‘Sulpicio must get franchise
from Congress, sell shares to public’

CEBU City – To ensure stronger oversight and greater accountability going forward, Catanduanes Cong. Joseph Santiago said Congress should mandate Sulpicio Lines Inc. and other inter-island shipping operators with vessels that carry more than 100 passengers to apply for and obtain a legislative franchise.

"Commercial passenger airlines are already required to secure a franchise from Congress. Passenger shipping operators should likewise be obliged to do so," said Santiago, vice chairman of the House legislative franchises committee.

At present, water passenger transport service providers simply get an administrative franchise from the Maritime Industry Authority, an agency attached to the Department of Transportation and Communications.

Corporations issued legislative franchises are duty-bound to submit periodic reports to Congress, on top of other regulatory filings.

Santiago also said Congress should direct Sulpicio and other passenger shipping firms to sell at least 25 percent of their equity to the investing public and list their shares in the Philippine Stock Exchange (PSE).

"Our sense is, entities compelled to live by higher corporate governance standards, such as those listed in the PSE, tend to behave more responsibly. Not just in terms of efficiently producing profits for shareholders, but also in terms of adequately complying with public safety and environmental protection standards," Santiago said.

Aboitiz Transport System Corp., Sulpicio's bigger rival, is already a PSE-listed entity.

Sulpicio remains a closely held family-owned firm. Securities and Exchange Commission records show that Sulpicio's governing board is composed entirely of family members. The firm's principal officers are also all members of the Go family in Cebu.

Sulpicio has had an unusually poor track record when it comes to public safety. Based on the results of an ongoing House inquiry, the firm's vessels have been involved in 45 accidents since 1980.

Nearly 800 lives were lost when the 24,000-ton MV Princess of the Stars, the "crown jewel" of Sulpicio's fleet, capsized off Sibuyan Island in Romblon on June 21 at the height of typhoon Frank.

Up to now, Sulpicio is still trying to find ways to retrieve a 10-metric ton shipment of endosulfan, a toxic pesticide, in the sunken ship's cargo hold./PN