Airlines eye shift in basis of cargo fuel surcharge

MANILA, Philippines - Airlines in the Philippines are looking at changing the way they calculate their cargo fuel surcharge wherein forwarders and shippers are expected to shell out more, the Civil Aeronautics Board (CAB) disclosed over the weekend.

CAB hearing officer Maria Ellen Moro said the regulator is scheduled to conduct a hearing on Jan. 28 on the proposal of several airlines to impose cargo fuel surcharge based on chargeable weight instead of actual weight.

“Notice is hereby given that several airlines have filed with CAB an application for authority to impose cargo fuel surcharge based on chargeable weight instead of actual weight,” Moro said.

The CAB allows airlines to impose fuel surcharge on passengers and cargo as a temporary relief to help them recover losses arising from the increase in jet fuel prices in the world market.

Instead of computing on the basis of actual weight, airlines are now looking at changing the basis of their computation of the fuel surcharge based on chargeable weight.

The chargeable weight of a cargo intended for air shipment is the actual gross weight (GW) or the volume weight (VW), whichever is greater.

The chargeable weight is already used by carriers in many parts of the world and is now a legal requirement in some countries in Asia led by Japan.

However, the proposed shift in the basis of the cargo fuel surcharge would affect forwarders and their customers as volumetric shipments would be penalized with higher levy.

The CAB also furnished copies of the notice to the Air Forwarders of the Philippines Inc. (AFPI) and the Board of Airline Representatives (BAR).

Members of AHPI include DHL Express, Airfeight 2100 Inc., LBC Express, K-Line Logistics, Royal Cargo, U-Freight Philippines, UPS International, UPS-Delbros, among others.

On the other hand, member airlines of BAR include 30 airlines led by national flag carrier Philippine Airlines – jointly owned by taipan Lucio Tan and diversified conglomerate San Miguel Corp. (SMC) – that serve the Philippines.