2002 POEA Rules and Regulations Governing the Recruitment and Employment of Seafarers
PART II - LlCENSING AND REGULATION
PARTICIPATION OF PRIVATE SECTOR IN THE MARITIME EMPLOYMENT PROGRAM
Section 1. Qualifications. Only those who possess the following qualifications may be permitted to engage in the business of recruitment and placement of Filipino seafarers:
a. Filipino citizens, partnerships or corporations at least seventy-five percent (75%) of the authorized and voting capital stock of which is owned and controlled by Filipino citizens;
b. A minimum capitalization of Two Million Pesos (P2,000,000.00) in case of a single proprietorship or partnership and a minimum paid-up capital of Two Million Pesos (P2,000,000.00) in case of a corporation; Provided that those with existing licenses shall, within four years from effectivity hereof, increase their capitalization or paid up capital, as the case may be, to Two Million Pesos (P2,000,000.00) at the rate of Two Hundred Fifty Thousand (P250,000.00) every year; and
c. Those not otherwise disqualified by law or other government regulations to engage in the recruitment and placement of seafarers.
Section 2. Disqualification. The following are not qualified to engage in the business of recruitment and placement of Filipino seafarers.
a. Travel agencies and sales agencies of airline companies;
b. Officers or members of the Board of any corporation or members in a partnership engaged in the business of a travel agency;
c. Corporations and partnerships, when any of its officers, members of the board or partners, is also an officer, member of the board or partner of a corporation or partnership engaged in the business of a travel agency;
d. Persons, partnerships or corporations which have derogatory records, such as but not limited to the following:
1. Those certified to have a derogatory record by the National Bureau of Investigation or by the Anti-Illegal Recruitment Branch of the POEA;
2. Those against whom probable cause or prima facie finding of guilt for illegal recruitment or other related cases exists;
3. Those convicted for illegal recruitment or other related cases and/or crimes involving moral turpitude;
4. Those agencies whose licenses have been previously revoked or cancelled by the Administration for violation of RA 8042, PD 442, as amended, and their implementing rules and regulations as well as these rules and regulations.
All applicants for issuance/renewal of license shall be required to submit clearances from the National Bureau of Investigation and Anti-illegal Recruitment Branch, POEA, including clearances for their respective officers and employees.
e. Any official or employee of the DOLE, POEA, OWWA, DFA and other government agencies directly involved in the implementation of R.A. 8042 and/or any of his/her relatives within the fourth civil degree of consanguinity or affinity; and
f. Persons, partners, officers and directors of corporations whose licenses have been previously cancelled or revoked for violation of recruitment laws.
ISSUANCE OF LICENSE
Section 1. Requirements for Licensing. Every applicant for license to operate a manning agency shall submit a written application together with the following requirements:
a. A certified copy of the Articles of Incorporation or of Partnership duly registered with the SEC, in the case of a corporation or partnership or Certificate of Registration of the firm or business name with the Department of Trade and Industry (DTI), in the case of single proprietorship.
b. Proof of financial capacity. In the case of a single proprietorship or partnership, verified income tax returns of the proprietors or partners for the past two (2) years and a savings account showing a maintaining balance of not less than Five Hundred Thousand Pesos (P500,000.00), provided that the applicant should submit an authority to examine such bank deposit. In the case of a newly organized corporation, submission of a savings account showing a maintaining balance of not less than Five Hundred Thousand Pesos (P500,000.00), with authority to examine the same. For an existing corporation, submission of a verified financial statement, corporate tax returns for the past two (2) years and a savings account showing a maintaining balance of not less than Five Hundred Thousand Pesos (P500,000.00) with the corresponding authority to examine such deposit.
c. Proof of marketing capability:
1. A duly executed Special Power of Attorney authenticated by the Philippine Embassy/Consulate or verified by the Labor Attaché in the place where the vessel owner/operator/manager holds its principal office;
2. A duly concluded manning agreement authenticated by the Philippine Embassy/Consulate or verified by the Labor Attaché in the place where the vessel owner/operator/manager holds his/its principal office;
3. Crew order/s of not less than fifty (50) seafarers from its new market; and
4. Certification from Pre-Employment Services Office of POEA on the existence of new market.
d. Clearance of all members of the board of directors, partners and proprietor of the applicant agency from the NBI, Anti-Illegal Recruitment Branch of POEA and other government agencies as the need may require; provided that where the member or partner concerned is a foreigner, clearance from his country of origin shall be required.
e. A verified undertaking stating that the applicant shall:
1. Provide its seafarers orientation on recruitment policies and procedures, terms and conditions of employment and other relevant information;
2. Ensure that any seafarer recruited or deployed by them is qualified and holds the documents necessary for the job concerned;
3. Ensure that contracts of employment are in accordance with the standard employment contract and other applicable laws, regulations and collective bargaining agreements;
4. Ensure that seafarers are informed of their rights and duties under their contracts of employment and the articles of agreement prior to or in the process of engagement;
5. Ensure that proper arrangements are made for seafarers to examine their contracts of employment and articles of agreement before and after they are signed and for them to receive a copy of the contract of employment;
6. Ensure that the vessel/s and the crew are adequately covered by P & I Club or similar insurance thru the submission of the certificate of insurance coverage;
7. Assume full and complete responsibility for all claims and liabilities which may arise in connection with the use of the license;
8. Assume joint and solidary liability with the employer for all claims and liabilities which may arise in connection with the implementation of the employment contract, including but not limited to wages, death and disability compensation and their repatriation;
9. Guarantee compliance with the applicable labor, social and maritime legislations of the Philippines, and applicable regulations of the flag state and international maritime bodies such as the International Maritime Organization (IMO) and the International Labor Organization (ILO);
10. Assume full and complete responsibility for all acts of its officials, employees and representatives done in connection with recruitment and placement;
11. Deploy at least fifty (50) seafarers to its new market within one-year from issuance of its license which shall also be a condition to the accreditation of old principals; and
12. Repatriate the deployed seafarers when the need arises.
f. In case of corporation or partnership, verified undertaking by officers, directors and partners that they will be jointly and severally liable with the company over claims arising from employer-employee relationship.
g. Individual income tax return of the proprietor, partners, or board of directors as the case may be, for the past two (2) years.
h. Proof of possession by the sole proprietor, partner or chief executive officer, as the case may be, of a bachelor’s degree and three years business experience.
i. List of all officials and personnel involved in the recruitment and placement, together with their appointment, bio-data and two (2) copies of their passport size pictures as well as their clearances from the NBI and the Anti-Illegal Recruitment Branch, POEA.
j. Copy of contract of lease or proof of building ownership, indicating the office address and providing for an office space of at least one hundred (100) square meters.
k. Proof of publication of notice of the application with the names of the proprietor, partners, incorporators and officers;
l. Certificate of attendance of owner and/or chief executive officer in a pre-application seminar conducted by the Administration.
Only applications with complete supporting documents shall be processed.
Section 2. Payment of Filing Fee. Upon receipt of an application with complete requirements, the Administration shall require payment of a non-refundable filing fee of Ten Thousand Pesos (P10,000.00) and submission of proof of payment thereof.
Section 3. Action Upon the Application. Within fifteen (15) calendar days from receipt of an application with complete requirements including proof of payment of the filing fee of Ten Thousand Pesos (P10,000.00), the Administration shall evaluate the pertinent documents, inspect the office premises of the applicant and determine whether or not to grant the application. Denial of an application will result to the forfeiture of the filing fee.
Section 4. Payment of Fees and Posting of Bonds. Upon approval of the application, the applicant shall pay a license fee of Fifty Thousand Pesos (P50,000.00). It shall submit an escrow agreement in the amount of One Million Pesos (P1,000,000.00), confirmation of escrow deposit with a reputable bank and a surety bond of One Hundred Thousand Pesos (P100,000.00) from a bonding company acceptable to the Administration and accredited with the Insurance Commission.
Agencies with existing licenses shall, within four years from effectivity hereof, increase their Escrow Deposit to One Million Pesos (P1,000,000.00) at the rate of One Hundred Seventy-Five Thousand (P175,000.00) pesos per year.
The bonds and escrow shall answer for all valid and legal claims arising from violations of the conditions for the grant and use of the license and/or contracts of employment. The bonds and escrow shall likewise guarantee compliance with the provisions of these rules and pertinent Philippine laws and all liabilities which the Administration may impose. The surety bonds shall
include the condition that notice to the principal is notice to the surety and that any final and executory judgment against the principal in connection with matters falling under POEA’s/NLRC’s jurisdiction shall be binding and conclusive on the surety. The surety bonds shall cover the validity period of the license.
Section 5. Provisional License. Applicants for new license shall be issued a provisional license which shall be valid for a limited period of one (1) year within which the applicant should be able to comply with its undertaking to deploy 50 seafarers to its new principal. The license of a complying agency shall be upgraded to a full license entitling them to another three years of operation. Non-complying agencies will be notified of the expiration of their license.
Section 6. Validity of the License. Except in case of a provisional license, every license shall be valid for four (4) years from the date of issuance unless sooner cancelled, revoked or suspended for violation of applicable Philippine law, these rules and other pertinent issuances. Such license shall be valid only at the place/s stated therein, subject to the conditions of the subsequent paragraph, and when used by the licensed person, partnership or corporation.
Section 7. Non-Transferability of the License. No license shall be transferred, conveyed or assigned to any person, partnership or corporation. It shall not be used directly or indirectly by any person, partnership or corporation other than the one in whose favor it was issued.
In case of death of the sole proprietor, and in order to prevent disruption of operations and so as not to prejudice the interest of legitimate heirs, the license may be extended upon request of the heirs, to continue only for the purpose of winding up business operations.
Section 8. Change of Ownership/Relationship of Single Proprietorship or Partnership. Transfer or change of ownership of a single proprietorship licensed to engage in maritime employment shall cause the automatic revocation of the license.
A change in relationship of the partners in a partnership duly licensed to engage in maritime employment, which materially interrupts the course of the business or results in the actual dissolution of the partnership, shall likewise cause the automatic revocation of the license.
Section 9. Upgrading of Single Proprietorship or Partnerships. License holders, which are single proprietorships or partnerships, may convert into a corporation for purposes of upgrading or raising their capabilities to respond adequately to developments/changes in international shipping and to enable them to better comply with their responsibilities arising from the recruitment and deployment of seafarers.
The approval of merger, consolidation or upgrading shall automatically revoke or cancel the licenses of the single proprietorships, partnerships or corporations so merged, consolidated or upgraded.
Section 10. Derogatory Record After Issuance/ Renewal of License. The license of a single proprietorship and partnership shall be suspended until cleared by the Administration should any derogatory record be found to exist against the single proprietorship or any or all of the partners, as the case may be. The appointment of any officer or employee of any licensed agency may be cancelled or revoked at any time with due notice to the agency concerned, whenever said officer or employee is found to have any derogatory record, as herein contemplated.
Section 11. Appointment/Change of Officers and Personnel. Every appointment of agents or representatives of a licensed agency shall be subject to prior approval or authority of the Administration. The acknowledgment or approval may be issued upon submission of or compliance with the following:
a. Proposed appointment or special power of attorney;
b. Clearances of the proposed representative or agent from the NBI and the Anti-illegal Recruitment Branch of the POEA; and
c. Sworn or verified statement by the designating or appointing person or company assuming full responsibility for all acts of the agent or representative done in connection with the recruitment and placement of seafarers.
Every change in the composition of the board of directors of a corporation, appointment or termination of officers and personnel shall be registered with the Administration within thirty (30) calendar days from the date of such change. The agency shall be required to submit the minutes of proceedings duly certified by the SEC in case of election of new members of the board of directors with their bio-data, ID pictures and clearances.
The Administration reserves the right to deny the acknowledgment or appointment of officers, employees and representatives who were directly involved in recruitment irregularities.
Section 12. Publication of Change of Directors/Other Officers and Personnel/ Revocation or Amendment of Appointment of Representatives. In addition to the requirement of registration with and submission to the Administration, every change in the membership of the Board of Directors, termination for cause of other officers and personnel, revocation or amendment of appointment of representatives shall be published at least once in a newspaper of general circulation, in order to bind third parties. Proof of such publication shall be submitted to the Administration.
Section 13. Transfer of Business Address. Any transfer of business address shall be effected only with prior authority or approval of the Administration. The approval shall be issued only upon formal notice of the intention to transfer with the following attachments:
a. In the case of a corporation, a Board Resolution duly registered with the SEC authorizing the transfer of business address; and
b. Copy of the contract of lease or proof of building ownership.
The new office shall be subject to the regular ocular inspection procedures by duly authorized representatives of the Administration.
A notice to the public of the new address shall be published in a newspaper of general circulation.
Section 14. Establishment of Extension Offices. Extension offices may be established subject to the prior approval of the Administration.
Section 15. Renewal of License. An agency shall submit an application for the renewal of its license on or before the expiration of the license. Such application shall be supported by the following documents:
a. Renewed or revalidated surety bond amounting to One Hundred Thousand Pesos (P100,000.00);
b. Renewed escrow agreement in the amount of One Million Pesos (P1,000,000.00) with a commercial bank to primarily answer for valid and legal claims of recruited seafarers as a result of recruitment violations or money claims;
c. Audited financial statements for the past two years with verified corporate or individual tax returns. In case the equity of the agency is below the minimum capitalization requirement, it shall be given thirty (30) days from release of the renewed license to submit proof(s) of capital infusion, such as SEC certification of such infusion or bank certification corresponding to the amount infused and treasurer’s affidavit duly received by the SEC. Otherwise the license shall be suspended until it has complied with said requirement;
d. Clearances from the NBI and Anti-Illegal Recruitment Branch for all its employees and officers; and
e. Other requirements as may be imposed by the Administration.
Section 16. Monitoring Compliance with Conditions of License. The Administration shall monitor the compliance of agencies with their undertakings in connection with the issuance or renewal of the license. Appropriate sanctions shall be imposed for non-compliance with any of their undertakings.
Section 17. Non-expiration of License Pending Renewal. Where the license holder has made timely and sufficient application for renewal, the existing license shall not expire until the application shall have been finally determined by the Administration. For this purpose, an application shall be considered sufficient if the applicant has complied with the requirements for renewal.
Section 18. Action on Renewal of License. Within forty-eight (48) hours from receipt of the application for renewal with the complete requirements, the Administration shall undertake evaluation and inspection and determine the grant or denial of the application. Application for renewal of license which fail to meet the requirements set by the Administration, shall be denied.
Only applications for renewal submitted with complete requirements shall be processed.
Section 19. Late Filing of Renewal. Any agency which failed to file an application for renewal of license may be allowed to renew within thirty (30) calendar days from expiry thereof and subject to the payment of a fine of P10,000.00.
Section 20. Escrow Deposit as Garnished. As soon as an Order or Notice of Garnishment is served upon the bank, and the same is correspondingly earmarked, the deposit in escrow of an agency shall no longer be considered sufficient. The Administration shall forthwith serve upon the agency a notice to replenish its escrow deposit.
Section 21. Replenishment of Surety Bonds/Deposit in Escrow. Within fifteen (15) calendar days from date of receipt of notice from the Administration that the bonds/deposit in escrow or any part thereof had been garnished, the agency shall replenish the same. Failure to replenish such bonds/deposit in escrow within the said period shall cause the suspension of the license.
Section 22. Release of Deposit in Escrow. A licensed agency which voluntarily surrenders its license shall be entitled to the release of the deposit in escrow, only after posting a surety bond of similar amount valid for four (4) years from expiration of license and submission of the necessary clearances from the National Labor Relations Commission (NLRC) and the Administration.
Section 23. Classification, Ranking and Incentives. The Administration shall undertake the classification and ranking of agencies. In recognition of their exemplary performance, the Administration shall issue guidelines for entitlement of agencies to schemes for incentives and rewards such as extension of validity of the license, express processing and in-house documentation.