Biz Buzz: Smuggling… with a twist
Business owners and exporters beware: Smuggling—through the use of notorious Customs Bonded Warehouses (CBWs)—is making a nasty comeback.
This time, however, the old trick has a new twist. Corrupt customs officials and smugglers are apparently getting bolder and finding creative ways of luring key CBW employees to join the racket.
Newly installed customs officials recently uncovered the nefarious scheme where CBWs are used as cover for illicit trade.
Strictly regulated by the Bureau of Customs (BOC), CBWs are facilities established for Philippine-based manufacturers who are licensed to import tax- and duty-free raw materials or components on the condition that finished products would be exported within a prescribed period.
So-called “players” (a.k.a. smugglers), in cahoots with corrupt customs officials, are allegedly targeting unsuspecting owners of CBWs, who are kept in the dark while their names and/or facilities are used as conduits for smuggling.
According to BOC insiders, the modus operandi goes like this: Unwitting CBW owners are named “consignees” for items to be smuggled. On arrival, the goods are not really delivered to the CBW but diverted elsewhere. Supporting documents are counterfeit.
Case in point is a recent report about a P2-million shipment of glutinous rice that entered the Port of Manila early this month. While Customs officials hastily point an accusing finger against the alleged “consignee”—a CBW registered in the name of a garments exporter —there’s more than meets the eye with the shipment in question.
Biz Buzz sources inside BOC said the listed “consignee” could actually be the victim of a conspiracy between one of its CBW employees in cahoots with players and unscrupulous Customs officials.
The firm’s bitter experience should serve as a warning to the country’s more than 100 CBW owners to strictly monitor their facilities and staff lest they are victimized by smuggling syndicates. —DAXIM L. LUCAS
Filinvest vs Megawide again
After the fireworks on the Mactan-Cebu International Airport project (won by Megawide) and Clark International Airport (draw), the Gotianuns and the Megawide Construction group are again in a legal squabble, this time over the construction receivables/payables involving a high-rise construction project contracted at a time when they were still friends.
Megawide has claimed non-payment of about P800 million in receivables from completed construction work for Filinvest Land Inc. while the latter countered that it was Megawide which should be liable for liquidated damages amounting to P793.5 million plus another P72.24 million and other costs allegedly incurred by the property developer for “rectification works, takeover works, importations and other expenses.”
FLI claimed that Megawide had “abandoned and/or incurred substantial delays” in completing five projects of Filinvest Land’s subsidiary, Cyberzone Properties Inc. (CPI), explaining why the latter should be liable for liquidated damages. Megawide, for its part, complained that it had been trying to collect around P800 million worth of receivables for more than a year from these five mostly high-rise construction projects, which have been completed, turned over to FLI and were now occupied by homeowners.
“Pursuant to the parties’ respective agreements for these projects, for failure to complete the work on the agreed completion date pursuant to the respective notices of award, Megawide shall be charged with liquidated damages and the project owner has the right to deduct such accrued liquidated damages from any sum due Megawide,” FLI told the Philippine Stock Exchange.
Megawide, on the other hand, said there were time extensions approved during the implementation of the projects and that the new turnover schedule was “based on the approved extension and well within the new turnover schedule.”
The construction firm said the case had been referred to its legal counsel for “appropriate action” after several demand and follow-up letters.
FLI, on the other hand, cited its right to offset the amounts with Megawide’s alleged liabilities, with the deficit to be additionally paid by Megawide. “In any case, FLI and CPI are both ready to prove their right to payment before the proper forum,” FLI said. —DORIS DUMLAO-ABADILLA
Giant cement plant rising
The construction sector is abuzz about the looming establishment of what is being touted as the Philippines’ biggest cement manufacturing plant in Cebu, thanks to a joint venture between Century Peak Metal Holdings Corp. and China’s biggest cement manufacturing company, Anhui Conch Cement Co. Ltd.
According to those privy to the plan, the cement plant, once it becomes fully operational, will be able to supply 100 percent of the country’s cement needs, both public and private, for the—hold your breath—next 100 years. That’s an entire century, if true.
Yes, that’s how big the cement plant now being put on the drawing board is, especially with the joint venture between Century Peak and Anhui Conch seemingly already a done deal.
Century Peak is well positioned for this massive undertaking, with a net worth based on conservative valuation of about P16 billion even before this project with Anhui. It is a major player in local mining with its diversified mineral resource base.
Incorporated in 2003, Century Peak has six subsidiaries, namely Century Peak Corp., Century Peak Mineral Development Corp., Century Peak Cement Manufacturing Corp., Century Summit Carrier Inc., Century Hua Guang Smelting and Century Sidewide Smelting Corp.
Anhui Conch, on the other hand, is the biggest cement manufacturer and seller in mainland China. Its “H shares” were listed on the Hong Kong Stock Exchange in 1997 while its “A shares” were listed on the Shanghai Stock Exchange in 2002.
With this cement plant by Century Peak and Anhui Conch, we may be able forget about the ongoing wrangling in the cement industry and the secure supply of this primary raw material will surely put a smile on the faces of construction industry players. —DAXIM L. LUCAS
