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Commercial overview of the shipping industry

There are two sides to the Philippine shipping industry, and both can only be described in superlative terms. The Philippines is an archipelagic country of more than 7,000 islands, and so shipping provides a vital link throughout the country. The domestic shipping industry, however, is probably best remembered for the ill-fated collision between the passenger ferry Doña Paz and the petroleum product tanker Vector, which happened on 20 December 1987 and resulted in more than 4,000 deaths – the worst disaster at sea in peacetime. As could be expected, it spawned a considerable amount of litigation in the Philippines and the United States. In 2017, the Philippine domestic fleet consisted of 33,347 registered vessels, which moved people and cargo throughout the archipelago.

The Philippines is one of the largest providers of seafarers to the world's merchant marine fleet. In fact, it provides more than 30 per cent of the world's seafarers. In 2017, the Philippines deployed 378,072 seafarers internationally, and the number is projected to grow each year. In 2018, the nation earned more than US$28.94 billion from overseas Filipino workers, and of that total, almost US$6.1 billion came from Filipino seafarers employed by the world's merchant marine fleet. In 2018, the personal remittances of overseas Filipino workers constituted 9.7 per cent of the Philippines' gross domestic product.

The largest port in the Philippines is Manila, on the island of Luzon in the northern part of the country. In 2018, the total Philippine cargo throughput was recorded at around 256 million MT, and of that total, 103.16 million MT came from the Manila and Northern Luzon Ports alone. In central Philippines, the Panay Guimaras ports serve as the main hub for the distribution of goods within the central islands with a 12.017 million MT cargo throughput. Surigao and Davao are the major ports in the southern Philippines' island of Mindanao, which is largely the source of agricultural exports. The said ports' cargo throughput was recorded at 27.75 million MT and 18.49 million MT, respectively. In 2018, the Philippines imported US$109.92 million (free on board (FOB) value) worth of goods, while at the same time exporting goods worth US$67.48 million (FOB value). This trade is almost entirely dependent on shipping, which is the vital link between the islands of the Philippines and the rest of the world.

General overview of the legislative framework

The Philippines is a civil law country. The New Civil Code of the Philippines, which was enacted in 1949, was based on the Spanish Civil Code, but it is written in English rather than Spanish. The Philippines is no longer a Spanish-speaking country, so all enacted laws are in English and court proceedings are conducted in English. The Philippines also has a Code of Commerce, which is based on the Spanish Code of Commerce 1885. The Law on Obligations and Contracts is part of the New Civil Code, while the rules on domestic carriage of goods are set out in both the New Civil Code and the Code of Commerce. The latter also provides for the law on charter parties, collision and general average. Salvage is covered under a special law.

The Philippines also follows the system of judicial precedents and, therefore, the decisions of the Philippine Supreme Court, written in English, interpreting the provisions of the Civil Code, the Code of Commerce and other legislation, have the force of law. For the carriage of goods to and from Philippine ports in foreign trade, the Philippines adopted the United States Carriage of Goods by Sea Act of 1936 (the Philippine COGSA), which is basically the Hague Rules.

As mentioned above, the Philippines is a major provider of seafarers to the world's merchant marine fleet. More recent shipping-related legislation has tended to be with regard to overseas Filipino workers. As a result, on 13 March 2014, the Philippine Congress enacted Republic Act No. 10635, which established the Maritime Industry Authority (MARINA) as the single maritime administration responsible for the implementation and enforcement of the STCW Convention, as amended, and the international agreements or covenants related thereto.

In August 2012, the Philippines became the 30th member country of the International Labour Organization to adopt the Maritime Labour Convention of 2006. The adoption of the MLC 2006, the 'seafarer's bill of rights', was a concrete effort to protect the rights of Filipino seafarers at home and overseas. By doing so, the Philippine government recognised the significant contribution by Filipino seafarers to the growth of the country's economy.