban/ Giporlos
Talisay/ Tampi
Talusan/ Alicia
Tangil, Dhug/ Negros
Tangil/ Dumanjug
Zamboanga/ Alicia
Zamboanga/ Basilan
Zamboanga/ Dipolog
Zamboanga/ Pagadian
Zamboanga/ Sandakan
Zamboanga/ Siocon
Zamboanga/ Sirawai
Zamboanga/ Talusan
PasssengersCarried
14,464
22,311
392
9 6
128,321
6,416
365
2,600
692
12,784
50,888
1 6
3
1 8
9,800
401
168
5 9
129
1,193
178
33,750
4,178
470
385
360
487
314
1,838
1,515
19,971
586
73,409
51,254
1,876
134,191
4 1
17,847
6,285
11,845
10,803
3,540
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Philippine Domestic Shipping Transport Industry
66
Appendix Table 3. Continued
Effective CompetitorsHerfindahlIndex(HHI)
0.54
0.50
0.55
0.54
0.50
0.50
0.52
0.54
0.53
0.50
0.54
0.57
0.50
0.56
0.51
0.54
0.21
1.00
0.86
0.83
0.94
0.93
0.80
0.89
0.81
0.80
0.85
0.15
0.47
Number=1/HHI
1.85
1.98
1.83
1.84
1.99
1.99
1.93
1.86
1.90
1.99
1.85
1.76
2.00
1.78
1.96
1.85
4.76
1.00
1.16
1.21
1.07
1.08
1.24
1.13
1.23
1.25
1.18
6.52
2.13
Name of Operator/s
Almyre Cortez, Santiago Regalado
Sulpicio Lines, Cebu Ferries Corp
San Juan Shipping Lines, MY Lines
Jose Pedida, Virgilio Arbolado
Jose Pedida, Virgilio Arbolado
Magnolia Shipping Corp.,
Sampaguita Shipping Corp
Rodolfo Monilla, Juanito Tiu
Miller Santiago, Michael Jude
Placencia
Isidro Refil Jr, Michael Jude
Placencia
Cipriano Buante, Arturo Susas
Glifford Roy, Eladio Olit
Ever Lines, Magnolia Shipping Corp
Magnolia Shipping Corp.,
Sampaguita Shipping Corp
Magnolia Shipping Corp., Ever Lines
Magnolia Shipping Corp.,
Sampaguita Shipping Corp
Magnolia Shipping Corp., Ever Lines
Cesar Radjab, Candido Balunos,
Zosimo Barsarsa, Paquito Osake
Phil Fast Ferry Corp
RP Tamula and Sons
Cebu Ferries Corp
Cebu Ferries Corp
Felicisima Villanueva
Manolito Ompad
Lina Riega
Ever Lines
DIMC Shipping Inc
Zenaida Esperanza
Gaspar Valera, Bords Transport Corp
Hadjio Ahmad, Magnolia Ship. Corp.
Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
99.9
92.6
90.4
96.8
96.2
89.0
94.0
89.6
89.1
91.9
46.2
36.5
Route
Routes with at least 2 operators
Routes with substantial competition
Bataan/ Dumanguit
Butuan/ Jagna
Cebu/ Naval
Cuyo/ Iloilo
Cuyo/ Roxas
Jolo/ Sitangkai
Magallanes/ Butuan
Masbate/ Iloilo
Masbate/ Roxas
Maya/ San Isidro
Romblon/ Roxas
Sagasa/ Talusan
Siasi/ Sitangkai
Zamboanga/ Sagasa
Zamboanga/ Sitangkai
Zamboanga/ Subanipa
Paradise Beach/ Caltex Sosa
Routes with only one (1) effective competitor
Batangas/ Mindoro (Calapan)
Benoni/ Balingoan
Cebu/ Camiguin
Cebu/ Iligan
Sta Ana/ Ekron
Sta Rosa (Lapulapu)/ Dap-dap
(Lapulapu)
Surigao/ Basilica
Zamboanga/ Malangas
Dumaguete/ Larena
Zamboanga/ Tawi- tawi
Routes with mild competition
Babak/ Sasa
Bongao/ Sitangkai
PasssengersCarried
60,083
137,069
11,026
125
105
1,593
1,090
13,732
15,400
28,057
782
3,686
1,762
5,156
2,455
12,935
54,058
1,341,506
229,947
197,635
1,582,824
114,276
161,792
14,838
8,392
62,788
930
861,367
8,127
Numberof
Operators
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
5
2
2
2
2
2
2
2
2
3
3
9
3
67
Appendixes
Appendix Table 3. Continued
Effective CompetitorsHerfindahlIndex(HHI)
0.07
0.07
0.65
0.71
0.44
0.43
0.51
0.69
0.16
0.48
0.39
0.69
0.40
0.34
0.24
0.45
0.49
0.63
0.64
Number=1/HHI
15.26
15.31
1.54
1.41
2.26
2.31
1.97
1.46
6.26
2.08
2.56
1.45
2.50
2.95
4.11
2.22
2.06
1.59
1.56
Name of Operator/s
Dioneto Villanueva, Charlito
Villanueva, Fulgencio Aron, Jerly
Cooper, Avelino del Rosario, Pablo
Villanueva, Dante Elisio, Jorge
Pelayo, Antonio Alcazaren,
Aguinaldo dela Torre, Bobby Cahilig,
Rolando Tapuz, Reynaldo Bantang,
Gertacio Gumboc, Nellie Tamboon
Maria Balena, Santiago Siloterio,
Leonardo Tarrarona, Danny
Guillermo, Nerissa Pelingon,
Agripino Alcoran, Ed Gando,
Visitacion Galotera, Romeo Tigolo,
Ed Colmenares, Nelia Camon,
Bellardo Espinosa, Ernesto
Cedalanga, Fernando Espinosa,
Ely Canja
Neva Quezon
Romeo Derio
Sampaguita Shipping Corp
Hadjio Ahmad
Max Baat, Matilde Baat
Franco Mabigat
Erlinda Atianzar, Andrea Vargas
Hadjio Ahmad, Sampaguita
Shipping Corp
Lucita Balanay
Martino Palacio
Rogelio Martines
Jesus Parilla, Mario Reta
Tomas Alvares, Gregorio Pernia
Sampaguita Shipping Corp
Sampaguita Shipping Corp
Ever Lines
Magnolia Shipping Corp
Share
84.3
81.6
77.2
82.5
59.7
59.0
80.3
80.5
39.5
83.3
58.5
81.1
56.3
79.2
59.8
61.2
66.5
82.9
76.5
Route
Caticlan/ Boracay
Guimaras/ Iloilo
Guimaras/ Negros Occidental
Iloilo (Estancia)/ Iloilo (Gigante)
Jolo/ Bongao
Jolo/ Siasi
Liloan/ Sibulan
Palawan/ Mindoro (San Jose)
Penaplata/ Sta Ana
Siasi/ Bongao
Siquijor/ Dumaguete
Sta Ana/ Kapution
Sta Ana/ Samal
Sta Ana/ Sta Cruz
Sta Cruz/ Quezon (Catanauan/
Gen Luna)
Zamboanga/ Bongao
Zamboanga/ Jolo
Zamboanga/ Margosatubig
Zamboanga/ Siasi
PasssengersCarried
97,275
146,576
23,434
2,717
8,371
7,967
7,952
2,310
194,507
6,883
50,562
65,883
38,652
75,487
4,322
9,585
33,318
12,930
4,647
Numberof
Operators
3 3
2 1
2
3
3
3
4
2
7
3
6
3
5
4
5
3
4
2
2
Source: 1998 Annual Traffic Reports of Shipping Companies submitted to the MARINA.
68
Philippine Domestic Shipping Transport Industry
Sampaguita Shipping Corp.
Sun Lines
Magnolia Shipping Corporation
Sulpicio Lines Inc.
Sun Lines
Negros Navigation Company
Sampaguita Shipping Corp.
Ocean Express Shipping Corp
Ocean Express Shipping Corp
Sulpicio Lines Inc.
Arrel Shipping
Sulpicio Lines Inc.
Magnolia Shipping Corporation
Cebu Ferries Corporation
Sulpicio Lines Inc.
William, Gothong & Aboitiz, Inc.
William Michael Shipping Corp.
William Michael Shipping Corp.
William Michael Shipping Corp.
Sulpicio Lines Inc.
Magnolia Shipping Corporation
Sulpicio Lines Inc.
William, Gothong & Aboitiz, Inc.
William, Gothong & Aboitiz, Inc.
Sampaguita Shipping Corp.
Via Marine Corporation, Terban
Marine Corp
Terban Marines Corp, Via
Marine Corp
Terban Marines Corp, Via
Marine Corp
Cebu Ferries Corp, Sulpicio Lines
Sulpicio Lines, Lite Shipping
Corp, Cebu Ferries Corp
Sun Lines, Magnolia Shipping
Lines
Sulpicio Lines, WG&A
Appendix Table 4. Dominant/effective players per route per type of market, cargo revenue,primary routes, 1998
Effective CompetitorsNumber=
1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.69
1.81
1.97
1.84
2.99
1.66
1.90
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Routes with only 1 operator
Cagayan de Oro/Iligan/Tagbilaran
Cebu/ Cotabato/ Dumaguete
Cebu/ Cotobato/Gen. Santos
Cebu/ Dadiangas
Cebu/ Dumaguete/ Gen Santos
Cebu/ Estancia
Cebu/ Iligan/Cagayan de Oro
Cebu/ Iligan/Iloilo
Cebu/ Iloilo/ Palawan (Brookes)
Cebu/ Nasipit
Cebu/ Tubigon
Dadiangas/ Zamboanga
General Santos/ Cebu/ Dumaguete
Iligan/ Cagayan
Iloilo (Estancia)/ Zamboanga
Iloilo/ Puerto Princesa/ Palawan
Manila/ Batangas
Manila/ Cebu/ Iligan
Manila/ Cebu/ Iligan/ Dumaguete
Manila/ Dadiangas
Manila/ General Santos/Cebu
Manila/ Nasipit
Manila/ Puerto Princesa
Palawan/ Davao
Tagbilaran/Iligan/Cebu
Routes with at least 2 operators
Routes with substantial competition
Batangas/ Puerto Princesa
Batangas/Masbate/Puerto Princesa
Batangas/Pasacao/Puerto Princesa
Cagayan/ Jagna
Cebu/ Jagna
Cebu/ Zamboanga/Gen Santos
Manila/ Dipolog
CargoRevenue
72,436.80
18,496.00
14,114.50
25,933,846.19
53,297.10
22,325.00
67,992.30
103,600.00
132,700.00
641,884.59
134,851.50
21,520,435.14
98,711.50
1,453.38
7,229,858.05
24,448.44
4,641,173.87
110,372.85
288,072.64
54,455,246.17
114,543.60
3,986,782.48
49,564,716.59
776,404.12
147,424.40
4,702,649.71
2,679,924.29
1,477,070.66
822,316.86
2,031,495.45
188,046.90
23,882,824.87
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
0.59
0.55
0.51
0.54
0.33
0.60
0.53
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2
2
2
2
3
2
2
69
Appendixes
Sulpicio Lines, Negros Navigation
Sulpicio Lines, WG&A
Negros Navigation, Seaford
Shipping Lines
Sulpicio Lines
Teng Tick Hua
Phil Fast Ferry Corp
WG&A Philippines Inc
George and Peter Lines
Negros Navigation
Sulpicio Lines
Cebu Ferries Corp, Triton
Shipping Corp
Ormoc Enterprises, Lite Shipping
Corp, Nelson Uy, Manolito Abapo
Cebu Ferries Corp, Sulpicio Lines
Sulpicio Lines, Lorenzo
Shipping Corp
Phil Fast Ferry Corp, George and
Peter Lines
Cebu Ferries Corp, Sulpicio
Lines, WG&A
Negros Navigation, Cokaliong
Shipping, WG&A,Lorenzo Shipping
Victan Transport Services, Negros
Navigation, Cebu Ferries Corp
George and Peter Lines, Sulpicio
Lines, Lite Shipping Corp
WG&A Philippines Inc
Negros Navigation, Phil Fast Ferry
Corp, Philip Go
Negros Navigation, WG&A,
Galactic Shipping
Sulpicio Lines, WG&A
WG&A, Negros Navigation
Negros Navigation, WG&A
Negros Navigation, Hosanna
Shipping
Negros Navigation, WG&A
Appendix Table 4. ContinuedEffective Competitors
Number=1/HHI
1.78
1.84
1.99
1.13
1.38
1.26
1.30
1.12
1.01
1.05
1.84
3.59
2.19
1.85
1.78
2.67
3.68
3.19
2.56
1.49
2.57
2.94
1.71
2.08
2.16
2.33
2.02
Name of Operator/s Share
100.0
100.0
100.0
94.0
84.0
89.0
87.0
94.0
99.0
98.0
84.0
87.0
91.0
84.0
84.0
82.0
81.0
94.0
2.2
80.0
94.2
85.7
95.6
98.0
95.1
76.4
90.6
94.8
90.6
Route
Manila/ Estancia
Manila/ Masbate
Manila/ San Carlos
Routes with only 1 effective competitor
Cebu/ Masbate
Cebu/ Puerto Princesa
Cebu/ Tagbilaran
Davao/ Zamboanga
Dumaguete/ Zamboanga
Iloilo/ Palawan
Palawan/ Cagayan
Routes with mild competition
Cagayan/ Tagbilaran
Cebu/ Bohol
Cebu/ Cagayan
Cebu/ Davao
Cebu/ Dumaguete
Cebu/ General Santos
Cebu/ Iloilo
Cebu/ Palawan
Cebu/ Zamboanga
Davao/ General Santos
Dumaguete/ Tagbilaran
General Santos/ Zamboanga
Iligan/ Tagbilaran
Iloilo/ Davao
Iloilo/ General Santos
Iloilo/ Iligan
Manila/ Bacolod
CargoRevenue
8,601,481.06
21,574,856.26
1,581,070.00
1,252,909.07
1,003,866.20
66,776,308.80
21,921,461.37
4,541,445.21
2,633,327.87
25,320.49
1,124,401.58
939,943.65
75,464,446.24
154,237,641.74
41,199,217.31
28,219,026.84
11,164,007.84
3,773,296.70
36,241,689.67
1,060,800.89
1,464,389.78
3,201,282.49
3,067,418.09
10,225,379.99
8,357,274.35
3,387,507.92
347,282,893.07
HerfindahlIndex(HHI)
0.56
0.54
0.50
0.89
0.73
0.80
0.77
0.89
0.99
0.96
0.54
0.28
0.46
0.54
0.56
0.37
0.27
0.31
0.39
0.67
0.39
0.34
0.58
0.48
0.46
0.43
0.50
Numberof
Operators
2
2
2
2
3
9
6
3
2
2
3
8
1 0
9
1 5
9
1 5
5
1 2
4
4
7
4
3
4
9
5
Philippine Domestic Shipping Transport Industry
70
WG&A, Sulpicio Lines, Solid
Shipping Lines, Lorenzo
Shipping Corp
WG&A, Sulpicio Lines
WG&A, Sulpicio Lines
Solid Shipping Corp
WG&A, Solid Shipping Lines,
Lorenzo Shipping Corp
WG&A, Sulpicio Lines
WG&A, Negros Navigation, Lorenzo
Shipping Corp, Sulpicio Lines
Negros Navigation, WG&A
WG&A, Negros Navigation
Sulpicio Lines, WG&A, Lorenzo
Shipping Corp
Appendix Table 4. ContinuedEffective Competitors
Number=1/HHI
3.82
2.61
3.17
1.45
2.73
1.86
3.62
1.55
2.17
2.93
Name of Operator/s Share
94.8
86.0
69.5
83.0
95.7
88.6
99.8
59.0
85.3
98.7
Route
Manila/ Cagayan
Manila/ Cebu
Manila/ Davao
Manila/ Dumaguete
Manila/ General Santos
Manila/ Iligan
Manila/ Iloilo
Manila/ Palawan
Manila/ Tagbilaran
Manila/ Zamboanga
CargoRevenue
711,473,013.28
1,004,747,524.76
678,986,652.52
428,166,781.64
518,799,626.22
87,277,223.44
40,950.00
127,482,600.03
63,169,311.82
411,264,594.59
HerfindahlIndex(HHI)
0.26
0.38
0.32
0.69
0.37
0.54
0.28
0.65
0.46
0.34
Numberof
Operators
6
4
4
5
6
4
7
5
3
4
Source: 1998 Annual Traffic Reports of Shipping Companies submitted to the MARINA.
71
Appendixes
Shipshape Ferry
Sulpicio Lines
Triton Shipping Corp
George and Peter Lines
Cokaliong Shipping Lines
Sulpicio Lines
Ocean Express Shipping Corp
San Nicolas Lines
Sulpicio Lines
Sulpicio Lines
San Nicolas Lines
Sulpicio Lines
Cebu Ferries Corp
Sulpicio Lines
Sulpicio Lines
Adelia Membreve
Age Shipping Lines, VG
Shipping Lines
WG&A, Sulpicio Lines
WG&A, Sulpicio Lines, Lorenzo
Shipping Corp
Negros Navigation, WG&A
Sulpicio Lines, WG&A
Water Jet Shipping Corp,
Sulpicio Lines
Cebu Ferries Corporation
FJP Lines
George and Peter Lines
Phil Fast Ferry Corp
Cebu Ferries Corporation
MY Lines Inc
Cebu Ferries Corporation
Sulpicio Lines Inc
Negros Navigation
Appendix Table 5. Dominant/effective players per route per type of market, cargo revenue,secondary routes, 1998
Effective CompetitorsNumber=
1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.61
1.63
2.88
1.94
1.81
1.67
1.14
1.04
1.26
1.30
1.13
1.18
1.05
1.11
1.02
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
93.8
95.7
88.7
87.2
93.8
91.7
97.4
94.6
98.9
Route
Routes with only 1 operator
Batangas/ Romblon
Cotabato/ Estancia
Dapitan/ Tagbilaran
Dapitan/ Zamboanga
Dumaguete/ Maasin
Manila/ Baybay
Manila/ Cebu/ Bacolod
Manila/ Coron
Manila/ Maasin
Manila/ Palompon
Manila/ Tilik
Masbate/ Baybay
Palawan/ Tacloban
Surigao/ Baybay
Surigao/ Masbate
Ubay/ Maasin (Leyte)
Routes with at least 2 operators
Routes with substantial competition
Cebu/ Talibon
Manila/ Butuan
Manila/ Cotabato
Manila/ Roxas
Manila/ Surigao
Surigao/ Maasin
Routes with only 1 effective competitor
Cagayan/ Tacloban
Cebu/ Calbayog
Cebu/ Dapitan
Cebu/ Ormoc
Cebu/ Ozamis
Cebu/ Palompon
Cebu/ Tacloban
Dumaguete/ Ozamis
Iloilo/ Ozamis
CargoRevenue
78,350.00
22,434.02
147,632.51
627,914.64
22,104.30
866,733.60
121,180.00
16,351,889.42
675,801.52
4,460,893.86
6,032,910.14
5,313.57
6,249.09
87,843.63
2,698.01
2,440.00
3,841,071.00
138,164,503.77
178,602,482.64
51,427,590.30
21,212,430.20
128,739.98
3,091,078.38
2,977,751.60
6,634,164.37
115,271,400.59
35,972,196.03
608,053.68
56,340,849.08
4,023,557.76
1,153,112.90
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
0.62
0.61
0.35
0.51
0.55
0.60
0.88
0.96
0.80
0.77
0.88
0.84
0.95
0.90
0.98
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2
2
3
2
2
2
3
2
3
7
3
3
9
3
2
72
Philippine Domestic Shipping Transport Industry
Angelina Balansag, Santos Cruz
Negros Navigation, Lilygene
Shipping Lines
Cebu Ferries Corp, Sulpicio Lines
Cokaliong Lines, Sulpicio Lines
Cokaliong Lines, Sulpicio Lines
WG&A, Sulpicio Lines
Hosanna Shipping, Mintrade
Shipping Lines
George and Peter Lines
Teng Tick Hua, Magnolia Shipping
Corp, WG&A
Negros Navigation, West Visayas
Shipping Co., WG&A
WG&A, Sulpicio Lines, Lorenzo
Shipping Corp
WG&A Phil. Inc, Sulpicio Lines
WG&A Phil. Inc, Negros Navigation
WG&A Phil. Inc, Sulpicio Lines
Domingo Paredes
Appendix Table 5. ContinuedEffective Competitors
Number=1/HHI
1.61
2.35
2.16
2.11
1.90
2.15
1.93
1.47
2.86
3.59
2.58
2.01
2.14
2.00
1.55
Name of Operator/s Share
96.5
81.0
96.2
97.3
92.5
94.4
92.4
79.9
99.8
67.3
100.0
99.7
87.0
99.8
77.1
Route
Routes with mild competition
Bohol (Ubay)/ Leyte (Maasin or Bato)
Cebu/ Bacolod
Cebu/ Butuan
Cebu/ Dipolog
Cebu/ Surigao
Cotabato/ Zamboanga
Davao/ Surigao
Dumaguete/ Dapitan
Iligan/ Ozamis
Iloilo/ Bacolod
Iloilo/ Cotabato
Manila/ Ormoc
Manila/ Ozamis
Manila/ Tacloban
Surigao/ del Carmen
CargoRevenue
253,013.00
9,467,232.84
61,216,008.94
5,467,990.76
9,075,612.38
8,216,667.17
1,073,524.86
2,073,705.07
111,672.08
21,608,455.42
8,800,336.99
27,828,093.48
110,356,039.06
110,425,202.20
8,162.00
HerfindahlIndex(HHI)
0.62
0.43
0.46
0.47
0.53
0.46
0.52
0.68
0.35
0.28
0.39
0.50
0.47
0.50
0.65
Numberof
Operators
3
9
6
4
8
4
3
2
4
1 0
3
3
3
3
2
Source: 1998 Annual Traffic Reports of Shipping Companies submitted to the MARINA.
73
Appendixes
Timoteo Batton
ZDS-ATOM FSA
Lite Shipping Corporation
Conrado Geraldoy
Seaford Shipping Lines
Lite Shipping Corporation
William Michael Shipping Corp.
V- Lines
Palacio Shipping Inc.
Gerardo Gubo
Lite Shipping Corporation
Hadji Sab Tiri Jalali
Negros Navigation Company
Palacio Shipping Inc.
Seaford Shipping Lines
Negros Navigation Company
Rover Shipping Services
William Michael Shipping Corp.
Felicito Geraldoy
V- Lines
Inter-Island Maritime Corporation
Sto Nino Ferry Boat Services
Analyn Cordero
Via Marine Corporation
Terban Marine Corporation
William Michael Shipping Corp.
La Felicidad Marine Corporation
La Felicidad Marine Corporation
Terban Marine Corporation
Terban Marine Corporation
La Felicidad Marine Corporation
Terban Marine Corporation
La Felicidad Marine Corporation
Via Marine Corporation
La Felicidad Marine Corporation
William Michael Shipping Corp.
Via Marine Corporation
Super Diamond Shipping Lines, Inc
Via Marine Corporation
Via Marine Corporation
Appendix Table 6. Dominant/effective players per route per type of market, cargo revenue,tertiary routes, 1998
Effective CompetitorsNumber=
1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Routes with only 1 operator
Adecar/ Panabo
Alicia (Guicam) / Mabuhay (Hulahula)
Argao/ Loon
Bacolod/ Bais
Bacolod/ Bataan
Bacolod/ Butuan
Bacolod/ Del Pan
Bacolod/ Dipolog
Bacolod/ Dumaguete
Bacolod/ Guimaras
Bacolod/ Hilongos
Bacolod/ Languyan
Bacolod/ Legaspi
Bacolod/ Leyte (Isabel)
Bacolod/ Mindoro (Sablayan)
Bacolod/ Palawan
Bacolod/ Pasacao
Bacolod/ Pasig
Bacolod/ San Jose
Bacolod/ Sta Catalina
Bacolod/ Toledo
Bantayan/ Cadiz
Bantayan/ Roxas
Batangas (PSPC) / Batangas (CTX)
Batangas (Shell)/ Batangas (Caltex)
Batangas/ Amlan
Batangas/ Cimlong (BTGS)
Batangas/ CTX Shell (Pandacan)
Batangas/ Currimao
Batangas/ Dadiangas
Batangas/ Ludo
Batangas/ Mabini
Batangas/ Maricalum (Bulata)
Batangas/ Masbate
Batangas/ Naga (Apocemco)
Batangas/ Negros
Batangas/ Pagbilao
Batangas/ Puerto Galera
Batangas/ Quezon (Mauban)
Batangas/ Sabah
CargoRevenue
393,000.00
147,965.51
3,141,004.00
8,000.00
80,406.00
31,605.00
206,896.20
30,000.00
186,474.38
143,500.00
39,200.00
351,231.00
676.00
1,279,028.10
82,272.00
1,555,951.00
64,000.00
257,457.60
20,000.00
27,000.00
240,000.00
340,711.00
20,000.00
365,891.10
487,132.43
108,775.00
217,690.54
328,603.88
8,499,865.64
2,475,452.22
586,708.47
155,268.72
534,714.98
1,504,926.77
1,920,341.98
249,602.50
416,787.27
416,787.27
365,455.99
712,116.80
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
74
Philippine Domestic Shipping Transport Industry
Cesar Datinguinod
Via Marine Corporation
William Michael Shipping Corp.
Sulpicio Lines Inc.
Jones Carrier
Sofronio Bogtai
Sofronio Bogtai
Sofronio Bogtai
Antonieto Pedericos
Sofronio Bogtai
Ocean Express Shipping Corp
William Michael Shipping Corp.
Casiano Obligado Jr
Lite Shipping Corporation
Lite Shipping Corporation
Lite Shipping Corporation
Lite Shipping Corporation
Via Marine Corporation
Via Marine Corporation
Via Marine Corporation
Via Marine Corporation
Via Marine Corporation
Via Marine Corporation
Ocean Express Shipping Corp
Ocean Express Shipping Corp
Lite Shipping Corporation
Lite Shipping Corporation
Cebu Ferries Corporation
Jones Carrier
Lite Shipping Corporation
Cebu Ferries Corporation
Lite Shipping Corporation
Jones Carrier
Lite Shipping Corporation
Sulpicio Lines Inc.
Ever Lines Inc.
V- Lines
Rover Shipping Services
Ocean Express Shipping Corp
Sulpicio Lines Inc.
Triton Shipping Corporation
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Batangas/ Sabang
Batangas/ Sta. Ana
Batangas/ Tolong
Baybay/ Calubian
Baybay/ Gingoog
Baybay/ Kawit
Baybay/ Moabog
Baybay/ Monserrat
Baybay/ Pilar Camotes
Baybay/ San Juan
Bislig/ Davao/ Jolo
Bislig/ Picop
Bohol (Pres. Carlos P. Garcia) /
Mandaue (Looc)
Bohol (Ubay)/ Legaspi
Bohol (Ubay)/ Sablayan
Bohol (Ubay)/ San Fernando
Bohol (Ubay)/ Talibon
BRC/ Navotas
BRC/ NPC CIP Cebu
BRC/ NPC Naga
BRC/ Pandacan
BRC/ Poro
BRC/ Rosario
Butuan/ Batangas
Butuan/ Bislig
Butuan/ Hilongos
Butuan/ Hinunangan
Butuan/ Ozamis
Butuan/ San Fernando
Butuan/ Sorsogon
Butuan/ Tacloban
Butuan/ Zamboanga
Cagayan de Oro/ Bantayan
Cagayan de Oro/ Catbalogan
Cagayan de Oro/ Dadiangas
Cagayan de Oro/ Mindoro
Cagayan de Oro/ Mindoro (San Jose)
Cagayan de Oro/ Ozamis
Cagayan de Oro/ Pasacao
Cagayan de Oro/ Polloc
Cagayan de Oro/ Pulupandan
CargoRevenue
61,000.00
628,485.82
244,461.00
185.45
135,386.25
4,945.00
4,270.00
3,400.00
79,969.00
3,530.00
126,700.00
385,127.04
4,110.00
98,700.00
114,125.00
92,825.00
14,400.00
4,264,791.11
522,824.01
538,490.55
20,537,504.29
1,227,651.78
5,632,988.58
119,000.00
249,600.00
40,792.00
26,000.00
6,767.04
595,000.00
52,000.00
142,503.27
26,000.00
244,581.46
24,310.00
171,360.00
54,000.00
25,500.00
64,000.00
128,640.00
98,640.00
238,800.00
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
75
Appendixes
Ever Lines Inc.
Lite Shipping Corporation
Inter-Island Maritime Corporation
Efren & Thelma Bungalso
Oscar Gerdiano
Arturo Olasiman
Arturo Olasiman
Arturo Olasiman
Arturo Olasiman
Teresita Koga
Gomez Brothers Shipping Lines
Margarito Tan
Iluminado Dacullos
Armando Sarayan
Agustin Romano
Agustin Romano
Manuel Estrada
Emilio Morate
Florencio Apacible
V- Lines
Armando Sarayan
Armando Sarayan
Florencio Apacible
Agustin Romano
Reynaldo Cajefe
Dionisio Montalban
Agustin Romano
Lite Shipping Corporation
Antonio Vencio
William Michael Shipping Corp.
Eastern Pacific Lines
Lapu-Lapu Shipping Lines
Ocean Express Shipping Corp
Aquilina Guro
Wilson C. Rabanos
Lilygene Shipping Lines
Torcuato Bahian
Efren & Thelma Bungalso
Sultan Shipping
Torcuato Bahian
Torcuato Bahian
Cebu Ferries Corporation
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Cagayan de Oro/ San Carlos
Cagayan de Oro/ San Jose
Cagayan de Oro/ Toledo
Cagayan de Orocillo/ Puerto Prinsesa
Cagbalete/ Mauban
Calbayog/ Guinabarocan
Calbayog/ Labangbaybay
Calbayog/ Mataloto
Calbayog/ Poblacion
Calbayog/ Tagpulaan
Carbon/ Inabangan
Catbalogan/ Borongan
Catbalogan/ Buenavista
Catbalogan/ Buluan
Catbalogan/ Canhawan
Catbalogan/ Cinco
Catbalogan/ Daram
Catbalogan/ Guintarean
Catbalogan/ Jocopon
Catbalogan/ Leyte (Isabel)
Catbalogan/ Mombon
Catbalogan/ Rama
Catbalogan/ Real/ Haplayan
Catbalogan/ Samar
Catbalogan/ San Roque
Catbalogan/ Saugan
Catbalogan/ Sitio Bitoon
Catbalogan/ Sogod
Catbalogan/ Tarangnan
Cebu/ Bago
Cebu/ Bantayan
Cebu/ Bantilan
Cebu/ Bataan
Cebu/ Bauan
Cebu/ Bilangbilangan East & West
Cebu/ Borongan
Cebu/ Bulan
Cebu/ Cagayan de Orocillo
Cebu/ Calbayog/ Guiwan
Cebu/ Camiguin
Cebu/ Cataingan
Cebu/ Cebu
CargoRevenue
56,000.00
52,000.00
154,000.00
57,000.00
28,087.50
760.00
37,207.00
1,305.00
480.00
56,472.00
91,321.00
123,910.00
9,799.00
41,248.00
6,721.00
24,041.00
23,040.00
35,750.00
152,507.00
42,000.00
33,100.00
64,200.00
5,405.00
4,398.00
82,020.00
69,616.00
25,584.00
26,000.00
3,320.00
11,786.00
50,000.00
1,733,688.67
185,000.00
482,812.50
427,018.35
95,000.00
80,000.00
23,000.00
350,000.00
40,000.00
60,000.00
365,123.60
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
76
Philippine Domestic Shipping Transport Industry
Sun Lines
Torcuato Bahian
Sultan Shipping
Sultan Shipping
Carmelo T. Simolde
George and Peter Lines
Palacio Shipping Inc.
George and Peter Lines
Torcuato Bahian
Eduardo Jarque
Sultan Shipping
Eduardo Jarque
George and Peter Lines
Sulpicio Lines Inc.
Teng Tick Hua
Ever Lines Inc.
Eduardo Jarque
Lite Shipping Corporation
FJP Lines
Sulpicio Lines Inc.
Cebu Ferries Corporation
Felicito Geraldoy
Virgilio Arbolado
Virgilio Arbolado
Carlito Latonio
Sofronio Bogtai
Sofronio Bogtai
George and Peter Lines
Galactic Shipping Inc.
Terban Marine Corporation
Ocean Express Shipping Corp
Galactic Shipping Inc.
Sulpicio Lines Inc.
Sulpicio Lines Inc.
Galactic Shipping Inc.
Conrado Geraldoy
Galactic Shipping Inc.
Hosanna Shipping
Sulpicio Lines Inc.
Terban Marine Corporation
Cebu Ferries Corporation
Cebu Ferries Corporation
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Cebu/ Cotabato/ Zamboanga
Cebu/ Guiuan
Cebu/ Iloilo/ Legaspi
Cebu/ Iloilo/ Pasacao
Cebu/ Jetafe
Cebu/ Kiwalan
Cebu/ Larena
Cebu/ Lazi
Cebu/ Liloy
Cebu/ Magallanes
Cebu/ Mindoro/Tagbilaran
Cebu/ Nabilid
Cebu/ Oroquietta
Cebu/ Polloc
Cebu/ Pulupandan/ Ozamis
Cebu/ San Carlos
Cebu/ San Fernando
Cebu/ San Jose
Cebu/ Sta Fe
Cotabato/ Dadiangas
Cotabato/ Davao
Cotabato/ Roxas City
Cuyo/ El Nido
Cuyo/ San Vicente
Danao/ Consuelo, Camotes
Danao/ Kawit
Danao/ Moabog
Dapitan/ Lazi
Davao/ Basilan
Davao/ Batangas
Davao/ Bislig
Davao/ Bungao
Davao/ Dadiangas
Davao/ Dipolog
Davao/ Escalante
Davao/ Guimaras
Davao/ Jolo
Davao/ Legaspi
Davao/ Masbate
Davao/ Nonoc
Davao/ Ormoc
Davao/ Ozamis
CargoRevenue
55,007.90
60,000.00
100,000.00
124,000.00
80,129.00
26,307.55
1,536,462.12
638,884.67
65,000.00
178,960.50
80,000.00
49,454.70
258,631.10
425,729.40
111,142.00
48,000.00
84,000.00
227,122.00
2,538,314.98
1,994.15
67,192.74
40,000.00
2,249.40
10,150.45
231,340.00
5,960.00
6,045.00
114,977.13
49,880.00
4,118,617.56
111,275.00
186,792.33
54,513.67
22,382.12
92,334.83
3,000.00
151,492.92
586,720.00
99,037.92
2,001,815.45
98,672.39
42,045.16
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
77
Appendixes
Triton Shipping Corporation
Cebu Ferries Corporation
Sulpicio Lines Inc.
William Michael Shipping Corp.
Jones Carrier
Lite Shipping Corporation
Lite Shipping Corporation
Lite Shipping Corporation
Magnolia Shipping Corporation
Magnolia Shipping Corporation
Gaudencio Baruc
Gaudencio Baruc
Triton Shipping Corporation
Jones Carrier
George and Peter Lines
George and Peter Lines
Palacio Shipping Inc.
George and Peter Lines
Cebu Ferries Corporation
Sulpicio Lines Inc.
George and Peter Lines
Felicito Geraldoy
Inter-Island Maritime Corporation
V- Lines
George and Peter Lines
Milton Ian
Uni-Orient Pearl Ventures Inc.
William, Gothong & Aboitiz, Inc.
Eugenio Chan
Galactic Shipping Inc.
William, Gothong & Aboitiz, Inc.
Gerardo Gubo
Gerardo Gubo
Nomn Novyar
Gerardo Gubo
Leonardo Dauhog
Leonardo Dauhog
Leonardo Dauhog
Leonardo Dauhog
Galactic Shipping Inc.
William Michael Shipping Corp.
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Davao/ Pulupandan
Davao/ Tacloban
Davao/ Tagbilaran
Dipolog/ Dumaguete/ Cebu
Dipolog/ Gingoog
Dipolog/ Liloan
Dipolog/ Ozamis
Dipolog/ San Jose
Dipolog/Davao/Tacloban
Dipolog/Zamboanga/Pagadian
Doong/ Hagnaya
Doong/ Vito
Dumaguete/ Bataan
Dumaguete/ Gingoog
Dumaguete/ Kiwalan
Dumaguete/ Lapu-Lapu
Dumaguete/ Larena
Dumaguete/ Lazi
Dumaguete/ Ormoc
Dumaguete/ Polloc
Dumaguete/ Siom
Dumaguete/ Tandag
Dumaguete/ Toledo
Escalante/ Pulupandan
Ferna/ Oroq
Gasan, Marinduque/ Pinamalayan,
Or Mindoro
General Santos/ Leyte (Isabel)
General Santos/ Masbate
General Santos/ Mavias
General Santos/ Pagadian
General Santos/ Puerto Princesa
Guimaras/ Kalibo
Guimaras/ Masbate
Guimaras/ Roxas City
Guimaras/ Victorias
Hingatungan/ Bacagay
Hingatungan/ Kikilo
Hingatungan/ San Francisco
Hingatungan/ Tib-o
Iligan/ Basilan
Iligan/ Batangas
CargoRevenue
90,000.00
399,429.64
10,057.93
393,766.24
234,651.00
24,310.00
26,000.00
26,000.00
61,492.10
31,042.80
6,440.00
2,850.00
284,173.68
50,331.90
57,821.00
92,523.55
1,425,616.52
1,696.75
48,922.36
4,941.06
228,355.45
45,000.00
70,000.00
42,000.00
204,416.10
7,085.06
172,000.00
32,748.96
466,059.87
38,531.50
41,885.45
12,000.00
28,750.00
10,200.00
269,600.00
1,600.00
2,500.00
900.00
8,000.00
35,566.50
319,500.00
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
78
Philippine Domestic Shipping Transport Industry
William Michael Shipping Corp.
William Michael Shipping Corp.
William Michael Shipping Corp.
Sulpicio Lines Inc.
Sulpicio Lines Inc.
William Michael Shipping Corp.
William Michael Shipping Corp.
George and Peter Lines
Hosanna Shipping
William Michael Shipping Corp.
William Michael Shipping Corp.
William Michael Shipping Corp.
William Michael Shipping Corp.
William Michael Shipping Corp.
William Michael Shipping Corp.
Hosanna Shipping
William Michael Shipping Corp.
William Michael Shipping Corp.
Magnolia Shipping Corporation
Sulpicio Lines Inc.
Cebu Ferries Corporation
Ever Lines Inc.
Felicito Geraldoy
Sulpicio Lines Inc.
Jones Carrier
HBT Shipping Corp.
Felicito Geraldoy
Lite Shipping Corporation
Hadji Sab Tiri Jalali
Antonio Mogasa
Jones Carrier
V- Lines
HBT Shipping Corp.
Jones Carrier
Lite Shipping Corporation
Danilo Lampadero
William Michael Shipping Corp.
Lite Shipping Corporation
Jones Carrier
Sulpicio Lines Inc.
Lite Shipping Corporation
Lite Shipping Corporation
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Iligan/ Cebu/ Amlan
Iligan/ Cebu/ Pasar
Iligan/ Davao/ Malalag
Iligan/ Dipolog
Iligan/ Dipolog
Iligan/ Dipolog/ Davao
Iligan/ Iloilo/ Amlan/ Picop
Iligan/ Lazi
Iligan/ Legaspi
Iligan/ Ormoc/ Cebu
Iligan/ Ormoc/ Leyte
Iligan/ Pasacao/ Cebu
Iligan/ Pasar/ Cebu
Iligan/ Picop/ Cebu
Iligan/ Picop/ Davao
Iligan/ San Jose
Iligan/ Sulu
Iligan/ Zamboanga/ Davao
Iligan/Zamboanga/Dipolog
Iloilo (Estancia)/ Cotabato
Iloilo/ Aklan
Iloilo/ Catarman
Iloilo/ Contillon
Iloilo/ Dadiangas
Iloilo/ Danao Escalante
Iloilo/ Escalante
Iloilo/ Galo
Iloilo/ Jetafi
Iloilo/ Lamitan
Iloilo/ Magalona
Iloilo/ Mariveles
Iloilo/ Ormoc
Iloilo/ Pulupandan
Iloilo/ Subic
Iloilo/ Tagbilaran
Iloilo/ Victorias City
Ipil/ Ormoc/ Iligan
Jagna/ Bohol (Ubay)
Jagna/ Gingoog
Jagna/ Nasipit
Jagna/ PKS
Jagna/ Sablayan
CargoRevenue
109,480.21
25,844.00
78,810.00
258,190.63
14,052.67
210,071.20
109,580.62
118,225.33
770,550.00
28,968.00
246,642.78
58,575.00
51,688.00
110,180.95
183,787.16
297,879.87
7,356,551.92
108,657.18
26,431.50
901,101.23
15,945.23
140,000.00
35,000.00
4,949,209.88
88,470.91
77,695.45
10,000.00
24,500.00
217,068.00
19,900.00
269,306.61
35,750.00
123,354.55
333,563.64
119,393.00
298,851.00
196,068.33
88,125.00
81,094.30
5,630.17
88,125.00
176,250.00
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
79
Appendixes
Lite Shipping Corporation
Lite Shipping Corporation
Lite Shipping Corporation
Den Tadus
Celeste Temperatura
Inter-Island Maritime Corporation
Saturnino Atienza
Inter-Island Maritime Corporation
Triton Shipping Corporation
Palacio Shipping Inc.
Triton Shipping Corporation
V- Lines
Galactic Shipping Inc.
Galactic Shipping Inc.
Inter-Island Maritime Corporation
Ever Lines Inc.
Zenaida Petracorta
Lite Shipping Corporation
Ever Lines Inc.
Magnolia Shipping Corporation
Jones Carrier
Jones Carrier
Jones Carrier
Lina C. Echin
Jones Carrier
Juana Lopez
Philip Go
William, Gothong & Aboitiz, Inc.
Hosanna Shipping
Sulpicio Lines Inc.
Seaford Shipping Lines
Magnolia Shipping Corporation
William Michael Shipping Corp.
San Nicolas Lines Inc.
Amparo Shipping Corp.
Sulpicio Lines Inc.
Sulpicio Lines Inc.
Magnolia Shipping Corporation
Ever Lines Inc.
Ever Lines Inc.
Julian Grimaldo
Arturo Susas
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Jetafi/ Bais
Jetafi/ Bohol (Ubay)
Jetafi/ Legaspi
Jolo/ Basilan
Kaputian/ Sta Ana
Kawit/ Legros
Kawit/ Madredejos
Leyte (Isabel)/ Batangas
Leyte (Isabel)/ Dapitan
Leyte (Isabel)/ Pasacao
Leyte (Isabel)/ Pulupandan
Leyte (Isabel)/ Roxas
Leyte/ Ozamis
Leyte/ Pagadian
Leyte/ Toledo
Leyte/ Zamboanga
Limasawa/ Burgos
Loon/ Talibon
Malangas/ Margos
Malangas/ Subanipa
Mandaue/ Basilan
Mandaue/ Calbayog
Mandaue/ Catanduanes
Mandaue/ Masbate
Mandaue/ Masbate
Mandaue/ Samar
Mandaue/ Zamboanga
Manila/ Aklan
Manila/ Bais
Manila/ Calubian
Manila/ Danao Escalante
Manila/ Iligan/ Margosatubig
Manila/ Iligan/ Siom
Manila/ Liminancong
Manila/ Palawan/ Lucena/ Surigao
Manila/ Polloc
Manila/ Pulupandan
Manila/ Toledo
Margos/ Subanipa
Margos/ Talusan
Marinduque/ Quezon
Masbate/ Maya
CargoRevenue
30,018.00
88,125.00
85,125.00
25,322.00
1,069.00
70,000.00
167,740.00
180,000.00
90,400.00
1,096,128.57
145,267.00
30,575.00
40,950.00
140,585.20
90,000.00
56,000.00
50,700.00
27,000.00
30,991.21
1,900.80
1,453,146.41
86,053.51
116,869.29
346,750.00
618,593.85
4,168.00
70,000.00
4,186,374.02
4,186,374.02
71,424.14
1,311,000.00
86,073.20
238,497.83
5,905,085.78
199,663.65
19,590.50
8,581,533.99
81,426.90
102,671.15
35,592.00
28,087.50
8,785.00
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
80
Philippine Domestic Shipping Transport Industry
Sulpicio Lines Inc.
San Nicolas Lines Inc.
Palacio Shipping Inc.
San Nicolas Lines Inc.
San Nicolas Lines Inc.
Jones Carrier
Cesar Sitjar
Teodolo Lapure
Teodolo Lapure
Teodolo Lapure
Cesar Sitjar
Teodolo Lapure
Teodolo Lapure
Teodolo Lapure
MY Lines, Inc.
Teodolo Lapure
Teodolo Lapure
Teodolo Lapure
William Michael Shipping Corp.
Terban Marine Corporation
Manuel Perez
Philippine Fast Ferry Corporation
Sofronio Bogtai
Triton Shipping Corporation
Cebu Ferries Corporation
Sofronio Bogtai
Sofronio Bogtai
Inter-Island Maritime Corporation
Lina C. Echin
Sofronio Bogtai
Sofronio Bogtai
Antonieto Pedericos
RP Tamula and Sons
RP Tamula and Sons
Magnolia Shipping Corporation
Magnolia Shipping Corporation
Ocean Express Shipping Corp
Sulpicio Lines Inc.
William, Gothong & Aboitiz, Inc.
Emma Maglente
Vito Coronacion
William, Gothong & Aboitiz, Inc.
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Masbate/ Zamboanga
Mindoro/ Burunga
Mindoro/ Leyte (Isabel)
Mindoro/ Libertad
Mindoro/ Semerara
Naga/ Maasin
Naval/ Bato
Naval/ Binamalayan
Naval/ Burabod
Naval/ Calvani
Naval/ Canduhao
Naval/ Casibang
Naval/ Hagonoy
Naval/ Maripiri
Naval/ Palompon
Naval/ Trabugan
Naval/ Ulog
Naval/ Viga
Negros/ Pasig
Nonoc/ Lapu-lapu
Odiongan/ Oangay
Ormoc/ Camotes
Ormoc/ Dapdap
Ormoc/ Dapitan
Ormoc/ General Santos
Ormoc/ Kawit
Ormoc/ Lanao
Ormoc/ Leyte (Isabel)
Ormoc/ Mandaue
Ormoc/ Moabog
Ormoc/ Monserrat
Ormoc/ Pilar Camotes
Ozamis/ Kolambugan
Ozamis/ Tubod
Ozamis/Zamboanga/Dipolog
Pagadian/Toledo/Zamboanga
Palawan/ Basilan
Palawan/ Dipolog
Palawan/ Masbate
Palawan/ Mindoro
Palawan/ Occi Mindoro
Palawan/ Puerto Princesa
CargoRevenue
64,650.32
547,108.00
613,536.15
1,786,875.00
1,138,966.00
47,727.21
14,700.00
1,123.00
1,562.00
2,040.00
257,000.00
2,029.00
4,440.00
4,393.00
1,642.85
1,415.00
2,270.00
2,025.00
243,105.00
5,094,650.56
30,100.00
329,740.00
14,830.00
156,286.58
7,003.76
5,320.00
15,705.00
110,000.00
201,200.00
17,400.00
6,190.00
291,090.50
2,916.28
4,361.78
24,968.10
44,427.20
343,300.00
24,487.10
77,863.50
9,200.00
111,218.00
33,600.01
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
81
Appendixes
Marlo Calumbayan
Franco Mabigat
Ocean Express Shipping Corp
Pearl Farm Beach Resort
Eustaquio Caringal
Terban Marine Corporation
Patrocinio Cuaca
Teng Tick Hua
Rolando Liwanag
Eulogo & Celia Mazo
Teodolo Mindoro
Teodolo Mindoro
Victoriano Lo
Rodolfo Gabalonzo
Rodolfo Gabalonzo
Liwanag Mendoza
Lite Shipping Corporation
Magnolia Shipping Corporation
Ever Lines Inc.
Negros Navigation Company
Danilo Lines
San Nicolas Lines Inc.
Lite Shipping Corporation
Lite Shipping Corporation
Lilia Flores
Asman Jaide
Roger Bandao
Martino Palacio
Joel Bustamante
Joel Bustamante
Celeste Temperatura
Jose Castro
Magnolia Shipping Corporation
William Michael Shipping Corp.
Via Marine Corporation
Via Marine Corporation
La Felicidad Marine Corporation
Hosanna Shipping
Honesto Lipao
Sulpicio Lines Inc.
Eduardo Jarque
Amparo Shipping Corp.
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Palawan/ Quezon
Palawan/ San Jose
Palawan/ Zamboanga
Pearl Farm/ Insular
Perez/ Atimonan
Pililia/ South Harbor
Placer/ Bogo
Puerto Princesa/ Pulupandan
Romblon/ Lucena
Romblon/ Roxas
Romblon/ San Agustin
Romblon/ Sibuyan
Romblon/Mangabong, Orr Mindoro
Roxas/ Bantayan
Roxas/ Negros Occidental
Sablayan/ Bauan
Sablayan/ San Jose
Sagasa/ Alicia
Sagasa/ Talusan
San Carlos/ Estancia
San Carlos/ Toledo
San Jose/ Antique
San Jose/ Bais
San Jose/ Talibon
San Juan/ Anilao
Siasi/ Sibutu, Tawi-tawi
Sta Ana/ Cogon
Sta Ana/ Kaputian
Sta Ana/ Mindanao
Sta Ana/ Pigasaan
Sta Cruz/ Tucanga
Sto Tomas/ Talaga
Subanipa/ Malangas
Subic/ Bislig
Subic/ Navotas
Subic/ Pandacan
Subic/Batangas/Legaspi
Surigao/ Aklan
Surigao/ Cagdianao
Surigao/ Calubian
Surigao/ Gingoog
Surigao/ Lucena
CargoRevenue
150,000.00
164,480.00
171,650.00
15,525.00
118,000.00
21,826,623.68
17,474.00
159,700.00
10,080.00
15,300.00
60,500.00
904,000.00
103,440.00
3,000.00
6,000.00
184,450.00
13,054.00
3,010.85
80,248.71
93,969.00
3,271,292.20
1,678,049.00
26,000.00
40,915.00
43,000.00
131,291.00
2,194.00
2,369.00
6696.45
60,998.60
1,419.00
30,000.00
1,961.70
454,689.30
353,786.45
544,635.01
2,605,207.00
136,363.64
47,533.00
260.84
166,883.85
3,263,398.14
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
82
Philippine Domestic Shipping Transport Industry
Lina C. Echin
Vicente Mejia
Jones Carrier
Lite Shipping Corporation
Domingo Paredes
Lite Shipping Corporation
Tabango Express
Pedro Felizarta
Pedro Felizarta
Pedro Felizarta
Joedina Gumagay
Rogelio Germones
Lite Shipping Corporation
Romulo Alvarino
Felix Delantar
Palacio Shipping Inc.
Seaford Shipping Lines
Lina C. Echin
Lite Shipping Corporation
Eduardo Jarque
Lite Shipping Corporation
Jones Carrier
Lite Shipping Corporation
Lite Shipping Corporation
Terban Marine Corporation
Lite Shipping Corporation
Sulpicio Lines Inc.
Cebu Ferries Corporation
Lite Shipping Corporation
Lite Shipping Corporation
V- Lines
Lite Shipping Corporation
Lite Shipping Corporation
William, Gothong & Aboitiz, Inc.
Lite Shipping Corporation
Jones Carrier
Lite Shipping Corporation
Felicito Geraldoy
Lite Shipping Corporation
Lite Shipping Corporation
ABC Liner
Magnolia Shipping Corporation
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Surigao/ Mandaue
Surigao/ Pinut-an
Surigao/ Roxas
Surigao/ San Jose
Surigao/ Talisay
Surigao/ Zamboanga
Tabango/ Bogo
Tab-ok/ Bacagay
Tab-ok/ San Roque
Tab-ok/ Sta Lucia
Tacloban/ Balangina
Tacloban/ Bolusao
Tacloban/ Catbalogan
Tacloban/ Giporlos
Tacloban/ Lawaan
Tacloban/ Leyte (Isabel)
Tacloban/ Lucena
Tacloban/ Mandaue
Tacloban/ Masbate
Tacloban/ Nabilid
Tacloban/ Ozamis
Tacloban/ Roxas
Tacloban/ Sablayan
Tacloban/ Sogod
Tagbilaran/ Batangas
Tagbilaran/ Bohol (Ubay)
Tagbilaran/ Dipolog
Tagbilaran/ General Santos
Tagbilaran/ Hinunangan
Tagbilaran/ Lapu-Lapu
Tagbilaran/ Leyte (Isabel)
Tagbilaran/ Liloan
Tagbilaran/ Loon
Tagbilaran/ Ozamis
Tagbilaran/ San Carlos
Tagbilaran/ San Fernando
Tagbilaran/ Talibon
Tagbilaran/ Tandag
Tagbilaran/ Zamboanga
Talibon/ Colorado
Talisay/ Tampi
Talusan/ Alicia
CargoRevenue
165,600.00
23,555.50
98,251.84
26,000.00
125,600.00
81,584.00
14,540.00
1,310.00
1,060.00
490.00
108,747.00
22,176.00
32,708.00
5,000.00
3,000.00
321,032.80
198,000.00
486,300.00
52,000.00
118,209.00
24,310.00
467,885.00
26,000.00
64,833.00
3,452,731.56
89,840.00
141,001.24
6,873.87
26,000.00
34,500.00
32,500.00
21,810.00
38,400.00
3,056.05
48,185.00
60,000.00
113,100.00
30,000.00
41,775.00
10,292.00
19,358.00
3,255.10
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
83
Magnolia Shipping Corporation
Magnolia Shipping Corporation
Maayo Shipping, Inc.
Maayo Shipping, Inc.
Maayo Shipping, Inc.
Maayo Shipping, Inc.
Jefren D. Pages
Reynaldo Baleno
Rodolfo Manalo
Inter-Island Maritime Corporation
Inter-Island Maritime Corporation
Inter-Island Maritime Corporation
Inter-Island Maritime Corporation
Den Tadus
Den Tadus
Magnolia Shipping Corporation
Lite Shipping Corporation
William Michael Shipping Corp.
Lite Shipping Corporation
Hadji Jalleh Jayyari
Sing Hock Chua Amik
Lite Shipping Corporation
Sampaguita Shipping Corp.
Sampaguita Shipping Corp.
William Michael Shipping Corp.
Sampaguita Shipping Corp.
Lite Shipping Corporation
Hadji Jalleh Jayyari
Terban Marine Corp, La Felicidad
Marine Corp
WG&A, Palacio Shipping Lines,
Negros Navigation
Philip Go, Lite Shipping Corp
Almyre Cortes, Santiago Regalado
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.78
2.60
1.98
1.98
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Talusan/ Sagasa
Talusan/ Zamboanga
Tampi, San Jose/ Ayungon,
Negros Oriental
Tampi, San Jose/ Bato, Samboan,
Cebu
Tampi, San Jose/ Lazi, Siquijor
Tampi, San Jose/ Tan-awan, Oslob,
Cebu
Tangil/ Dumanjug
Tinglay (Batangas)/ Mabini
Tinglay (Batangas)/ Pisa
Toledo/ Bohol
Toledo/ Naval (Tacloban)
Toledo/ Pasacao
Toledo/ Talibon
Zamboanga City/ Zamboanga
del Sur/Norte
Zamboanga del Sur/Norte/ Basilan
Zamboanga/ Alicia
Zamboanga/ Bais
Zamboanga/ Bislig
Zamboanga/ Bohol (Ubay)
Zamboanga/ Limaong
Zamboanga/ Malabang
Zamboanga/ San Jose
Zamboanga/ Sandakan
Zamboanga/ Siocon
Zamboanga/ Siom
Zamboanga/ Sirawai
Zamboanga/ Sogod
Zamboanga/ Tungawan
Routes with at least 2 operators
Routes with substantial competition
Bacolod/ Batangas
Bacolod/ General Santos
Bacolod/ Tagbilaran
Bataan/ (Dumanguit)
CargoRevenue
8,636.50
44,572.60
4,687.95
3,741,252.35
7,492.80
235,019.35
102,324.00
89,650.00
50,000.00
160,000.00
96,000.00
70,000.00
170,000.00
64,999.00
15,000.00
22,870.75
18,702.00
240,000.00
31,283.00
38,000.00
1,090,980.00
52,360.00
1,763,851.60
767,373.55
203,018.17
550,111.40
39,200.00
10,000.00
1,806,755.16
1,770,738.41
169,190.50
38,924.00
HerfindahlIndex(HHI)
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
1.00
0.56
0.39
0.50
0.50
Numberof
Operators
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2
3
2
2
Appendixes
Philippine Domestic Shipping Transport Industry
84
La Felicidad Marine Corp
Terban Marine Corp
La Felicidad Marine Corp
Terban Marine Corp
La Felicidad Marine Corp,
Terban Marine Corp
Terban Marine Corp, La Felicidad
Marine Corp
Sulpicio Lines, Cebu Ferries Corp
Ocean Express, Jones Carrier
Eastern Pacific Lines, Cebu Ferries
Corp, Lorenzo Shipping Corp,
Sulpicio Lines
Galactic Shipping, Cebu Ferries
Corp, Lorenzo Shipping Corp
Lite Shipping Corp, Conrado
Geraldoy
Cebu Ferries Corp, Phil Fast Ferry
Corp, Palacio Shipping Inc
Palacio Shipping Lines, Ever Lines,
Sultan Shipping
Sulpicio Lines, Lorenzo Shipping
Corp, Cebu Ferries Corp
Jose Pedida, Virgilio Arbolado
Francisco Alboroto, Dominga
Ligoyligoy, Aurelio Leong
Eduardo Jarque, Jones Carrier
Neva Quezon, Escolastico
Geonanga
Jose Pedida, Virgilio Arbolado
HBT Shipping Corp, Lorenzo
Shipping Corp
Miller Santiago, Michael Jude
Placencia
Ocean Express Shipping Corp,
Rover Shipping Lines
Celso Arboleda, Rodolfo
Gabalonzo
HBT Shipping Corp, V- Lines
Ocean Express Shipping Corp,
Ever Lines Inc
Aquilina Guro, V- Lines
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.91
1.83
1.99
1.71
1.98
1.64
3.56
1.22
1.76
1.99
2.78
2.85
1.78
2.65
1.87
1.88
1.92
2.00
1.69
1.95
1.89
1.89
1.90
1.79
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.00
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Route
Batangas/ Anibong
Batangas/ Aparri
Batangas/ Poro
Batangas/Masbate/Calapan
Butuan/ Jagna
Cagayan de Oro/ Bataan
Cagayan de Oro/ Davao
Cagayan de Oro/ General Santos
Cebu/ Bais
Cebu/ Batangas
Cebu/ Pasacao
Cotabato/ General Santos
Cuyo/ Roxas
Davao del Sur/ Gen Santos
Dipolog/ Jagna
Guimaras/ Negros Occidental
Iloilo/ Cuyo
Iloilo/ Dumaguete
Iloilo/ Masbate
Iloilo/ Pasacao
Iloilo/ Roxas
Iloilo/ San Jose, Mindoro
Manila/ Jolo
Masbate/ Bauan
CargoRevenue
4,281,575.98
11,986,524.64
52,335,700.49
1,524,746.53
1,252,878.38
192,159.45
206,142.15
222,078.37
47,833.00
327,000.00
364,281.50
75,844.10
19,607.59
152,124.10
927,410.25
193,974.75
25,542.56
171,092.91
100,196.00
242,000.00
41,150.00
160,007.27
402,000.00
167,910.00
HerfindahlIndex(HHI)
0.52
0.55
0.50
0.59
0.50
0.61
0.28
0.82
0.57
0.50
0.36
0.35
0.56
0.38
0.54
0.53
0.52
0.50
0.59
0.51
0.53
0.53
0.53
0.56
Numberof
Operators
2
2
2
2
2
2
4
3
2
2
3
3
2
3
2
2
2
2
2
2
2
2
2
2
Appendixes
85
Lina Riega, Cesar Borja
Eduardo Jarque, Jones Carrier
Leonardo Dauhog, Pedro Felizarta
V- Lines, Lite Shipping Corp
Inter-island Maritime Corp, Lite
Shipping Corp
Galactic Shipping, Magnolia
Shipping Lines
Joyalcyd Corp, Sing Hock Chua
Amik
Sampaguita Shipping Corp,
Magnolia Shipping Corp
Magnolia Shipping Lines,
Ever Lines
Magnolia Shipping Lines,
Ever Lines
Negros Navigation
WG&A Philippines
Phil Fast Ferry Corp
Terban Marine Corp
Terban Marine Corp
Eduardo Jargue
RP Tamula and Sons
Lite Shipping Corp
Cebu Ferries Corp
Cebu Ferries Corp
Lorenzo Shipping Corp
Avelino Arraz
Lapu-lapu Shipping Lines
Cokaliong Shipping Lines
BCT Shipping Lines
WG&A Philippines
Cebu Ferries Corp
Sulpicio Lines
Cebu Ferries Corp
Rolando Gamilong
Leonardo Dauhog
Cebu Ferries Corp
Roger Marcelo
Gerardo Gubo
Sampaguita Shipping Corp
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.69
1.91
1.62
1.80
2.00
1.87
1.77
2.00
1.73
1.82
1.20
1.35
1.02
1.08
1.24
1.20
1.04
1.03
1.29
1.08
1.27
1.03
1.12
1.31
1.19
1.31
1.15
1.03
1.36
1.29
1.33
1.03
1.30
1.36
1.16
Name of Operator/s Share
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
91.2
85.2
99.0
96.3
89.0
90.7
98.0
98.6
87.2
96.0
71.1
98.4
94.3
86.9
91.1
87.1
93.3
98.6
84.8
87.0
85.3
98.4
86.9
84.4
92.8
Route
Surigao/ Basilica
Surigao/ Dipolog
Tab-ok/ San Francisco
Tacloban/ Mindoro (San Jose)
Tagbilaran/ Toledo
Zamboanga/ Dipolog
Zamboanga/ Lamitan
Zamboanga/ Sitangkai
Zamboanga/ Subanipa
Zamboanga/ Talusan
Routes with only 1 effective competitor
Bacolod/ Cagayan de Oro
Bacolod/ Zamboanga
Batangas/ Calapan
Batangas/ Pasacao
Batangas/Calapan/Pasacao
Baybay/ Dipolog
Benoni/ Balingoan
Cagayan de Oro/ Butuan
Cagayan de Oro/ Cotabato
Cagayan de Oro/ Ormoc
Cagayan de Oro/ Zamboanga
Catbalogan/ Villareal
Cebu/ Catbalogan
Cebu/ Maasin
Cebu/ Tandag
Dumaguete/ Cagayan de Oro
Dumaguete/ Cotabato
Dumaguete/ Dadiangas
Dumaguete/ General Santos
Guimaras/ Pulupandan
Hingatungan/ Tab-ok
Iligan/ Ormoc
Iloilo (Gigante Norte)/ Iloilo(Estancia)
Iloilo/ Bantayan
Jolo/ Bongao
CargoRevenue
150,715.00
1,770,229.22
16,241.30
78,500.00
137,500.00
77,834.90
246,540.19
781,615.70
354,474.61
62,399.61
19,220,657.32
1,607,320.06
187,665,518.13
4,435,253.24
2,060,381.83
1,113,681.86
1,419,177.25
26,369.56
2,384,611.52
1,272,943.29
483,206.18
322,025.00
1,768,496.58
2,337,195.98
1,354,200.00
5,698,152.18
1,236,068.40
7,195,808.35
11,467,787.41
81,190.00
13,830.00
225,963.45
138,309.50
125,250.00
217,105.60
HerfindahlIndex(HHI)
0.59
0.52
0.62
0.56
0.50
0.53
0.56
0.50
0.58
0.55
0.83
0.74
0.98
0.93
0.80
0.83
0.96
0.97
0.78
0.92
0.51
0.97
0.89
0.77
0.84
0.76
0.87
0.97
0.74
0.77
0.75
0.97
0.77
0.74
0.87
Numberof
Operators
2
2
2
2
2
2
2
2
2
2
6
3
4
2
2
2
2
2
2
2
3
2
3
3
2
4
3
2
6
2
2
2
2
2
2
Philippine Domestic Shipping Transport Industry
86
Max Baat
Douglas del Rosario
Sulpicio Lines
Isidro Refil
Arturo Susas
Sulpicio Lines
Sampaguita Shipping Corp
Rufino Augusto
Domingo Paredes
Leonardo Dauhog
Pedro Felizarta
La Felicidad Marine Corp
WG&A Philippines
Abdusakar Tan
Jose Leal, Agustin Nepomuceno
Dolorosa Ibo
Aquilina Guro
WG&A Philippines, Negros
Navigation
WG&A Philippines, Rover Shipping
Services, William Michael Shipping
Corp
Jaime Geraldoy, Eva Norono
Palacio Shipping, WG&A, Lite
Shipping Corp
La Felicidad Marine Corp
Dionisio Albania
La Felicidad Marine Corp
La Felicidad Marine Corp,
Terban Marine Corp
Dominador Taglorin, Felix Rabasto,
Charlito Villanueva, Dioneto
Villanueva
Eduardo Donan, Rodolfo Monilla,
Edilberto Bajao
Lorenzo Shipping Corp
Cebu Ferries Corp, Phil Fast
Ferry Corp
Cebu Ferrries Corp, Sulpicio Lines
Cebu Ferries Corp, Sulpicio Lines
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
1.35
1.23
1.02
1.39
1.33
1.01
1.12
1.02
1.27
1.16
1.30
1.02
1.33
1.35
2.28
1.47
1.49
1.69
3.59
1.96
2.12
1.58
1.59
1.52
1.88
3.97
3.15
1.49
2.55
1.94
1.62
Name of Operator/s Share
85.3
89.7
99.1
83.2
85.4
99.5
94.4
99.2
88.0
92.7
86.7
98.8
86.1
84.8
89.8
82.0
79.3
94.9
89.0
94.6
41.3
75.9
75.6
78.3
94.8
67.4
62.8
80.9
86.4
88.0
89.0
Route
Liloan/ Sibulan
Mandaue/ Bantayan
Manila/ Catbalogan
Masbate/ Roxas
Maya/ San Isidro
Ormoc/ Masbate
Pagadian/ Zamboanga
Sta Rosa/ Dapdap
Surigao/ Dapa
Tab-ok/ Kikilo
Tab-ok/ Tibo
Tacloban/ Batangas
Tacloban/ General Santos
Zamboanga/ Pagadian
Routes with mild competition
Antimonan/ Alabat
Babak/ Sasa
Bacolod/ Bauan
Bacolod/ Davao
Bacolod/ Iligan
Bacolod/ Romblon
Bacolod/ Tacloban
Batangas/ Legaspi
Batangas/ Mindoro
Batangas/ Pandacan
Batangas/Calapan/Masbate
Boracay/ Caticlan
Butuan/ Magallanes
Cagayan de Oro/ Batangas
Cebu/ Camotes
Cebu/ Cotabato
Cebu/ Iligan
CargoRevenue
10,280.00
1,571,062.17
3,576,428.10
189,850.00
158,180.00
645,907.79
405,090.55
22,008.00
8,345.00
9,710.00
22,515.80
2,870,870.42
485,020.42
2,524,315.25
120,603.60
7,937.20
142,646.25
2,107,167.25
845,039.66
46,500.00
257,328.47
7,631,981.52
102,349.90
9,849,942.35
3,857,366.46
525,474.50
263,707.50
4,428,294.45
8,565,790.15
16,838,080.91
42,424,129.13
HerfindahlIndex(HHI)
0.74
0.82
0.98
0.72
0.75
0.99
0.89
0.98
0.79
0.86
0.77
0.98
0.75
0.74
0.44
0.68
0.67
0.59
0.28
0.51
0.47
0.63
0.63
0.66
0.53
0.25
0.32
0.67
0.39
0.52
0.62
Numberof
Operators
3
2
2
2
2
2
2
2
2
2
2
2
3
2
3
6
2
4
5
3
5
2
2
2
3
3 5
1 0
3
3
5
1 0
3
Appendixes
87
Victan Transport Services,
Hosanna Shipping
Hosanna Shipping Corp, Palacio
Shipping Inc
MY Lines, San Juan Shipping Lines
William Michael Shipping Corp,
Cebu Ferries Corp
Cebu Ferries Corp, Lorenzo
Shipping, Palacio Shipping Inc
Jones Carrier, WG&A Philippines
Cebu Ferries Corp, George and
Peter Lines, Ever Lines
Mabjunnix Shipping, Cesar
Sumalpong
Philip Go, Lite Shipping
Cebu Ferries Corp, Ever Lines,
Hosanna Shipping
Via Marine Corp
Inter-island Maritime Corp,
Sulpicio Lines
Negros Navigation, WG&A
SKMMOOA, Maria Balena, Santiago
Siloterio, Anacleto Galabo, Anita
Galve, Ruthelo Geonanga, Eduardo
Gando, Nelia Canon, Fernando
Espinosa, Nerissa Pelingon
Romeo Geraldoy
WG&A Philippines, Sulpicio Lines
WG&A Philippines, Sulpicio Lines
Hadji Ahmad, Asman Jaide,
Sampaguita Shipping Corp
Sampaguita Shipping Corp
Den Tadus
Erwin Tan, Sampaguita Shipping
Lines, Hadji Tan, Radzma Burahan,
Anton Burahan, Hadji Daud
Liwanag Mendoza
Ocean Express Shipping Lines
Hadji Hahmad, Sampaguita
Shipping Corp
Hadji Hahmad
Sampaguita Shipping Corp
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
2.56
2.20
1.63
2.33
2.94
2.09
3.26
2.12
2.03
2.87
1.54
2.30
2.05
10.30
1.44
1.91
2.01
2.78
1.47
1.51
5.97
1.58
1.56
1.90
1.43
1.40
Name of Operator/s Share
85.5
88.0
92.6
57.6
90.3
97.2
89.2
85.2
89.8
87.8
78.2
88.1
86.7
69.9
81.3
80.1
84.4
94.7
79.9
78.6
85.9
75.7
76.7
94.8
82.5
82.6
Route
Cebu/ Legaspi
Cebu/ Leyte (Isabel)
Cebu/ Naval
Davao/ Iligan
Dumaguete/ Davao
Dumaguete/ Dipolog
Dumaguete/ Iligan
Dumaguete/ Siquijor
Dumaguete/ Tacloban
Iligan/ Zamboanga
Iloilo/ Batangas
Iloilo/ Butuan
Iloilo/ Cagayan de Oro
Iloilo/ Guimaras (Jordan)
Iloilo/ Negros Occidental
Iloilo/ Tacloban
Iloilo/ Zamboanga
Jolo/ Siasi
Jolo/ Sitangkai
Jolo/ Tawi-tawi
Jolo/ Zamboanga
Mamburao/ Bauan
Manila/ Escalante
Siasi/ Bongao
Sitangkai/ Bongao
Sitangkai/ Siasi
CargoRevenue
725,000.00
336,314.50
813,952.28
2,124,285.09
2,357,924.61
940,929.87
339,605.86
124,429.40
104,546.94
1,961,677.41
5,824,441.02
176,425.62
17,632,866.97
1,967,178.25
32,100.00
442,697.73
10,892,946.35
269,735.15
45,876.80
78,889.00
7,258,975.93
149,455.56
172,000.00
336,099.65
198,573.75
55,298.85
HerfindahlIndex(HHI)
0.39
0.46
0.61
0.43
0.34
0.48
0.31
0.47
0.49
0.35
0.65
0.43
0.49
0.10
0.70
0.52
0.50
0.36
0.68
0.66
0.17
0.63
0.64
0.53
0.70
0.71
Numberof
Operators
3
4
3
3
4
3
5
5
3
6
4
3
9
2 4
2
4
5
4
2
2
1 0
2
2
3
3
2
Philippine Domestic Shipping Transport Industry
88
Erlinda Atianzar, Andrea Vargas,
Caesar Playda, Alejandro Requina,
Jesus Basarten, Flaviano Cuenca
Jesus Plarilla, Diana Barail
Marites Pielaga
Jones Carrier, Eduardo Jarque
Jones Carrier
Cebu Ferries Corp, Hosanna
Shipping
Sulpicio Lines, William Chiong
Alibasa Alih, Jovito Chiong,
George Tan
Sampaguita Shipping Corp
Sing Hock Chua Amik
Ever Lines
Ever Lines
Magnolia Shipping Corp
Hadji Mubin Daud, Magnolia
Shipping Corp
Jasper Askalani, Lino Lao,
Jainal Tiking
Appendix Table 6. ContinuedEffective Competitors
Number=1/HHI
5.97
2.12
1.42
1.99
1.55
1.85
1.67
3.26
1.54
1.47
1.50
1.40
1.53
2.42
2.74
Name of Operator/s Share
91.0
87.1
81.9
97.7
77.1
97.4
89.8
92.1
58.0
80.1
78.8
82.9
77.5
88.7
99.0
Route
Sta Ana/ Penaplata
Sta Ana/ Sta Cruz
Sta Cruz/ Gen Luna
Tacloban/ Dipolog
Tacloban/ Gingoog
Tacloban/ Iligan
Tacloban/ Zamboanga
Zamboanga/ Basilan
Zamboanga/ Bongao
Zamboanga/ Leyte (Isabela)
Zamboanga/ Malangas
Zamboanga/ Margosatubig
Zamboanga/ Sagasa
Zamboanga/ Siasi
Zamboanga/ Tawi-tawi
CargoRevenue
5,085.00
6,612.00
175,980.00
6,558,856.11
2,922,366.00
1,477,130.15
144,690.38
1,033,976.45
1,665,807.60
100,750.00
223,787.19
302,255.13
109,345.01
1,327,871.60
968,649.00
HerfindahlIndex(HHI)
0.17
0.47
0.70
0.50
0.65
0.54
0.60
0.31
0.65
0.68
0.67
0.72
0.65
0.41
0.36
Numberof
Operators
7
3
2
3
2
3
4
4
3
2
2
2
2
4
4
Source: 1998 Annual Traffic Reports of Shipping Companies submitted to the MARINA.
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Balbon, P. Jr. 1989. The Philippine Interisland Liner Shipping Industry: AnInsight into the Provision of Shipping Services by the Private Sector.Private Sector Papers. Regional Seminar on Transport Policy Vol. 2. Manila:ADB and Economic Development Institute.
Balisacan, A. 1989. An Analysis of Philippine Interisland Shipping Industry.UPSE Discussion Paper No. 89-09. Quezon City: University of thePhilippines School of Economics.
Basilio, E. 1997. Study on the Contributions of the Interisland Shipping Industry tothe Philippine Economy. Pasig City: SBE Consulting.
Dick, H. 1987. The Indonesian Interisland Shipping Industry: An Analysis ofCompetition and Regulation. Singapore: Institute of Southeast AsianStudies.
Economic Development Institute. 1989. Philippine Country Paper. RegionalSeminar on Transport Policy Vol. 2. Manila: ADB and Economic Develop-ment Institute.
Fink, C., A. Mattoo and I. Neagu. 2000. Trade in International MaritimeServices: How Much Does Policy Matter. Paper presented at the APECRegional Seminar on WTO Issues: Investment and Competition Policies,29-30 November 2000, Makati City, Philippines.
Free Trade Asia Consulting Inc. 1998. Industry Structure and Competitivenes:Inter-island Freight Shipping Industry. TAPS PP 1998-21. Manila: Tradeand Investment Policy Analysis and Advocacy Support Project, Philexport.
Hanlon, P. 1996. Global Airlines, Competition in a Transnational Industry. GreatBritain: Butterworth-Heinemann
Lorenzo, E. 1997. The Domestic Shipping Industry of the Philippines: ASituation Report. Maritime Industry Authority, Manila.
Nathan and Associates Inc. 1994. Liner Shipping Route Study, Final Reportvol. 1 and 14. USAID: Manila.
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Philippine Exporters Confederation Inc. 1999. Proceedings of the Forum onthe Impact of the 1998 US Ocean Shipping Reform Act on PhilippineExports. January 6, Manila.
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Philippine Exporters Confederation Inc. 1999. Unbundling FreightRates Imposed by Foreign and Domestic Shipping Lines on InterislandTransport of Export and Import Cargoes. Manila: Trade and InvestmentPolicy Analysis and Advocacy Support Project, Philexport.
Philippine Interisland Shipping Association and Filipino ShipownersAssociation (PISA). 2001. Philippine Shipping Industry Position Paper.Manila.
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Stewart-Smith, M. C. 1999. Industry Structure and Regulation. Washington D.C.:World Bank.
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Philippine Domestic Shipping Transport Industry
90
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