BoC asked to investigate alleged smuggling in Cebu

MANILA, Philippines—Local manufacturers of steel products are complaining about the unabated incidence of technical smuggling allegedly in the Port of Cebu, with several cases of undervaluation of imported iron and steel products already reported to the Bureau of Customs (BoC).

In a statement issued Thursday, the Philippine Iron and Steel Institute (PISI) and its member-industry associations said the industry was “now starting to lose hope of getting a level playing field as local manufacturers are still not seeing any change in the unhampered smuggling of steel products.”

According to PISI, the group has already sent several letters to Customs Commissioner Rozzano Rufino B. Biazon, seeking the investigation of some import shipments passing through the Port of Cebu, where the government reportedly lost millions of pesos in uncollected taxes and duties.

PISI cited a letter dated Feb. 20, 2012, which was sent by the Philippine Galvanized Iron Wire Manufacturers Association Inc. (PGIWMAI) to Biazon.

According to PISI, the PGIWMAI had complained that a shipment of 5,995.72 metric tons of prime steel wire rod entered the Port of Cebu allegedly with Joyland Industries Corp. listed as the importer.

Joyland, PGIWMAI said, declared a value of $287 per MT, which was only 41 percent of the $700 per MT (FOB) legitimate wire rod importation value as of February 2012. This meant that for this particular shipment, the government failed to collect duties for the 59 percent of the import value, PISI said.

Further, the value declared was 30 percent below the price of steel scrap at $400 per MT, it said.

“Worse, the shipment came in two days after Biazon circulated to the different ports Customs Memorandum Order (CMO) No. 3-2012 dated Feb. 12 2012, which mandated that no imported iron and steel products whose declared FOB value is lower than $400 per metric ton should be processed or released without first securing clearance from the Office of the Commissioner,” PISI said in a statement.

“Despite the voluminous letters we sent you, and your new memorandum order, Joyland continues to import under the same scheme and enjoy its benefits while the government is losing hundreds of millions of pesos in uncollected taxes,” the group added.