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Public Notice No. PD-13/6/2023-PPP/e-357407/l
Ministry of Ports, Shipping & Waterways invites comments/suggestions on the Draft
Migration of Tariff Guidelines, 2025 for Adoption of Market Determined Tariff for
PPP Projects under Guidelines for Rcgulation of Tariff 2005, Guidelines for Upfront
'l'ariff Setting for PPP Projects 2008, Guidelines for Determination of Tariff for
Projects 2013 & Tariff Guidelines 2019 -Regarding.
The final Draft Migration of Tariff Guidelines, 2025 for Adoption of Market
Detennined Tariff for PPP Projects under Guidelines for Regulation of Tariff 2005,
Guidelines for Upfront Tariff Setting for PPP Projects 2008, Guidelines fbr
Determination of Tariff for Projects 2013 & Tariff Guidelines 2019, after stakeholder
consultations are published/uploaded on the website of the Ministry.
2.
This Ministry requested all concerned stakeholders, experts, and the general
public to submit their suggestion/feedback on the said Draft Guidelines to this
Ministry by 12.03.2025.
Enclosures: As above
11qfiq S,Tl,( qT<zr/ Manish Kumar Yadav)
em< vfr+, STfGf H-fiFR / Under Secretary to the Govt. of India
((tnq: 011-23717731
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@_MIGRATION TARIFF GUIDELINES, 2025 FOR ADOPTION OF MARKET
DETERMINED TARIFF FOR PPP PROJECTS UNDERGUIDELINES FOR
REGULATION OF TARIFF2005,GUIDELINES FOR UPFRONT TARIFF SETTING
FOR PPP PROJECTS2008, GUIDELINES FOR DETERMINATION OF TARIFF
FOR PROJECTS 2013 AND TARIFF GUIDELINES 2019
Objective and Rationale
1.0 The market conditions for provision of Port services have undergone significant change
since liberalization in the Port sector. The sector has since witnessed changing role of
MajorPortAuthorities with introduction and increasing Public Private Partnerships at
MajorPorts and also increased competition from Minor/Non-MajorPorts.
2.0 In this backdrop, the Ministry of Ports, Shipping and Waterways (MOPSW) decided to
repeal the erstwhile MajorPort Trusts Act 1963 and enact a new Legislation governing the
management of MajorPorts in India with a view to provide more autonomy and flexibility to
MajorPorts and to professionalize their governance. There were two fundamental tenets
envisaged in the new legislation viz.
(a)Enabling transformation of MajorPorts from ‘service Port’ model to ‘landlord Port’
model by allowing greater independence and agile governance to Port authorities. At the
same time transitioning to increased role of Public Private Partnerships in business
operations at Major Ports, to enable them to better respond to market forces.
(b)Powers to Port Authorities and PPP Concessionaires to fix tariff to allow price
competitiveness with Minor/Non-MajorPorts by removing the role of Tariff Authority for
Major Ports (TAMP) in tariff fixation.
3.0 The Parliament of India enacted the revised MajorPort Authorities Bill, 2020 to replace
the MajorPort Trusts Act, 1963. The Ministry of Law and Justice has published the
MajorPort Authorities Act, 2021 (MPA Act) in the Gazette of India vide Gazette no 3 dated
18 February 2021. The MPA Act came into force with effect from 03 November 2021 as per
Gazette Notification No. 4143 dated 29 October 2021 by the MOPSW.
Page 1 of 304.0 In furtherance of above-mentioned fundamental tenets, Section 27(1)of the MPA Act
provided as follows: -
“27.(1) The Board of each MajorPort Authority or the committee or committees constituted
in this behalf by the Board in accordance with Section 14, may -
(a)frame scale of rates at which, and a statement of conditions under which, any services
shall be performed or made available;
(b)frame scale of rates at which, and a statementof conditions under which, the access to
and usage of the Port assets may be allowed by the Board;
(c)frame consolidated scale of rates for any combination of services specified in clause(a)
or for any combination of such service or services with any user or permission to use or
access to any Port assets as specified in clause (b);
(d)pass an order for refund of any amount overcharged by the Board in relation to the
services provided to any person;
(e)pass an order for recovery of any rate or charge which is short- leviedor erroneously
refunded by the Board to any person under this Act; and
(f)frame different scales, fees, rates and conditions for different classes of goods and
vessels under this section;
Provided that the fixation and implementation of such scales, fees, rates and conditions
shall be in consonance with the norms as may be prescribed and shall-
(i) not be with retrospective effect
(ii) not be in derogation with the rules made by or directives of the Central
Government in this behalf;
(iii) not be inconsistent with the provisions of the Competition Act, 2002; and
(iv) not be inconsistent with the provisions of any other law for the time being in
force;
Page 2 of 30Provided that in case of Public Private Partnership Projects after the commencement of
this Act, concessionaire shall fix the tariff based on market conditions and on such other
conditions as may be notified:
Provided further that the revenue share and other conditions would be as per provisions
of the specific concession agreement between the Board and the Public Private
Partnership concessionaire appointed under the Public Private Partnership Project.
5.0 The above Article through the two Provisos, specifically and mandatory mandatedall the
existing and futurePublic Private Partnership concessionaires to fix the tariff prospectively
based on market conditions, within the ambit of revenue share and other provisions agreed
as per the respective Concession Agreements and with conditions as notified.It was thus
mandatory to introduce a regime which enables compulsory migration of all PPP
Projects/Concessionaires to a market determined tariff regime with conditions in line with
the second proviso. In fact, the MP Act does not distinguish between PPP Concessionaires
where CA was entered before the coming in effect of MP Act or PPP Concessionaires after
the coming in effect of the MP Act. All PPP Concessionaires are to be given same treatment
as far as market determined tariff is concerned. Also, the MP Act does not have any
provision for regulation and determination of tariff for PPP Concessionaires by any other
body/authority except by market determined tariff with conditions.
6.0 Subsequently, for the future Public Private Partnership projects, market determined
tariff regime proposed under the provisions of the MPA Act was codified through:
(a)The Model Concession Agreement (MCA), 2021 which allowed for concessionaires to
adopt market determined tariff and safeguarding Port authority interest by introducing
Royalty payment linked with Minimum Guaranteed Throughput (MGT)
(b) Tariff Guidelines, 2021 dated 21 December 2021 for framing of scale of Rates for the
Concession Agreements entered by the MajorPort Authority with PPP Concessionaire after
the MajorPort Authorities Act, 2021.
Introduction of Tariff Guidelines 2021 and the revised MCA permitted the PPP projects
awarded post the introduction of the referred MPA Act, to adopt market determined tariff.
Page 3 of 307.0 In the current context, the tariff setting of the PPP Concessionaires operating at the
MajorPorts are being governed under different sets of tariff guidelines issued by the
Ministry of Ports, Shipping and Waterways (MOPSW) from time to time. The key
regulations presently applicable for PPP projects at MajorPorts are as hereunder: -
(a)Tariff Guideline 2005 superseded by Tariff Guideline 2019: The PPP Projects bid out
prior to 26 February 2008 were earlier governed by the Tariff Guidelines of 2005 issued by
the then MSRTH. Effective 7 March 2019, they are now governed by the Tariff Guidelines
2019 issued by Ministry of Shipping (MOS).
(b)Tariff Guideline 2008: The PPP Projects which were bid out between 26 February 2008
and upto 30 July 2013 are governed under the Upfront Tariff Guidelines 2008 issued by
then Ministry of Shipping, Road Transport and Highways (MSRTH).
(c)Tariff Guideline 2013: The PPP Projects which were bid out from 31 July 2013 till the
MPA Act, 2021 came into force from 3 November 2021 fall under the purview of Reference
Tariff Guidelines, 2013 issued by the then Ministry of Shipping.
8.0 The Current scenario
In the past, tariffs were regulated due to limited competitive landscape but the evolving
market and competitive landscape necessitates deregulation: The original objective of
introducing the tariff regulations in 2005 inter alia included safeguarding interest of users,
while ensuring fair returns to the Port and encourage competition & efficiency. The long-
term objective outlined in the Tariff Guideline 2005 was competitive pricing. The market
and competitive landscape in the Indian Port sector has since witnessed a significant shift.
(a)Shift towards land-lord model: Previously, the MajorPort authorities were also the
service providers to end users as well as concessioning authority. Thus, the tariff
regulations played an important role in safeguarding the interest of both Port users and
PPP operators. With the transition to land-lord Port model and increased private sector
participation, the utility of tariff regulations (and fixation) in this context has diminished.
Page 4 of 30(b)Intra-Port parity and competition: The tariff regulations 2019(erstwhile
2005)/2008/2013 applicable to PPP/BOT projects have differing regulatory approach and
they presently subsist at the MajorPorts. Thereby, there is no level playing field amongst the
PPP Concessionaires.
(c) Competitiveness with respect to non-MajorPorts: Minor/Non- MajorPorts have
expanded rapidly and now have a substantial presence. The non-MajorPorts presently
account for about 45% of the traffic. There is no parity in the tariff regulation mechanism
between the MajorPorts and the Minor/non-MajorPorts.
(d)Need for consistent user experience in the current landscape: With role of private
sector in provision of Port services, improvement in transport infrastructure and enshrined
tariff transparency at MajorPorts, users now have opportunity and flexibility to avail
services best suited to them commercially. Competitive forces allow for self-regulation of
performance and tariffs. It is now essential to have uniform approach tariff setting allowing
for consistent user experience.
9.0 Thus, need was felt to address the disparity in differing regulations and tariff guidelines
subsisting at MajorPorts, in order to provide uniform user experience and ensuring level
playing field for PPP operators by allowing them to play a greater role in determination of
tariffs and better respond to competitive market forces. With this context, the matter relating
to migration of existing PPP Concessionaires to market determined regime was discussed
in the Chintan Baithak organised by MOPSW held in June 2022 at Coorg, Karnataka.
Chairpersons of MajorPort Authorities were present for the said Chintan Baithak amongst
others. In the said Chintan Baithak, directions were issued to MOPSW to formulate new
guidelines for migration of existing BOT Terminals to market-based tariff fixation which are
in consonance with the MPA Act.
10.0 Chairpersons of Majority of MajorPorts in a meeting held by MOPSW in May 2025,
opined that providing an option to the existing PPP concessionaires governed by Tariff
Guidelines of 2005, 2008, 2013 and 2019 to market determined tariff as has been done for
the prospective bidders for new PPP Projects would be desirable as it would provide a level
playing field to PPP Concessionaires who are presently governed under different guidelines
Page 5 of 30operating at MajorPorts. As per the signed Concession Agreements,PPP Concessionaires,
however, are bound to pay revenue share/royalty as prescribed in the Concession Agreement
to the MajorPort Authorities. Considering the procedural complexities involved in drafting
a workable solution within the framework of existing rules and regulations, a detailed
comprehensive study of whole issue, including legal financial and contractual aspects was
found advisable.
11.0 In this backdrop, MOPSW vide O.M.No. PD-13/6/2025-PPP/e-357407, dated 09 May
2025, constituted a Committee under the Chairmanship of Chairman, V.O.
ChidambaranarPort Trust (VOCPT) for deliberation regarding Migration of existing PPP
Concessionaires to market driven tariff regime as prescribed in Tariff Guidelines 2021. The
Chairmanship of the Committee was taken over by Chairman, JNPAuthority (JNPA) on
Chairman VOCPA taking over as Secretary, MOPSW with Chairmen of Chennai Port
Authority and Paradip Port Authority as members.
Based on detailed deliberation and consultation, the Committee outlined the following
approach: -
(a) All PPP Concessionaires operating under Guidelinesfor Regulationof Tariff 2005, Tariff
Guidelines 2008 / Reference Tariff Guidelines 2013 or Tariff Guidelines 2019 should
migrate to market determined tariff regime subject to conditions laid out in the tariff
guidelines.
(b) The PPP Concessionaire shall be required to sign a Supplementary Agreement.
(c) The PPP Concessionaire on migration shall be free to fix tariffs/fee/scale of rates of the
services while ensuring due transparency and competitive landscape.
(d) There shall be no change in Royalty per unit/MT/TEU/FEU etc. or Royalty on Revenue
share basis as per the original Concession Agreement. Accordingly, the provisions of
MPA Act 2021would be adhered to.
(e) As an additional measure the Royalty as Revenue share of the MajorPort, should/would
not go below what it would have got under the regime when tariff was fixed/determined
as per the Tariff Guidelines. This would be done by converting the Revenue share to
Royalty based on the Annual Revenue Requirement of the Project as determined earlier.
Page 6 of 30(f) The concessions extended by the Central Government with regards to tariff for coastal
cargo/ container, transhipment container, etc shall be applicable and other Policy/
directions issued by the Government or clarification in this regard shall be applicable.
(g) The past disputes relating to tariff and other concession conditions may be resolved
between the parties (MajorPort Authority and PPP Concessionaire).
12.0 The Committee held wide ranging consultations and sought the comments and
suggestions during the consultation process from PPP Concessionaires, IPPTA and IPA.
Thereafter, considering these consultations by the Committee and the recommendations
made by the Committee, the existing guidelines for tariff regulation have been reviewed and
to give effect to the requirement of Article 27(1) which mandates the notification of the
conditions for market determined tariff, the Government hereby issues the below-mentioned
Migration Tariff Guidelines, 2025.
MIGRATION TARIFF GUIDELINES, 2025 FOR ADOPTION OF MARKET
DETERMINED TARIFF FOR PPP PROJECTS UNDER GUIDELINES FOR
REGULATION OF TARIFF2005,GUIDELINES FOR UPFRONT TARIFF SETTING
FOR PPP PROJECTS 2008, GUIDELINES FOR DETERMINATION OF TARIFF
FOR PROJECTS 2013 AND TARIFF GUIDELINES 2019
13.0 PRELIMINARY
13.1 These Guidelines are issued to the MajorPort Authorities (MPA) and existing PPP
Concessionaires governed under the erstwhile Guidelines for Regulation of Tariff
2005,Upfront Tariff Guidelines 2008, Reference Tariff Guidelines, 2013 and Tariff
Guidelines, 2019. The list of the PPP Concessionaires operating in aforementioned Tariff
Guidelines are provided as Annexure-I to this Guideline.
13.2This Tariff Guidelines may be called as “Migration of Tariff Guidelines, 2025 for
adoption of Market Determined Tariff for PPP Projects under Tariff Guidelines 2005,
Upfront Tariff Guidelines 2008, Reference Tariff Guidelines 2013 and Tariff
Guidelines, 2019”.
Page 7 of 3013.3These Tariff Guidelines will be applicable to all the PPP Concessionaires who have
entered into License Agreement/Concession Agreements(hereinafter referred to as
Concession Agreement) with all Major Port Authorities(MPA)under the Major Port
Authorities Act 2021 and with Kamarajar Port Limited (KPL) and are governed by erstwhile
Tariff Guidelines 2005, Upfront Tariff Guidelines, 2008, Reference Tariff Guidelines, 2013
and Tariff Guidelines, 2019 (referred to as “PPP Concessionaire” hereinafter). Hereinafter,
the term MPA will include KPL.
13.4These Tariff Guidelines shall be valid prospectively from the date of publication in the
Gazette of India and shall be applicable to the PPP Concessionaires from the date of signing
of Supplementary Agreement, post migration to this Tariff Guideline in accordance with
Para 25 of these Guidelines.
13.5 These Tariff Guidelines shall remain in force until reviewed or amended or modified or
revoked.
13.6Unless the context otherwise requires, various terms used herein will have the same
definition as in the MPA Act 2021, and the Indian Ports Act 1908, as amended from time to
time.
13.7All PPP Concessionaires shall continue to abide by the provisions contained in the
existing Concession Agreemententered into with the concerned MPA. Simultaneously, PPP
Concessionaires will also abide by these Tariff Guideline, by way of a separate written
Supplementary Agreement with the concerned MPA.
13.8If any difficulty arises in giving effect to these Tariff Guidelines, MOPSW may in
consultation with PPP Concessionaires governed under the erstwhile Tariff Guidelines of
2005, 2008, 2013, 2019 and MPAs make such orders, as may appear to be necessary for
removing the difficulty.
13.9For purposes of these Tariff Guidelines, the term 'Scale of Rates' shall mean the specific
tariff rates along with conditionalities that are to be determined, informed and published by
PPP Concessionaires as per market conditions in respect of the services authorized to be
Page 8 of 30rendered by the PPP Concessionaire as per the Concession Agreement signed between the
MPA and the PPP Concessionaire.
14.0 SCALE OF RATES(SOR)
A. DETERMINATION OF SCALE OF RATES
14.1Each PPP Concessionaire authorized by the MPA to provide services as set forth in their
respective Concession Agreement shall frame its own SORs and statement of conditions
based on the market conditions and other conditions as notified hereunder in these Tariff
Guidelines. The PPP Concessionaire is at the liberty to frame SOR(s)/a consolidated SOR
for any combination of services they perform/ provide to their users/ customers.
PROVIDED that; the services or combination of the services for which the SOR is framed
shall be in consonance with the services as prescribed in the Concession Agreement and shall
(i) not to be with retrospective effect;
(ii) not be in derogation with the rules made by or directives of the Central Government
in this behalf;
(iii) not to be inconsistent with the provisions of the Competition Act, 2002 (12 of 2003);
and
(iv) not be inconsistent with the provisions of any other law for the time being in force.
PROVIDED further that; the PPP Concessionaires shall abide by the para 22 of these Tariff
Guidelines, 2025 as regards payment of royalty/revenue shareby the PPP Concessionaire to
the MPA.
14.2The SOR along with conditionalities, for the services rendered shall be formulated by
the individual PPP Concessionaire, in accordance with these Tariff Guidelines, 2025 as
amended from time to time.
14.3The PPP Concessionaire shall ensure that the SORs includes tariff for all the services
rendered/ to be rendered by them within the scope of services prescribed in the Concession
Agreement to ensure transparency and complete disclosure of applicable charges on Port
users. The SORs may be categorized under the following broad categories –
Page 9 of 30a) Vessel Related Charges/Berth Hire Charges (if chargeable by the PPP Concessionaire
under the Concession Agreement)
b) Cargo/ Container Handling Charges
c) Storage Charges
d) Other or Miscellaneous Charges
14.4 The PPP concessionaire shall be governed by the Policy/ directions issued by the
MOPSW as regards concession in tariff for coastal cargo/ container, transshipment
container, etc., while framing their SORs.
14.5In future also, in case any discount or incentives are mandated by MOPSW under any
applicable law to be applicable on certain types or natures of containers/cargo, the
concession in tariff/SOR for such container/cargo types handled by PPP Concessionaires
shall be subjected to the same level of discounts.
B. CURRENCY OF SCONCESSION AGREEMENTLE OF RATES AND
CONVERSION OF TARIFF
14.6The Tariff for foreign laden vessels/cargo may be denominated either in INR or US
dollar. All Tariff for coastal vessels/cargo shall be denominated only in INR. All US dollar
denominated tariff set forth in the SORs will be recovered in Indian Rupees after conversion
of charges in US dollar terms into its equivalent Indian Rupees at the current reference rate
(as on the date of conversion) as notified by the Reserve Bank of India or the market buying
rate notified by State Bank of India.
14.7 Alternatively, PPP Concessionaire may recover US dollar denominated tariff in US
dollars after seeking approval of the Government and in compliance with the provisions of
Foreign Exchange Management Act, 1999.
14.8 The day of entry of the vessel into Port limits shall be reckoned as the day for such
conversion purposes in respect of Vessel Related Charges. In respect of Cargo/Container
related charges, the day of entry of the vessel in the case of import containers/ cargo and the
day of arrival of containers/ cargo into the Port in the case of export containers/ cargo shall
be reckoned as the day for such conversion.
Page 10 of 3014.9A regular review of exchange rate shall be made once in 30 (thirty) days from the date
of arrival in the cases of vessels staying in the Port for a period longer than 30 (thirty) days.
The basis of billing shall change prospectively with reference to the appropriate exchange
rate prevailing at the time of review.
C.REPORTING AND REVIEW OF SOR
14.10The PPP Concessionaire shall host the SORs as published rates/ tariff and applicable
conditionalities on its website for transparency. The SORs/amendment/ revision in SORs as
published by the PPP Concessionaire on the website including conditionalities shall be the
ceiling level i.e. the maximum rates or charges or tariff chargeable.
14.11The PPP Concessionaire may annually review its SORs and the conditionalities. The
PPP Concessionaire can modify, amend, increase, decrease, delete or add new tariff/
conditions and host the revised SORs along with conditionalities on its website in
accordance with the procedure set forth in these Tariff Guidelines, 2025. Without prejudice
to the aforementioned, the PPP Concessionaire can, if necessary, even during the year or
during the annual review, change or stipulate revisions to the SORs based upon market
conditions for existing cargo/ services provided by the PPP Concessionaire, rationalize
existing tariff/ existing conditionalities and can fix tariff/charge/ conditionalities based upon
market conditions for new cargo/ service as permissible within the scope of the Concession
Agreement(s).
14.12The SORs and any revised/ modified SORs and conditionalities will come into effect
only after expiry of 30 days prospectively from the date of first publishing of the SORs,
revision/ modification of the SORs as the case may be on the website of the PPP
Concessionaire.
14.13As a matter of abundant clarity, it is reiterated that the rates prescribed in the SORs
hosted on the website of the PPP concessionaire shall remain the published rates for the
particular PPP Concessionaire. No tariff or rates can be charged in excess of the said SORs.
It is however clarified that the PPP concessionaire would be at liberty to offer rebates and
discounts on the published SORs to its Port users/customers.
Page 11 of 3014.14The PPP Concessionaire shall also intimate in writing the SORs as amended from time
to time to the MPA and also issue trade notice.
15.0 The SORs of each PPP Concessionaire shall be decided subject to: -
(i) Para 17 in respect of 'Vessel Related Charges/Berth Hire Charges';
(ii) Para 18 in respect 'Cargo Related Charges';
(iii) Para 19 in respect of 'Transhipment of Container Related Charges';
(iv) Para 20 in respect of 'Storage Charges; and
(v) Para 16and 21in respect of ‘Status of vessel’ and 'Other aspects’ of these Tariff
Guidelines 2025 as amended from time to time.
16.0 STATUS OF VESSEL
16.1 The status of the vessel for purposes oftariff determination will be borne out by its
certification by the Customs or the Directorate General of Shipping. This shall be the deciding
factor for its classification as ‘coastal’ or ‘foreign-going/laden’ for the purpose of levying
various charges and, the nature of cargo or its origin will not be of any relevance for this
purpose.
16.2 System of classification of ‘vessel’
(a)A foreign going vessel of Indian flag having a General Trading Licence can convert to
‘coastal run’ on the basis of a Customs Conversion Order. Such vessel that converts into
‘coastal run’ based on the Customs Conversion Order at her first Port of call in Indian Port,
will not require any further custom conversion is required, so long as it moves on the Indian
Coast.
(b)A Foreign going vessel of foreign flag can convert to ‘coastal run’ on the basis of a
Licence for Specified Period or Voyage issued by the Directorate General of Shipping and a
Custom Conversion Order.
17.0 VESSEL RELATED CHARGES/BERTH HIRE CHARGES
17.1 This charge relates to the use by the vessel, of the Berth of PPP Concessionaire.
Page 12 of 3017.2.0Concessional tariff will be prescribed for Coastal Vessels as per the Policy
guidelines of the Government as amended from time to time.
17.2.1 As per the prevailing Coastal Concession Policy of the Government, in case of coastal
vessels, the vessel related charges should not exceed 60% of the published SOR/charges for
the corresponding SOR/charges for other (foreign going) vessels. Further, these
SOR/charges should be denominated and collected in Indian Rupees only.
17.2.2 The status of a vessel as borne out by its certification is the relevant factor to decide
whether the vessel is ‘foreign going/laded’ or ‘coastal’.
17.3.0 Criteria for levy of Vessel Related Charges/Berth Hire Charges at Concessional
Coastal rate
17.3.1 In cases of such conversion of vessel as set forth in para 16.2(a) and 16.2(b) above,
coastal rates shall be chargeable by the load Port from the time the vessel starts loading
coastal goods.
17.3.2 In cases of such conversion of vessel as set forth in para 16.2(a) and 16.2(b) above,
coastal rates shall be chargeable till the vessel completes discharging operations at the last
call of Indian Port. Immediately thereafter, foreign going rates shall be chargeable by the
discharge Ports.
17.3.3 For dedicated Indian coastal vessels having a Coastal licence from the Directorate
General of Shipping, no other document will be required to be entitled to coastal rate.
18.0 CARGO/CONTAINER RELATED CHARGES
18.1 This charge relates to handling of cargo/container from/to ship to shore transfer and
transfer from/ to quay to/ from storage yard including wharfage.
Page 13 of 3018.2Before classifying any cargo under “unspecified” category under the wharfage schedule,
the relevant Customs classification should be referred by the PPP Concessionaire to find out
whether the cargo could be classified under any of the specific categories mentioned in the
wharfage schedule.
18.3Concessional tariff for levy of Cargo/Container Related Charges will be prescribed
for Coastal cargoes/ Containers as per the Policy guidelines of the Government as
amended from time to time.
18.3.1Presently, as per the Coastal Concession Policy of the Government, the cargo/
container related charges for all coastal cargo/ containers, other than thermal coal and POL
including crude oil, iron ore and iron ore pellets should not exceed 60% of the published
SOR/charges for normal cargo/ container related charges. In case of cargo related charges,
the concession should be allowed on all the relevant cargo handling SOR/charges for ship-
shore transfer and transfer from/to quay to/from storage yard including wharfage.
18.4Criteria for levy of Cargo/Container Related Charges at Concessional Coastal rate
18.4.1Foreign going Indian Vessel having General Trading License issued for ‘worldwide
and coastal’ operation should be accorded applicable coastal rates with respect to
Cargo/Container Handling Chargesi.e. ship to shore transfer and transfer from/ to quay to/
from storage yard including wharfage in the following scenario:
(i)Converted to ‘coastal run’ and carrying coastal cargo from any Indian Port and destined
for any other Indian Port.
(ii)Not converted* to ‘coastal run’ but carrying coastal cargo from any Indian Port and
destined for any other Indian Port.
* The Central Board of Excise and Customs Circular no.15/2002-Cus. dated 25 February
2002 allows carriage of coastal cargo from one Indian Port to another Port in India, in
Indian flag foreign going vessels without any custom conversion.
18.4.2In case of a foreign flag vessel converted to coastal run on the basis of a Licence for
Specified Period or Voyage issued by the Directorate General of Shipping, and a Custom
Page 14 of 30Conversion Order, the coastal cargo/ container loaded from any Indian Port and destined for
any other Indian Port should be levied at the rate applicable for coastal cargo/ container.
18.4.3 For the purpose of this concession, cargo/ container from a foreign Port which
reaches an Indian Port ‘A’ for subsequent transshipment to Indian Port ‘B’ will also qualify
insofar as the charges relevant for its coastal voyage. In other words, cargo/containers
from/to Indian Ports carried by vessels permitted to undertake coastal voyage will qualify
for the concession.
18.4.4 To exemplify, in case a container from foreign Port reaches Indian Port ‘A’ for
subsequent transshipment to Indian Port ‘B’, 50% of foreign going rate and 50% of coastal
rate shall be applicable for vessels permitted to undertake coastal voyage.
19.0TRANSHIPMENT OF CONTAINER RELATED CHARGES
19.1 The handling charges for transhipment containers shall be concessional. Such published
SOR/charges shall not exceed 1.5 times the handling SOR/charges for the normal handling
operation in loading or unloading cycle. In case of transhipment of coastal containers, the
concession in handling charges prescribed above shall be calculated with reference to the
applicable handling SOR/charges (which are subject to the concessions specified in clause
18.6.1 above) for coastal containers for the normal handling operation in loading or
unloading cycle.
20.0STORAGE CHARGES
20.1 For Storage charges/Demurrage, free days allowed shall be exclusive of Customs
notified holidays and Port/ terminal non-working days. The number of free days, may be
fixed by individual PPP Concessionaire in its SOR. Once storage/demurrage charge starts
accruing, no allowance will be made for the customs notified holidays and Port/ terminal
non-working days.
20.2 Free Storage period for import cargo will commence from the day cargo is stored in the
stacking yard and is calculated on first- in first- out basis. Similarly for export cargo it is
determined from the day it reaches the stacking yard from the rake/vehicle.
Page 15 of 3020.3Free Storageperiod for import containers shall commence from the day after the day of
landing of the container and for export containers, the free period shall commence from the
time the container enters the terminal.
20.4The storage charges on abandoned FCL containers/ shipper owned containers shall be
levied upto the date of receipt of intimation of abandonment in writing or 75 days from the
day of landing of the container, whichever is earlier subject to the following conditions:
(i)The consignee can issue a letter of abandonment at any time.
(ii)If the consignee chooses not to issue such letter of abandonment, the container Agent/
MLO can also issue abandonment letter subject to the condition that,
(a)the Line shall resume custody of container along with cargo and either take back it or
remove it from the Port premises; and
(b)the line shall pay all Port charges accrued on the cargo and container before resuming
custody of the container.
(iii)The container Agent/ MLO shall observe the necessary formalities and bear the cost of
transportation and destuffing. In case of their failure to take such action within the stipulated
period, the storage charge on container shall be continued to be levied till such time all
necessary actions are taken by the shipping lines for destuffing the cargo.
(iv)Where the container is seized/ confiscated by the Custom Authorities and the same
cannot be de-stuffed within the prescribed time limit of 75 days, the storage charges will
cease to apply from the day the Custom order release of the cargo subject to lines observing
the necessary formalities and bearing the cost of transportation and de-stuffing. Otherwise,
seized/ confiscated containers should be removed by the line/ consignee from the Port
premises to the Customs bonded area and in that case the storage charge shall cease to apply
from the day of such removal.
21.0 OTHER ASPECTS
21.1 Port Users (i.e., users or customers of the PPP Concessionaire) will not be required to
pay charges for delays attributable to the PPP Concessionaire. For example, power failure,
malfunction/ non function of crane or equipment provided by the PPP Concessionaire.
Page 16 of 3021.2 Interest Rate: Port users (i.e., users or customers of the PPP Concessionaire) can be
subjected to interest on delayed payments and likewise the PPP concessionaire shall also pay
interest on delayed refunds at the same rate. For this purpose, the rate of interest should be
identical for amount receivable by the PPP concessionaire and payable by the PPP
concessionaire to be calculated on simple interest basis and not exceeding the interest rate of
delayed payment in the respective Concession Agreement.
21.3 The period for calculation of delay in payments by Port users (i.e., users or customers of
the PPP Concessionaire) will be counted beyond 10 days after the date of raising the bills by
the concerned PPP Concessionaire.
21.4 The delay in refunds by the PPP Concessionaire will be counted beyond 20 days from the
date of completion of services or on production of all documents required from the Port users
(i.e., users or customers of the PPP Concessionaire), whichever is late.
22.0 PAYMENT OF ROYALTY BY PPP CONCESSIONAIRES
22.1The existing PPP Concessionaire under the erstwhile 2005, 2008, 2013 and 2019 Tariff
Guidelines shall migrate and transit to these Tariff Guidelines, 2025and frame their own
SOR based on Market conditions (i.e. market based tariff). The PPP Concessionaire shall
abide by the below mentioned conditions and sign a separate Supplementary Agreement
with the respective MPA under the provisions of “Amendments, modifications or
alterations” to the terms of the Concession Agreement or similar such provision in the
Concession Agreement.
22.2All PPP Concessionaires governed under the Tariff Guidelines of 2008/ 2013 and
2005/2019 Tariff Guidelines shall pay annual Royalty to the concerned MajorPorts
Authority and the amount shall be higher of in each category of 22.2.1, 22.2.2 or 22.2.3
below: -
22.2.1 IN CASE ROYALTY IS DETERMINED IN CONCESSION AGREEMENT AS
PER UNIT/TONNE/TEU FOR EACH YEAR OF CA
Page 17 of 30(i) Royalty at per unit/tonne/ TEUin accordance with respective Concession
Agreementbased on/as per actual traffic.
(ii) Royalty at per unit/tonne/TEUas per the respective Concession Agreementbased on/ as
per the Minimum Guaranteed Traffic (MGT)/Minimum Guaranteed Cargo (MGC) (as the
case may be), if applicable.
22.2.2. IN CASE ROYALTY IS DETERMINED IN CONCESSION AGREEMENT AS
PER UNIT/TONNE/TEU FOR BASE YEAR WITH YEAR-WISE ESCALATION
FOR EACH YEAR OF CONCESSION AGREEMENT
(i) Royalty at per unit/tonne/TEU rate escalated as per escalation formula in accordance with
the respective Concession Agreement and based on/as per actual traffic.
(ii) Royalty at per unit/tonne/TEU rate escalated as per escalation formula in accordance
with the respective CA and based on the Minimum Guaranteed Traffic (MGT)/Minimum
Guaranteed Cargo (MGC) (as the case may be), if applicable.
22.2.3 IN CASE ROYALTY IS DETERMINED IN CONCESSION AGREEMENT AS
REVENUE SHARE OF GROSS REVENUE FOR EACH YEAR OF CONCESSION
AGREEMENT
The Royalty would be higher of: -
(i)Royalty in terms of Revenue share percentage as prescribed in the Concession
Agreementon theactualrevenue i.e.,Actualrevenue x Revenue share earned by the PPP
Concessionaire.
(ii)Royalty estimated on ‘ARRbased Royalty per tonne/TEU’(ARRBR).
(a)For the PPP concessionaires governed under Tariff Guidelines2008 and 2013, the ARRBR
is to be arrived for 2025-2026.The ARRBR is the Annual Revenue Requirement (ARR)
pertonne/TEU (ARR divided byoptimum capacity as per TAMP order) x Revenue share of
Gross Revenue as per Concession Agreement.The ARRBRwill be escalated annually
applying indexation @60% of the annual WPIfor subsequent years. TheRoyalty would be
Page 18 of 30ARR based Royalty per tonne/TEU x actual Trafficor MGC/ MGT if applicable,
whichever is higher.
(b)For the PPP concessionaires governed under Tariff Guidelines2005 and 2019, the
ARRBR is to be arrived for 2025-2026.For arriving at ARRBR, theaverage Annual Revenue
Requirement (ARR) for the three years of 2021-2022, 2022-2023 and 2023-2024 is to be
taken following the Tariff Guidelines 2019. The ARR would be escalated to the year 2025-
2026 as per the escalation factor of TAMP.The ARR per tonne/TEUwould be arrived at by
dividing the indexed ARR by the average actual traffic handled for the years 2021-2022,
2022-2023 and 2023-2024. The ARRBR will be the ARR per tonne/TEU multiplied by the
revenue share percentage as prescribed in the Concession Agreement.The ARRBRwill be
escalated annually applying indexation @60% of the annual WPIfor subsequent years. The
Royalty would be ARR based Royalty per tonne/TEU x actual Trafficor MGC/ MGT if
applicable, whichever is higher.
22.3 It is made clear that references to TEU above, includes all kinds of containers i.e.FEU,
Empty, Coastal, transhipment etc.
22.4 The rate of Royalty is provided in para 22.7.3. For any category of containers not
mentioned in para 22.7.3, the rate of Royalty would be in the same proportion as the Tariff
determined under the applicable Tariff Guidelines of the Project.
22.5 The above-mentionedARRBRand all other issueswould be worked/detailed out for each
Public Private Partnership Project (PPP Concessionaire)by a committee of experts appointed
by MOPSW.
22.6Indian Ports Association (IPA)or such other Authority as authorized by MoPSW will
publish the escalation factor (indexation@60% of the annual WPI) for the PPP
Concessionaires on a yearly basis.
Page 19 of 3022.7 All PPP Concessionaires shall maintain all documents and supporting evidence relating
to the details of cargo/ containers handled category wise, tariff charged and the amount
collected and submit to the MPA within 15th day of the following month duly certified by its
Internal Auditor/ authorized representative of PPP concessionaire. The MPA shall have the
option to verify and audit the quantity of cargo/ TEUs handled, tariff charged and amounts
of rates/ tariff received by the PPP Concessionaire.
22.8 For PPP Concessionaires, where there are existing policies of MOPSW for prescription
of concessional tariff for coastal cargo/ container, transhipment container, etc., the Per tonne/
Per TEU royalty/ revenue share payment for such coastal cargo/ coastal container,
transhipment container will be levied proportionate to that extent. The details are as follows:
-
22.8.1 Royalty rates for Coastal cargo/ Container entitled for Coastal concession in
tariff for PPP concessionaires under Royalty model:As regards coastal containers or
coastal cargo eligible for coastal concession in tariff as prevailing Government policy, the
tariff of the coastal cargo/ container, should not exceed 60% of the tariff applicable to
normal foreign cargo/ container. However, Royalty payable by the PPP Concessionaire to
the Concessioning Authority on coastal cargo or containers levied concessional tariff as per
policy guidelines of the Government shall be at 60% of the Royalty payable towards normal
foreign cargo/container.
22.8.2 Royalty Rates for Transshipment containers i.e. Foreign/ Coastal for PPP
concessionaires under Royalty model: The Royalty for transhipment containers shall be
concessional. Such Royalty shall be 1.5 times the Royalty for handling charges for the
normal handling operation in loading or unloading cycle. In case of transhipment of coastal
containers, the concession in handling charges prescribed above shall be calculated with
reference to the applicable handling charges (which are subject to the concessions specified
in clause 18.4 above) for coastal containers for the normal handling operation in loading or
unloading cycle.
Page 20 of 3022.8.3 For the PPP concessionaires which are under Royalty model, the royalty payment,
with reference to Para 22.8.1 and 22.8.2, is summarized below: -
If X is the Royalty payable by PPP Concessionaire for a Foreign Bound/Laden TEU, then
Royalty payable Containers of Containers of Containers of
Length upto Length above 20’ Length above 40’
20’ but upto 40’(FEU)
Foreign Bound/Laden X 1.5* X 2* X
Coastal Bound/Laden 0.6* X 0.6*1.5*X 0.6*2*X
Transhipment for 1.5*X 1.5*1.5*X 1.5*2*X
Foreign bound/laden
Transhipment for 0.6*1.5*X 0.6*1.5*1.5*X 0.6*1.5*2*X
Coastal bound/laden
Empty Foreign 0.8*X 0.8*1.5*X 0.8*2*X
bound/laden
Empty Coastal 0.6*0.8*X 0.6*0.8*1.5*X 0.6*0.8*2*X
bound/laden
Transhipment for Empty 0.8*1.5*X 0.8*1.5*1.5*X 0.8*1.5*2*X
Foreign bound/laden
Transhipment for Empty 0.6*0.8*1.5*X 0.6*0.8*1.5*1.5*X 0.6*0.8*1.5*2*X
Coastal bound/laden
22.9 In future also, in case any discount or incentives are mandated by MOPSW under any
applicable law to be applicable on certain types or natures of containers/cargo, the Royalty
payments for such container/cargo types handled by the PPP Concessionaires shall be
subjected to the same level of discounts.
23.0MANDATORY DISCLOSURES BY PPP CONCESSIONAIRES
23.1 All PPP Concessionaires shall furnish to respective MPAmonthly, quarterly and annual
reports on cargo traffic handled. For the container terminals, the PPP Concessionaire shall
furnish to the MPA quarterly/ annual reports on container traffic handled.
23.2 The quarterly reports shall be submitted by the PPP Concessionaire to the respective
MPA within a month following the end of each quarter. The Annual Reports and Audited
Accounts shall be submitted by the PPP Concessionaire, within 180 days following the end
of each of the financial year. Any other information which may be required by MPA shall
also be furnished to them from time to time.
Page 21 of 3024.0 UNADJUSTED PAST PERIOD SURPLUS/DEFICIT, PAST PERFORMANCE
ANALYSIS OF FIVE (5) PPP CONCESSIONAIRES GOVERNED BY ERSTWHILE
TARIFF GUIDELINES 2005/2019 AND OTHER PAST PERIOD DISPUTES
24.1 Litigations are pending in the High Courts on the disputes concerning the past Tariff
Orders passed by TAMP in case of the Scale of Rates of five the PPP Concessionaires viz.
NSICT & GTIPL at JNPA; CCTPL & CITPL at CHPA and PSA SICAL at VOCPA. The
surplus/ deficit over and above the admissible costs and permissible return, if any, arising
during the period of litigation till the revised SOR approved by erstwhile TAMP under the
Tariff Guidelines, 2019 came into effect will be subject to the orders of the respective
Courts.
24.2 Alternatively, concerned MPA and the concerned PPP Concessionaires may resolve the
disputes concerning the treatment of past period surplus/deficit arising during the period of
litigation mutually as per the Dispute resolution mechanism envisaged in the Concession
Agreement or any other applicable Legislation of the Government of India.
24.3 Provided further that, the above-mentioned tariff related disputes or any other tariff
related disputes of any nature which are pending prior to implementation of these Guidelines
may be resolvedby theconcerned MPA and the concerned PPP Concessionaires mutually as
per the Dispute resolution mechanism envisaged in the Concession Agreement or any other
applicable Legislation of the Government of India.It should be the endeavour of both MPAs
and PPP concessionaires that all legacy disputes are resolved at the earliest.
25.0 SUPPLEMENTARY CONCESSION AGREEMENT
25.1The PPP Concessionaires governed under erstwhile 2005, 2008, 2013 and 2019 Tariff
Guidelines as listed in Annexure-I, shall migrate to these Tariff Guidelines, 2025 subject to
the following:
(i)The PPP Concessionaire shall agree to unconditional acceptance of these Guidelines and
the provision of para 22 of these Guidelines.
Page 22 of 30(iii)The PPP Concessionaire shall be governed by the market determined tariff without any
financial consideration or change in other conditionsas per Concession Agreement.
25.2The concerned MPA and the PPP Concessionaire, shall agree on and execute a separate
Supplementary Agreement in writing, within a period of 60days of the notification of these
Guidelines, duly amending the respective Concession Agreement to the extent of provisions
of these Tariff Guidelines, 2025 and incidental matters.
26.0 SPECIAL PROVISIONS
26.1 Notwithstanding anything above, if there are any special provisions regarding tariff and
royalty payments in the concession agreement, the same shall be incorporated in the
Supplementary Agreement to be entered between the concerned MPA and PPP
concessionaire.
26.2 There are some Concession Agreements that do not provide for escrow account
mechanisms for depositing the revenues earned by the PPP concessionaires. In all such
cases,to maintain transparency in the revenue earnings, all receipts and expenditure, the PPP
concessionaire shall open escrow account similar to the one applicable for PPP
concessionaires under Model Concession Agreement 2021. The concerned MPAs and the
PPP concessionaire shall ensure to incorporate suitable provision in the Supplementary
Agreement in this regard.
26.3 It is further clarified that for the purposes of revenue, the PPP concessionaire shall
submit a revenue certificate and audited account statement at the end of the accounting
period.
(Issuing Officer)
Designation of Issuing officer
****
Annexure 1: List of PPP Concessionaire governed under the erstwhile Upfront Tariff
Guidelines, 2008, Reference Tariff Guidelines, 2013 and Tariff Guidelines, 2019
(erstwhile Tariff Guidelines 2005)
Page 23 of 30GUIDING NOTE
Mathematical formulation of the royalty payment system for PPP Concessionaires,
based on the text of Draft Tariff Migration Guidelines, 2025.
Core Variables:
● Royalty: The amount the PPP Concessionaire pays to the Major Ports Authority
(MPA). This is the primary value we're calculating.
● Actual Traffic (AT): The actual volume of cargo/containers handled by the
concessionaire, measured in tonnes, TEUs (Twenty-foot Equivalent Units), or
other relevant units.
● Minimum Guaranteed Traffic/Cargo (MGT/MGC): A pre-agreed minimum
volume specified in the Concession Agreement (CA). If actual traffic falls below
this, the royalty is still calculated based on the MGT/MGC, if applicable.
● ARR: Annual Revenue Requirement. A key component for some royalty
calculations, representing the revenue needed to cover costs and a reasonable
return.
● ARRBR: Annual Revenue Requirement Based Royalty per tonne/TEU. A derived
value used in specific royalty calculation scenarios for setting the floor of Royalty
payments.
● WPI: Wholesale Price Index. Used for annual escalation (indexation) of the
ARRBR.
● Revenue Share: A percentage of the concessionaire's gross revenue, as defined in
the CA, that is paid as royalty.
● X: A base royalty rate for a standard (foreign-bound/laden) 20' container. This is
the foundation for calculating royalties on other container types.
Formulas and Calculations:
Page 24 of 30The royalty calculation depends on how the royalty was originally determined in the
Concession Agreement. We have three main cases (22.2.1, 22.2.2, and 22.2.3),
and within each, sub-case, the final royalty is the highest value calculated
within the applicable sub-cases.
Clause (22.2.1) (Royalty Model where Royalty specified for full life of Concession
period)
1. Royalty Determined Per Unit/Tonne/TEU:
● (i) Royalty based on Actual Traffic:
Royalty = Royalty Rate Per Unit * AT
Where Royalty Rate Per Unit is the rate specified in the CA.
● (ii) Royalty based on MGT/MGC (if applicable):
Royalty = Royalty Rate Per Unit * MGT/MGC
The final royalty for 22.2.1 is: MAX of (Royalty(i), Royalty(ii))
Clause (22.2.2)
2. Royalty Determined Per Unit/Tonne/TEU with Escalation(Royalty Model
where Royalty specified in year 1 and then Escalation factor specified in
CA):
● (i) Royalty based on Actual Traffic with Escalation:
Royalty = Escalated Royalty Rate Per Unit * AT
Where Escalated Royalty Rate Per Unit is calculated using the escalation formula
from the CA. This formula is not provided in the text, but it would typically
involve a base year rate and an inflation index.
● (ii) Royalty based on MGT/MGC with Escalation (if applicable):
Royalty = Escalated Royalty Rate Per Unit * MGT/MGC
Page 25 of 30The final Royalty for 22.2.2 is: MAX of (Royalty(i), Royalty(ii))
Clause (22.2.3)
3. Royalty Determined as Revenue Share (In Revenue share Model):
This is the most frequent case, with different calculations based on the Original Tariff
Guidelines applicable to the concessionaire.
● (i) Royalty based on Actual Revenue:
Royalty = Revenue Share * Actual Revenue
● (ii) Royalty based on ARRBR (Annual Revenue Requirement Based Royalty):
This has two sub-cases based on the Tariff Guidelines:
○ (a) Tariff Guidelines 2008 & 2013:
1. Calculate ARRBR (for 2025-2026):
ARRBR 2025 = (ARR 2025 / Optimum Capacity) * Revenue Share
Where Optimum Capacity is from the TAMP order.
2. Escalate ARRBR for subsequent years:
ARRBR Year = ARRBR (Year-1) * (1 + 0.6 * (WPI Year / WPI(Year-1)-1))
Simplified to:
ARRBR Year = ARRBR (Year-1) * (1 + 0.6 * WPI Change)
Where WPI Change is the percentage change in WPI.
3. Calculate Royalty:
Royalty = ARRBR Year * MAX of (AT, MGT/MGC if applicable)
○ (b) Tariff Guidelines 2005 & 2019:
Page 26 of 301. Calculate Average ARR (2021-2024):
Average ARR = (ARR 2021-22 + ARR 2022-23 + ARR 2023-24) / 3
2. Escalate Average ARR to 2025-2026:
ARR 2025=Average ARR * Escalation Factor
The Escalation Factor will be as per TAMP.
3. Calculate ARR per tonne/TEU:
ARR Per Unit = ARR 2025-26 / Average Actual Traffic
Where Average Actual Traffic is the average traffic from 2021-2024.
4. Calculate ARRBR (for 2025-2026):
ARRBR 2025 = ARR Per Unit * Revenue Share
5. Escalate ARRBR for subsequent years (same as 2008/2013):
ARRBR Year= ARRBR (Year-1) * (1+0.6* WPI Change)
6. Calculate Royalty (same as 2008/2013):
Royalty = ARRBR Year * MAX of (AT, MGT/MGC if applicable)
The final royalty for 22.2.3 is: MAX of (Royalty (i), Royalty (ii))
Clause (22.8)(For Royalty Model cases):
Concessional Royalty Rates:
● 22.8.1 Coastal Cargo/Containers: Royalty is 60% of the royalty for normal
foreign cargo/containers. If X is the royalty for a foreign 20' container:
○ Coastal 20' Container Royalty = 0.6 * X
○ Coastal 40' Container Royalty = 0.6 * 1.5 * X
Page 27 of 30○ Coastal >40' Container Royalty = 0.6 * 2 * X
● 22.8.2 Transshipment Containers: Royalty is 1.5 times the royalty for a single
handling operation (loading OR unloading).
○ Foreign Transshipment 20' Container Royalty = 1.5 * X
○ Foreign Transshipment 40' Container Royalty =1.5 * 1.5 * X
○ Foreign Transshipment >40' Container Royalty = 1.5 * 2 * X
○ Coastal Transshipment: Apply the 0.6 factor before the 1.5 factor:
■ Coastal Transshipment 20' Container Royalty = 0.6 * 1.5 * X
■ Coastal Transshipment 40' Container Royalty = 0.6 * 1.5 * 1.5 * X
■ Coastal Transshipment >40' Container Royalty = 0.6 * 1.5 * 2 * X
● 22.8.3 Empty Containers:
* Foreign Empty 20' Container Royalty = 0.8 * X
* Foreign Empty 40' Container Royalty = 0.8 * 1.5 * X
* Foreign Empty>40' Container Royalty = 0.8 * 2 * X
* Coastal Empty: Apply the 0.6 factor before the 0.8 Factor
* Coastal Empty 20' Container Royalty = 0.6 * 0.8 * X
* Coastal Empty 40' Container Royalty = 0.6 * 0.8 * 1.5 * X
* Coastal Empty >40' Container Royalty = 0.6 * 0.8 * 2 * X
● Transshipment of Empty Containers
Foreign Transshipment Empty 20' Container Royalty = 0.8 * 1.5 * X
Foreign Transshipment Empty 40' Container Royalty =0.8 * 1.5 * 1.5 * X
Foreign Transshipment Empty >40' Container Royalty = 0.8 * 1.5 * 2 * X
Coastal Transshipment: Apply the 0.6 factor before the 0.8 and 1.5 factors:
○ Coastal Transshipment Empty 20' Container Royalty = 0.6 * 0.8 * 1.5 * X
○ Coastal Transshipment Empty 40' Container Royalty = 0.6 * 0.8 * 1.5 * 1.5 * X
○ Coastal Transshipment Empty >40' Container Royalty = 0.6 * 0.8 * 1.5 * 2 * X
● Future Discounts:
Page 28 of 30○ Royalty Payment = Discounted Tariff * (Original Royalty / Original Tariff)
Summary
This set of formulas defines a system where royalty payments are determined by
several factors, including the original concession agreement, actual or
guaranteed traffic, annual revenue requirements, and specific concessions for
coastal and transshipment cargo. It is a tiered system. The use of MAX ()
functions ensures the port authority receives the highest possible royalty based
on the applicable rules. The annual escalation using WPI ensures that the
royalty payments keep pace with inflation. The use of a base rate 'X' for a 20'
foreign container provides a consistent and clear basis for calculating the other
royalties.
*****
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