NGO urges RP air panel to reject US bids on cargo, code-sharing

Travel and cargo industry leaders have urged the Philippine air panel that will hold talks with its American counterparts on the RP-US Air Transport Agreement (ATA) scheduled next month to remain firm on its stand, particularly on the cargo issue and the third country code sharing arrangement being proposed by the US.

Robert Lim Joseph, president of the Save Our Skies (SOS) Movement, which is composed of travel and tour operators, cargo forwarders and businessmen engaged in other airline-related businesses said the RP panel should consider the interests of the local airline industry in its talks with American officials.

Joseph was encouraged by the statements of Transpiration Undersecretary Arturo Valdez, former chairman of the RP panel, and Civil Aeronautics Board (CAB) Executive Director Tomas Mañalac during a Senate hearing last week that the government would push for the deferment of the implementation of the 1982 RP-US ATA, particularly on the lifting of restriction on capacities.

The panel has also opposed the granting of 7th freedom privileges to American cargo carriers Federal Express (FedEx) and United Parcel Service (UPS) and third country code-sharing arrangement as these would result in the collapse of the local airline and cargo industries.

Valdez and Manalac said US negotiators are expected to aggressively push for 7th freedom cargo privileges and third country code-sharing when the talks resume in Manila next month.

"What the US panel is pushing hard is third country code sharing and 7th freedom on cargo, which we rejected during our first meeting (in Washington DC last February)," Valdez said.

Joseph said local freight forwarders have been put at a disadvantage when FedEx, operating out of Subic, and UPS, operating out of Clark, unilaterally started exercising 7th freedom privileges by operating independent flights between the Philippines and third countries.

He said these US cargo carriers have based small aircraft in the Philippines and fly them without limitations to all points in the Asian region as if the Philippines is their own country.

The RP-US ATA does not grant 7th freedom privileges to these cargo carriers, thus all US carrier cargo flights on the RP-Asia routes must connect with the RP-US flights, "like branches from the main trunk."

Joseph said these US cargo carries used to handle small cargoes or parcels. Now, they are handling volume cargo on commercial quantity and have several flights a day.

"These cargo airlines have established themselves as an integrator and logistics provider, dealing directly with shippers and importers. As a result, local cargo agents are slowly being dislocated," he stressed.

Sen. Sergio Osmena III, for his part, assured local aviation leaders that the US’ proposal for a more liberalized cargo policy "will not pass the Senate."