K

RITIKO
Volume 4 Edition 4 January 2012

Restoring Confidence Crucial to Rebuilding World Recovery

INJURY TO THE FREEDOM OF THE PRESS

@ THE BUREAU OF CUSTOMS

DISSECTING IMPORT SMUGGLING

Imported Pork: MAV2012 worth Php4.2Billion

QUESTIONABLE IMPORTS

Php159.1M in Uncollected Taxes on Imported Pork?

K
DISSECTING IMPORT SMUGGLING

RITIKO
Volume 4 Edition 4 January 2012

Restoring Confidence Crucial to Rebuilding World Recovery

INJURY TO THE FREEDOM OF THE PRESS

@ THE BUREAU OF CUSTOMS

Imported Pork: MAV2012 worth Php4.2Billion

QUESTIONABLE IMPORTS

Php159.1M in Uncollected Taxes on Imported Pork?

KRITIKO

Volume 4 Edition 4 January 2012

COVER STORY

Injury to the Freedom of the Press @ the BoC

Press freedom is nothing with nothing to write. To prevent a person from gathering facts in public offices restrains that person from exercising that sacred right of the Liberty of the Press, the highest among the tier of rights.

Nineteen

press and media practitioners, as well as two associations in the Bureau of Customs filed a Petition for Prohibition (GR No. 199479) in the Supreme Court last December 15, 2011. Respondent of the case is Commissioner Rozzano Rufino B. Biazon of the Bureau of Customs. According to the Petition, The Bureau has issued Customs Memorandum Order No. 37-2011 that implements an accreditation procedure that actually works to limit or prevent the access to the facts and information that are found inside the BoC offices. These data are undisputedly matters of public interest. But this memorandum circular limits or prevents the petitioners from these matters. Tied intricately to the right to public information and the freedom of the press is the principle of the 1987 Constitution that says: Public Office is a Public Trust. It has never been public office is a private trust. The offices inside the zone of the BoC have never been a private trust. They belong to the publics trust. In ratifying the 1987 Constitution from where the BoC got its authority to exist, the people gave their implied trust that the persons who would be appointed to run the Bureau would take care of the offices inside it. The petitioners are seeking the Write to strike down the questioned memorandum, the Writ to enjoin the Bureau from implementing the same memorandum. They are also seeking the Courts succor by issuing urgently a Temporary Restraining Order to enjoin the Bureau from implementing the same memorandum while the petition is being heard.

Locus Standithe right to bring an action

1st.
This is a first time to happen that journalists question a memorandum of a public office seeking to require first accreditations before allowing them to exercise their freedom of the press.

2nd. 3rd.

The issue affects the exercise or the norm of press freedom not only of the present generation but also the generations to come. The petitioners are all directly affected. The memorandum will directly limit their access to matters of public interest that can only be found in the various offices of the Bureau of Customs.

Salient features that adversely affect

1. The administration or implementation of the memorandum is being tasked to the Chief of the Public Information & Assistance Division (PIAD) of the BoC; 2. The requirements of accreditation that are only required from entities applying for business permits, which requirements are not reasonable for the petitioners who are not doing business but public service. 3. The requirement from reporters, writers and photographers documents and other matters that only add difficulty for the petitioners to cover or gather facts. 4. The requirement for columnists to get first visitation pass from the PIAD before they are allowed to enter the BoC and conduct media rounds, but they are also required to submit documentation that they are on assignment. 5. The requirement that the petitioners must agree to Terms and Conditions fixed by the BoC as if treating the matter freedom that does not give any gain as an ORDINARY CONTRACT between parties, including therein interviews to be pre-arranged first with the PAD, prohibition of loitering without a pass from PIAD, and the information obtained shall be used only on a bona fide news reporting tantamount to dictating how and what to report or publish. 6. The provision allowing the Bureau to revoke or cancel accreditations on perceived violations that are inherently press freedom issues. 7. The setting up of procedures by which accreditations will be obtained. 8. The making of the memorandum effective immediately and without any publication. Allegations further states that, in the guise of making it legal, the chief of PIAD, Lenny Abao, consulted the week prior, some of the petitioners upon the pretext that their views were solicited. The petitioners suggested the removal of all those difficult requirements as their way of compromising although they knew that any form of memorandum is an abridgement of press freedom. The petitioners were only shocked upon receipt of photocopies of the memorandum and to be told that the same shall be fully implemented. All suggestions were summarily rejected.

Volume 4 Edition 4 January 2012

KRITIKO

A grave abuse of discretion. A lack or excess of jurisdiction

The petition alleges that a matter of press freedom cannot be abridged as sacredly protected by the Constitution when it pronounces: NO LAW SHALL BE PASSED ABRIDGING THE FREEDOM OF EXPRESSION, OF SPEECH, AND OF THE PRESS That directive of the Constitution is directed against the Congress of the Philippines. Now, if the Congress that has the virtually unlimited power to make all kinds of laws, is prohibited, how much more for an agency or a bureau like the Bureau of Customs? The memorandum issued that is actually being implemented setting forth requirements has the legal effect of a law. This is because the BoC is now implementing its provision promulgated by the Customs Commissioner and it actually limits the rights of the petitioners as daily or regular practitioners of the liberty of the press. This is because it is censorship. It is a prior restraint to the exercise of the liberty so dearly fought for with blood by the forefathers. Imagine alone the provisions of the memorandum that requires of the petitioners to submit documents like they are applying for business permits when all they have been doing and intend to do inside the BoC have not been for private businesses, not been to gain from the imports, not been to be brokers, but solely to be able to get information that they need to cater the public need. Imagine also that the memorandum requires the petitioners that the publication must at all times be compliant to the Philippine Journalists Code of Ethics. If Congress cannot do this, how much more for the Bureau of Customs? This amounts to legislating the Journalists Code of Ethics into a law of the land when it is only a code agreed upon among all journalists only, a private undertaking. Imagine also the requirement to make pre-arrangements before they can interview any Customs official. It is very sure that the matters to be asked are matters that belong to the sphere of public trust. So what is the authority of the Bureau to be the lawmaker on this matter that belong to the sphere of the public? Allowing the Bureau to do away with this set up will allow the Bureau officials to hide their misdeeds and allow them to protect them at the same time successfully by implementing this censorship. The fact alone that the Bureau would have the advance knowledge who should be interviewed will give its venomous officials a time to implement controls to suppress the mouths that would speak the truth. Imagine also that the same memorandum requires that all information that would be gathered should only be used for bona fide news reporting. Does this mean that news reports about shenanigans are not bona fide? The same memorandum doe not define what is bona fide and what is not. This is therefore clearly intended to suppress bad press. Imagine also the requirement of reporters, writers and photographers to make them apply as if they would sell goods on the sidewalks of Divisoria or be one who be allowed to exercise a profession when to exercise press freedom is a vocation and not a profession. Imagine also that the memorandum is to be implemented by the BoC through its PIAD office to make it as the hatchet man against the press. The intended discovery of errant officials being targeted for site inspections or detective journalism works or interviews would not happen due to prior knowledge. The harshest of all, the memorandum makes the Bureau of Customs as a Quasi-judicial body or a judge to hear and decide Press Freedom issues against petitioner if ever they are accredited. This is very clear to be a usurpation of the powers of the Congress. It has converted itself into a court and judge for the journalists they accredited. More so, it is like giving it the power to penalize or punish press freedom practitioners for news reports published not the liking of the officials of the Bureau. Hence, what is happening now at the Bureau of Customs, is that it is now a Martial Law Zone suppressing press freedom.

Excerpt: CMO No. 37-2011 Subject: Guidelines on the Accreditation of BoC Media Practitioners
III.1 Requirements for Accreditation (a) Publication Completed Application Form; Certified True Copy of SEC Registration, Articles of Partnership/Incorp., By-Laws & latest Genl. Info. Sheet ; CTC of DTI Registration ; CTC of Mayors Permit ; CTC of BIR Certificate of Registration ; Certificate of Reg. to Publishers Association of the Phils., Inc. ; Proof that the publication has been in circulation for at least 6 months. Proof that the publication has a weekly circulation of at least 3,000 copies

4
IN THE NEWS

KRITIKO

Volume 4 Edition 4 January 2012

World Economic Forum

Restoring Confidence Crucial to Rebuilding World Recovery

restoring confidence in both Europe and globally is crucial to protecting the battered international financial system and rebuilding the ailing recovery, threatened particularly by strains within the euro zone, panelists at a discussion on the global economic outlook said in Davos. According to IMF Managing Director Christine Legarde, No one is immune in the current situation. Its not just a euro zone crisis. Its a crisis that could have collateral effects, spillover effects around the world. To get beyond the crisis, Europe must address three key issueslack of growth, reduced competitiveness, and the need for greater integration. To restore confidence more immediately, the euro zone must develop a strong firewall to protect its members. It is critical that the euro zone members actually develop a clear, simple, firewall that can operate both to limit the contagion and to provide this sort of act of trust in the euro zone so that the financing needs of that zone can actually be met." In addition, the IMFs resources should be built up to help protect other countries around the world. The aim, she said, is to build up a big enough contingency fund that will help restore confidence and therefore it wont have to be used. Lagarde is trying to ramp up the IMFs resources by up to $500 billion so it can help if more lending is needed in Europe or elsewhere. She stressed that the money is not just to support Europe, but any country that is a member of the IMF, particularly in central and eastern Europe, and poorer developing countries. Tailor made She clarified that there was not a one-size fits all solution in the current crisis. Efforts to reduce budget deficits and debt must be tailored to the situation in each country as consolidating too quickly could strangle growth. We are not suggesting that there should be fiscal consolidation across the board, without differentiation and without specific treatment adjusted to the specificities of the country, Lagarde noted. In the context of discussing the IMFs broader position on fiscal policy, she set out three main country groupings those with no choice but to adjust debt levels and spending now, those with room for flexibility, and those who have the option to stimulate growth further, and thereby help other economics. The IMF has said that the euro zone countries are expected to fall into a mild recession this year.

Rapidly

Overall, activity in the advanced economies is now projected to expand by just 1.2 percent in 2012a downward revision of percentage points relative to the forecast last September. Lagarde said that in addition to Europe, the United States and Japan needed to adjust their large deficits, while major emerging markets should work to develop domestic consumption. Panelists included Ali Babacan, Turkeys Deputy Prime Minister for Economic and Financial Affairs, Mark J. Carney, Governor of the Bank of Canada, Japans Economy Minister Motohisa Furukawa, George Osborne, Chancellor of the Exchequer of the United Kingdom, Donald Tsang, Chief Executive of Hong Kong Special Administrative Region, and World Bank President Robert B. Zoellick. Decisive action a must for confidence Osborne said the world should give the euro zone credit for all that it has achieved in the past two years, in terms of reducing budget deficits, creating the European Financial Stability Facility and introducing structural reforms. But there was much more to do. "The fact that we're still, at the start of 2012, talking about Greece again is a sign that this problem has not been dealt with," Osborne said. "The danger here is that the tail wags the dog throughout this crisis the inability to deal with the specific problems in the periphery causes shockwaves across the whole European economy and the world economy." All panelists agreed that restoring confidence was critical for shoring up the system. "You need decisive action. You need overkill, said Tsang, the chief executive of Hong Kong. Confidence must come from decisive actions from governments." Worrying outlook In his introduction, Wolf said that the mood in Davos was akin to the relief of a condemned man reprieved from hanging. Instead of feeling the imminent prospect of catastrophe, there is a sense that things have been done that have eliminated very substantially the immediate risk of disaster, particularly in Europe. Concern about unemployment is part of the bigger issue that some of us have been trying to draw out, which is that its not enough to muddle through, he added. There should be concerted efforts to undertake structural reforms that reduce impediments to growth, and specific measures to support skills and employment.

Volume 4 Edition 4 January 2012

KRITIKO

DISSECTING IMPORT SMUGGLING

Imported Pork: MAV2012 worth Php4.2Billion

In the News
According to the Department of Agriculture: the country may experience a shortage in chicken and pork, in the first half of 2012, as demand is expected to outpace supply. According to the Livestock and Poultry Information and Early Warning System Project: A deficit of 47,590 metric tons for pork is expected, in the second quarter of 2012. In the DoAs published 2012 BYP Qualified Minimum Access Value (MAV) Licensees and their Tentative Allocations, a total of 22,406 metric tons will be allocated to over 114 importers of Pork. While a total of 54,210 metric tons of Fresh, Chilled and Frozen Pork has been determined as the allowable volume of importation for the livestock.

Actual Importations
During the period of July to December 2011, and based on Kritikos available research data, some 90 containers by 30 importers/consignees shipped various parts of pork products into the country. Of the surveyed importing companies, only 25 have the MAV 2012 allocations. While 5 importers were able to bring into the country some 7 units x 40ftr containers without having the MAV issued to their companies. At taxable rates of pork/hog (30%) + value added taxes (12%), an estimated total tax per container should have been Php1,890,000 each. Based on our computations, a total of Php170,100,000 (or Php170.1million) should have been collected by the Bureau of Customs. However, actual taxes collected for the 90 containers was only Php10,929,152. Therefore, the BoC failed to collect some Php159,170,843 (or nearly Php159.2million) in taxes on the imported pork. Assuming a 50% discrepancy rate on this study, the deficit would be a minimum of Php79,585,421.50 in uncollected taxes by the BoC. This discrepancy in 90 containers vs. allowable importations with the MAV represents only 5% of the total containers permitted.

Dissecting the MAV on Imported Pork

The total minimum access volume for imported pork, once converted to kilograms, would mean that some 54,210,000 kilograms of pork may enter the country this year. An adult pig/hog weighs between 300lbs. to 500 lbs. If the average is 400lbs. = 182 kilograms (converted), then some 297,858 heads of hogs will be slaughtered for our eventual consumption. At an average of Php180/ kilo in the market, this would mean a total Market Value of Php 9,757,800,000 (an estimated Php9.7 billion worth) of pork. The average assessed import value, if at 30% (ACFTA) should bring in some Php 2,927,340,000 (or some Php2.9 billion) for collection by the Bureau of Customs for 2012 on pork alone. If we estimate the value added tax for importation at 12%, this should translate to Php1,170,936,000 (or some Php1.1 billion) in VAT. In terms of volume of importations, this means an estimated 2,170 units of 40 footer containers is expected to enter the country for the year. Note that the allocation per importing company varies.

Shipment frequency estimates

Assuming that such import shipments arrive at different times: 2,170 units divided by 6 times (frequency) = some 362 units of 40-footer containers may enter the country every other month. Which translates to: 362 units/month x 25,000kgs./ container = 9,050,000kilograms of pork x Php180 market price = Php 1,629,000,000 Market Value. If assessed conservatively by the Bureau of Customs, this means that at least Php488,700,000 in import taxes + Php195,480,000 in VAT = Php684,180,000 (or some Php 684.1million) in total tax every 2 months on imported pork would be collected. This represents those importers with the MAV Pork allocations only.

Conclusions:
The Bureau of Customs failed to collect some Php80 million in taxes for 90 actual container shipments in 2011. This represented only 5% of the allowable 2,170 units under the MAV 2012 allocation. While at least 5 importers without the MAV allocations were able to bring in imported pork. While the Dept. of Agriculture aims to answer their forecasted pork deficit for 2012 via the issuance of the minimum access volume, the Bureau of Customs, having failed to collect proper taxes from 5% of the total shipments allowable can actually defeat the purpose of government should they continue to fail to collect for the remaining 95% of other imported pork shipments for the total tentative MAV allocations of 2012. The total taxes that should be collected by the

Bureau of Customs for the MAV 2012 allocations of 54,210 metric tons of pork should be Php4,098,276,000 (or Php4.1 Billion).

6
BENJIE REBUENO JR.

KRITIKO
Bureaucratic Style Governance
As part of our Customs?

Volume 4 Edition 4 January 2012

The impeachment trial of the Chief Justice of the Supreme Court is ongoing at the Senate of the Republic of the Philippines. The filing of smuggling cases are ongoing at the Department of Justice by the Bureau of Customs Run After the Smugglers group. The justices of the Supreme Court are still doing their job descriptions accordingly. The Malacanang spokespersons are always on their denial mode during pronouncements especially on the subject of their insolent behavior and denials on the matter of public persecutions. Are these truly part of our customs?

Send smugglers to Jail

The Bureau of Customs director general came out with a pronouncement to send smugglers to jail after he expressed frustration over procedure delays and pending resolutions of cases against smuggling. Are you kidding me?! The Customs commissioner must be reaching for the stars! He must first keep his feet on the ground. Ok, for the sake of discussion, how do you propose to do that when you cannot even put a single Customs employee in jail? And you will go after the big-time players or smugglers? While there is nothing wrong with big dreams, putting your plans into action is another scenario all together. Good luck? Oh, by the way, in case youre interested, would those players be the likes of Mr. Money Santos? Ms. Tina You? Mr. Musso? Mr. Tolentino? Mr. Wong, Mr. Lee, Mr. Logarta of Cebu? Ms. Reyes? Or Ms. Layug? Heck, Im not even scratching the surface of the list! According to our invincible source, a lot of shipments that had allegedly arrived last December are now at the Port of Manila and the Manila International Container Port. That the shipments are loaded with contraband goods of highly dutiable values. According still to our source, the reason why a lot of the containers are arriving just now is because the shipping company did not allow them to proceed to its destination. This is because a lot of vacant space in the cargo section of the ship is still available. Heres a grim reminder of world economics during its worst scenario. We have a president who wants us to tighten our belts and not spend a single cent of the government budget on his first year in office. We also have a Customs commissioner who had concentrated on the anti-smuggling drive that he forgot that his job description and main agenda is to collect for the government so the latter can expedite its basic public work, projects and services. By golly, the agenda of this administration can get so showbiz mismo!

The Import Permit (IP) of 10 reefer containers of Chicken Wings and Chicken Fillet was USED without the knowledge of the consignee. In the course of my investigation of this shipment, the name of MOFELS and JADE BROS. as consignee and broker (respectively) were being mentioned. Wonder why? In another case, 15 reefer containers now at the Manila International Containers Port is on HOLD for violations of the Tariff and Customs Code of the Philippines (TCCP) and the Bureau of Animal Industries (BAI) guidelines on Mackerel importations. Again, the name of MOFELS FOOD INTL. CORP. came about. A certain Chito or Dante claiming to represent JADE BROTHERS and MOFELS was also mentioned. Why? The said shipment of ten (10) containers of CHICKEN at the Port of Manila apparently do not have their Minimum Allocation Values (MAV) and their Import Permit is questionable. Now, lets look at the people inside the Bureau of Customs. Mr. Mel Pascual of the Formal Entry Division: I hope you will look into this importation and find out if MOFELS and JADE BROTHERS are really involved in these said shipments? Or are their names just being dropped for misdirectional purposes?

The MACKEREL importation at the MICP is on the ALERT list of the Enforcement and Security Services of the BoC. About three containers, out of the 15 containers whose Import Permit is under strict scrutiny of the Deputy District Commander of the ESS. Mr. Ditona, whom I heard gave a strict condition prior to the processing of the documentations of the said shipment of Mackerel, which aside from the showing of the Import Permit, requires a Letter of Authentications signed by the Director of the BFAR? The shipment of frozen sardines is totally out of the regular system of importation. Why? First, there are three (3) previous consignees named - all of whom DENIED the said importations. That these are not their shipments!? Now it would seem that nobody wants to face the music. Or is it the firing squad. So to speak, MOFELS denied owning the shipment of Mackerel. Even after the ALERT ORDER was issued to them by the ESS of MICP. The CITIPHIL FORWARDERS also denied the Mackerel shipment. JADE BROS. also denied those shipment of Mackerel. Hence, the Chief of Section 1-A of the MICP should be able to answer my queries. A certain MIKE LIM, who came forward claiming to be the rightful owner of the said Mackerel shipment, is now moving like a twisted eel and is hell bent on finding out what really happened to his importations. He can blame his brokers aka. Smugglers.

Volume 4 Edition 4 January 2012

KRITIKO

IN BRIEF :

SENATOR ANTONIO TRILLANES IV

All references point to impeachment as political process

n order to guide him on how he should eventually make a decision, Senator Antonio Sonny F. Trillanes IV said he researched on the true nature of impeachments, focusing on the US version of the impeachment that is a virtual copy of our own. True enough, what I found out was, there is not a single book or reference I encountered that says that impeachment is a judicial trial solely based on evidence. To the contrary, all of these references defined or referred to impeachment as a political process. Trillanes cited numerous books and references to justify the point that the impeachment process is a political process, such as Alexander Hamiltons Federalist No. 65, Matthew J. Francks The Supreme Court and the Politics of Impeachment and Charles Gardner Geyhs When Courts and Congress Collide:The Struggle for Control of Americas justice System. Trillanes said the impeachment trial of Supreme Court Chief Justice Renato Corona should be treated as a political process where the parties are expected to battle for public opinion and political acceptability. Trillanes, one of the senator-judges in Coronas trial, said he wont decide based purely on the evidence that the prosecution and defense panels will present but on the basis of what would be best for the country. Having established that impeachment is a political process, therefore, my verdict should not be based solely on evidence as it now becomes a matter of public policy. And the over-arching policy issue in this whole impeachment episode is whether the conviction or acquittal of Chief Justice Renato Corona would be good for our country. To resolve this, I intend to use political acceptability as the sole criterion to evaluate the projected outcomes of either policy alternative of conviction or acquittal. This does not mean the evidence should be completely disregarded, noting that the strength or weakness of the evidence, and how they are presented could very well affect the political acceptability of either policy alternative. Having said this, it would help if the prosecutors and defense counsels would not to be too technical in their presentations. Ultimately, they would have to win the hearts and minds of the people. In determining political acceptability, Trillanes said he intended to use policy research tools as such as quantitative and qualitative researches and stakeholder analysis and extensive consultations. He said both methods could very well filter the noise of the mob and undue media influence from the true will of the people.

His position runs counter to that of most distinguished lawyers, political analysts and opinion columnists who said that just like in any other judicial trial the judgment on Coronas impeachment case must be determined solely by evidence. He cited the impeachment trial of former United States President Bill Clinton, who was acquitted by the Senate dominated by his Democratic allies despite overwhelming evidence that he committed perjury and obstruction of justice. In the Philippines, Trillanes said the fact the power to impeach was given to Congress, and not to the Supreme Court, made the entire process political. Moreover, if an impeachment trial were meant to be solely evidence-based, then why didnt our constitutional framers just give that power to the Supreme Court whose members are supposed to be experienced judges? The senator also struck down the proposal to conduct a referendum to find out the pulse of the people on the impeachment case against the countrys chief magistrate. He said the senators, as representatives of the people, were entrusted with the authority to decide on our own what is in the best interest of the public. Our country is not a direct democracy. We are, in fact, a representative democracy wherein the people indirectly govern their country through elected representatives. It is the representatives discretion whether to consult his constituents or assume that he is omniscient. More importantly, referendum is not the procedure stated in our Constitution. (by Josephine delos Santos)

8
RJA

KRITIKO

Volume 4 Edition 4 January 2012

A Mad Scramble
frenzied jockeying for positions in the Bureau of Customs has begun. Truth to tell, the lobbying started way before Christmas 2011. It started when Commissioner Ruffy Biazon assumed office. Most key people in the Bureau of Customs realize the importance of being early birds. Even before Christmas last year, talk was rife about an impending rigodon. Most recently, most customs observers are betting their last centavo on Boysie Belmonte to the Collector of the Port of Manila, Ronnie Silvestre as the new MICP Collector, Lina Molina at NAIA, Rogelio Gatchalian for Cebu. I have no idea how those people got their information. Then again, the talk could be a trial balloon. The administration could be seeking a path of least resistance for its reform agenda and would not want to unduly ruffle feathers. Remember that Gatchalian is an Enrile protg, Boysie is the brother of the Speaker of the House, Ronnie is a classmate of the Executive Secretary, Ding is perceived as close to the INC, and Lina has her own network. By now, Commissioner Ruffy must have realized that half of being Commissioner is catering to the diverse interests permeating the customs bureau. Close as he is to the President, prudence dictate that he also attend (not necessarily kowtow) to the different patrons of customs officialdom. While he is not vulnerable now, he could be tomorrow and in politics, the more allies one has, the better chances of survival. Politics, as they say, is addition. Having said that, there are signs that the Commissioner doesnt want to be left with a rotten egg. This week, the customs media came out with a spin on the beaten issue of the missing containers. Our Commissioner, media proclaimed, wants smuggling as a heinous crime. As a logical step, a total of 16 officials involved in the case of the missing 1,920 containers are about to be criminally charged, the media mills triumphantly trumpeted. The latter piece is a bit of an over spin because this is an instance when no charges has been file yet against the 16 personnel, but already it is newsworthy. Why, I do not know. I believe the proper treatment is that customs has not yet charged anyone for the missing containers after almost a year investigating the scam. The mention of the 16 officials to be charged is obviously meant to lay the framework of the reshuffle of personnel. The logic it seems is that Commissioner Ruffy has to make reassignments for administrative efficiency. Nature abhors a vacuum. Commissioner Ruffy also has to contend with the imperious wishes of the Secretary of Finance. Any changes in the assignments at the level of the District Collectors are approved by the Secretary of Finance. Rightly or misguidedly, subsuming the organizational needs of the Bureau of Customs to the subaltern of the President is the standard practice.

As predictable as clockwork, the

The Commissioners men should also be acceptable to the Secretary of Finance. While this additional bureaucratic layer is supposed to ensure the survival of the competent, in reality this only ensures that only the anointed ones are given the lofty and, should I say, juicy positions in the Bureau of Customs. With the Secretary of Finance looking down on the personnel matters of the Bureau of Customs, life, to those with nothing except merit, becomes doubly hard. Hirap na nga marecognize sa Bureau, lalong hirap maka penetrate sa Department of Finance. Paano yung walang direct line kay Godzilla?

Volume 4 Edition 4 January 2012

KRITIKO

QUESTIONABLE IMPORTS

Php159.1M in Uncollected Taxes on Imported Pork?

The importation of Pork between the months of July to December 2011 is the subject of our questions in this edition. The relevance of which lies in the recent publication of what the Department of Agriculture calls the minimum access values - where specified business entities are named in the MAV and are therefore authorized to import pork in either fresh, frozen and chilled forms. Our feature on Dissecting Import Smuggling delved on the general effects of the MAV on the local industry, in relation to the functions of the Bureau of Customs. This bureau exists to ensure fair tax collections and enforcements against import smuggling. Any failure on their part to collect the right taxes, enforce the laws and prevent corruption will have a direct effect on governments revenue generation efforts. The end product of such failure will always affect the people. Importers/Consignee QTY. & Origin Tax Paid Entry Importers/Consignee QTY. & Origin Tax Paid Entry
C140169 C139035 C139038 C139066 C139216 C139253 C120371 C119381 C119693 C138709 C138716 C138719 C138721 C138746 C139279 C120637 C119372 C119374 C119378 C118143 C119734 C118194 C118803 C139088 C119760 C118164 C119997 C120005 C117971 C138607 C138634 C138686 C138710

Oro Campo Trading 1 NL Php 52,321 C71396 (MAV 2012= 550MT = 555,000 kgs. = 22 containers) First Crocus Phils. Inc. 1 CA Php191,222 C114953 (MAV 2012 = 400MT = 400,000 kgs. = 16 containers) Puro Carne Intl. Inc. 1 US Php224,000 Puro Carne Intl. Inc 1 US Php224,000 (MAV 2012= 750MT = 750,000kgs. = 30 containers) Mofels Foods Intl. Corp. 1 DE Php 61,101 C117518 (MAV2012= no allocation) The Purefoods Hormel CI 1 DK Php 69,716 C120025 The Purefoods Hormel CI 1 DK Php 69,785 C120048 The Purefoods Hormel CI 1 US Php 65,505 C137578 The Purefoods Hormel CI 1 CA Php 44,393 C209007 The Purefoods Hormel CI 1 CA phP 62,057 C209025 (MAV2012=182MT = 182,000kgs. = 7.28 containers ) VWA Food Processing 1 FR Php 28,475 C120895 (MAV2012 = no allocation) Nueva Foods Corp. 1 DE Php250,842 C119985 Nueva Foods Corp. 1 US Php283,465 C120997 Nueva Foods Corp. 1 US Php 54,467 C118174 Nueva Foods Corp. 1 US Php236,817 C138692 Nueva Foods Corp. 1 US Php236,817 C138692 Nueva Foods Corp. 1 FR Php274,631 C139023 Nueva Foods Corp. 1 CA Php272,082 C139437 Nueva Foods Corp. 1 NL Php268,962 C139456 Nueva Foods Corp. 1 US Php 53,911 C139470 (MAV 2012 = 4,093MT = 4,093,000kgs. = 163.72 containers) Jcore enterprises 1 FR Php 60,853 C120968 Jcore Enterprises 1 AU Php 36,390 C117993 Jcore Enterprises 1 FR Php 57,182 C118000 Jcore Enterprises 1 CA Php 54,828 C118024 Jcore Enterprises 1 CA Php 44,683 C118032 (MAV 2012 = 50MT = 50,000kgs. = 2 containers ) All Meat Food Intl Trdg. 1 US Php 54,480 C117434 All Meat Food Intl Trdg. 1 FR Php 51,315 C120185 All Meat Food Intl Trdg. 1 FR Php 51,315 C119378 All Meat Food Intl Trdg. 1 US Php 55,260 C118039 All Meat Food Intl Trdg. 1 US Php 55,260 C118043 All Meat Food Intl Trdg. 1 US Php 53,987 C118047 All Meat Food Intl Trdg. 1 US Php 53,998 C118065 All Meat Food Intl Trdg. 1 US Php 63,964 C118073 All Meat Food Intl Trdg. 1 CA Php 45,250 C118088 All Meat Food Intl Trdg. 1 IE Php 33,968 C118095

All Meat Food Intl Trdg. 1 IE Php 46,526 All Meat Food Intl. Trdg. 1 FR Php267,927 All Meat Food Intl. Trdg. 1 DK Php 55,902 All Meat Food Intl. Trdg. 1 ES Php 52,672 All Meat Food Intl. Trdg. 1 ES Php 52,050 All Meat Food Intl. Trdg. 1 DK Php 53,851 (MAV 2012 = 250MT = 250,000kgs. = 10 containers ) MPP Meat Import Corp. 1 FR Php289,067 MPP Meat Import Corp. 1 FR Php 57,038 MPP Meat Import Corp. 1 FR Php280,989 MPP Meat Import Corp 1 SPAIN Php 75,042 MPP Meat Import Corp 1 GERM Php 28,464 MPP Meat Import Corp 1 CA Php 37,156 MPP Meat Import Corp 1 NETH Php 78,010 MPP Meat Import Corp 1 SPAIN Php 74,841 MPP Meat Import Corp 1 FR Php268,894 (MAV 2012 = 18MT = 18,000kgs. = 1 container ) Mekeni Food Corp 3 CA Php 93,865 (MAV 2012 = 1,300MT = 1,300,000kgs. = 52 containers ) WB Prime Choice Corp 1 FR Php268,359 WB Prime Choice Corp 1 FR Php266,877 (MAV 2012 = 54MT = 54,000kgs. = 2 containers) Mother & Daughter MS 1 FR Php257,159 Mother & Daughter MS 1 US Php 64,153 (MAV 2012 = 700MT = 700,000kgs. = 28 containers) North Star Meat Merchants 1 CA Php 56,535 North Star MMI 1 FR Php254,355 North Star MMI 1 NL Php290,747 North Star MMI 1 CA Php 31,898 (MAV 2012 = 550MT = 550,000kgs. = 22 containers) Lucky Sales Trdg 1 DE Php 53,879 (MAV 2012 = 50kgs. = 50,000kgs. = 2 containers) Lean Pasture Trading 1 CA Php 28,332 (MAV 2012 = 200MT = 200,000kgs. = 8 containers) First Maestro Food SC 1 US Php196,548 First Maestro Food SC 1 US Php198,328 (MAV 2012 = no allocations) Enzed Trading 1 CA Php 67,138 (MAV 2012 = 36MT = 36,000kgs. = 1.44containers) Sacrecoure Comml 1 CA Php 54,710 Sacrecoure Comml 1 US Php 55,024 Sacrecoure Comml 1 SWITZ Php 54,098 Sacrecoure Comml 1 US Php 54,830 (MAV 2012 = no allocation)

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RICKY CARVAJAL

KRITIKO

Volume 4 Edition 4 January 2012

News & Issues sa Customs for 2012

Happy Chinese New Year po, sana nagging pakipakinabang an gating mga nagging isyu for the past year. Ayon sa mga pahayagan sa Bureau of Customs, ay mananatili sina Commissioner Biazon at Depcom Lim sa agency. Biazon will stay focused on his job, kahit hirap ang BoC to reach the revenue collection target and to prove na kaya nitong ibangon ang collection for the year 2012. And iba naman ay nagsasabing siya ay tatakbo muli sa susunod na election. Ano na nga ba? Remember one billion a day na po ang assigned target collection for this year.

Acting Capacity?
Si Atty. Juan Lorenzo Tanada ang bagong Deputy Commissioner for Internal Administration ng BoC. Ang tanong ko lang naman kay Atty. Tanada ay kung may alam siya tungkol sa mga kawani ng customs na under Acting Capacity na tinatawag. Sila ay mga kawani na nilagay sa isang puwesto na hindi kanila and they belong to other mother units placed thru a request by some political leaders for a position sa mga ibat ibang pantalan and division ng bureau. Most affected dito ay ang mga may plantilla position dahil instead na sila ang makinabang sa puwesto ay nailalagay. Sir Juan, matagal na ang sistemang ito na nangyayari. Ang usapan nga dito ay 60 to 90 days and they need to renew their request from the mother unit. Aba, tila hind na ito dapat nangyayari at inaangkin na ang puwesto. Ito pa ang isang problema, Atty. Tanada, na hanggang ngayon ay may mga nareretire sa customs na puro pahirap ang dinadanas sa kanilang pag-reretiro na matagal umano ang pag-bibigay ng Clearance sa kanila. Ano po ba ang inyong maitutulong?

Sino ba ang unang humaharap sa mga container? Di ba ang mga Spot Checkers? Sila ang obligadong mag-check at report ng findings sa mga nakikita nila sa containers bago itong ilipat sa mga bodega at bago ma-process ang Consumption Entries. Kaya naman kayong mga tagaEMVMCO better check this isyu at balita na may mga BIS Permit na nagagamit ng iba kahit hindi intended sa kanila. Basta may parehong Description ay ginagamit ng sindikato, kaya ang tunay na may-ari ay nagugulat during processing ng kanilang importation na ito raw ay USED na. Dapat nang imbestigahan ito ng mga taga-Customs.

Bakit walang nahuhuli hanggang ngayon? Balita ay napakarami na raw at nagagawan ng paraan ng sindikato for Releasing without hassle from the Bureau of Customs. Alam ba nila Comm. Biazon at DepCom Lim ang mga ito? Anong say mo, Director Alino? Gaya ba nito ang mga Peking Ducks na until now ay walang nahuhuli?

Nasaan ang mga Ukay-Ukay?

Isang 40-footer container van shipment ang nailagay sa ALERT ORDER No. A-IG2011-1213-101 na naglalaman ng mga USED CLOTHING consigned to RMK Cherry Japan na galing sa Korea. Ang problema ay hindi raw alam ng may-ari ng kargamento na pinagbabawal ang used clothing for importation. At balita pa ay hind accredited ang Consignee nito. Ang violations nila ay dikit-dikit, so papaanong matutulungan ang may-ari ng shipment? May balita na tila humihingi ng tulong sa isang mataas na opisyal ng Customs. Note, may violation ang shipment under Republic Act 4653, which prohibits the importation of used clothings, so may Seizure na po ito. Dahil BAWAL PO ang shipment ay kahit sino pang attorney ng Customs ay walang magagawa. Provided kung gusting tulugan ay may paraan ang iba. Teka nga, nasaan na pala ang mga ukayukay? Bakit walang nahuhuli hanggang ngayon?

Tuloy na pinalulusot ang mga Luxury Cars

Hanggang ngayon ay may problema sa mga importation ng High-end Luxury Vehicles na nagpapatuloy ang kanilang mga kalokohan laluna sa mga buwis nitong binabayaran. Napaka-baba at mayroon din diyang pinalulusot by being misdeclared as SPARE PARTS sa ibang pantalan for processing at dinadala sa ibang port for registration. Old gimmick, but still existing. Kadalasan raw ay sa Ports of Subic, Davao at Cagayan na may mga anomalya na ganito.

SS Director, may nakarating sa ating isang hindi magandang isyu tungkol sa ilang dumarating na mga Military personnel na gusting bumisita sa kanilang mistah na tuwing nasisita ng mga tauhan mo sa mga gate ay nagagalit pa. Tila sila ay pumapasok sa isang military camp. Lumalabas sa sumbong ay mga arrogante daw. Best to check and investigate this issue at baka akala nila na ay mga security guard lamang ang mga tauhan niyo. Napakarami raw na nakakapasok ngayon sa BoC na mga armadong tao na hindi mo alam kung saang nangagaling at kung sino-sino sila na dapat ay mistah. Hindi na po tayo magtataka kung isang araw ay nagkabarilan na lang sa bureau. Medyo maangas pa raw.

Volume 4 Edition 4 January 2012

KRITIKO

11

QUESTIONABLE IMPORTSFrom Page 9

Php159.1M in Uncollected Taxes on Imported Pork?

Importers/Consignee QTY. & Origin Tax Paid Entry
Alternatives Food Corp 1 US Php247,839 C138652 Alternatives Food Corp 1 US Php247,961 C138659 Alternatives Food Corp 1 US Php161,324 C138667 Alternatives Food Corp 1 US Php247,839 C138652 Alternatives Food Corp 1 US Php247,961 C138059 (MAV 2012 = 54MT = 54,000kgs. = 2.16 containers) M Yuhico Ents. 1 CA Php189,317 C138583 M Yuhico Ents. 1 CA Php290,606 C138585 (MAV 2012 = 90MT = 90,000 kgs. = 3.6 containers) Classic Fine Foods PI 1 FR Php186,014 C140581 Classic Fine Foods PI 1 SPAIN Php 186,340 C140591 (MAV 2012 = 66MT = 66,000kgs. = 2.64 containers) DPO Phils. Inc. 1 GERM Php 32,727 C138572 (MAV 2012 = 36MT = 36,000kgs = 1.44 containers) Productline Intl. Corp 1 GERMSPhp279,456 C138589 (MAV 2012 = 350MT = 350,000kgs. = 14 containers) Fairfield Import E&T 1 FR Php 69,698 C138640 Fairfield Import E&T 1 FR Php 68,342 C138657 Fairfield Import E&T 1 FR Php 69,957 C138694 (MAV 2012 = 250MT = 250,000kgs. = 10 containers) CMA Meat Trdg. 1 CA Php285,026 C139053 (MAV 2012 = 50MT = 50,000kgs. = 2 containers) Promeat Products 1 US Php237,083 C139201 (MAV 2012 = 250MT = 250,000kgs. = 10 containers) Alpha Alleanza Mfg. Inc. 1 FR Php 50,884 C138320 Alpha Alleanza Mfg. Inc. 1 ES Php 58,339 C138325 (MAV 2012 = 750MT = 750,000kgs. = 30 containers) Batoy Trading 1 US Php 34,527 C141344 Batoy Trading 1 CH Php 70,590 C141353 (MAV 2012 = no allocation) Alegro Food Prods 1 GERM Php 41,299 C208991 (MAV 2012 = 18MT = 18,000kgs. = .72 containers only)

Summary on Study Total Importers Surveyed = 30 Total 40-ftr. containers = 90 units Total Importers with MAV 2012 Allocations = 25 Total Importers without MAV 2012 Allocations = 5 Est. Imported Quantity 90 containers x 25,000kgs./container = 2,250,000 kgs. x Domestic Market Value Php180/kg. = Php405,000,000 (or Php405million) Total Taxes Collected on 90 units = Php10,929,152 IF: Taxes per container = Php1,890,000 X 90 units = Php170,100,000 Less : BOC Tax Collected = Php10,929,152 Total BOC Collection Deficit = Php159,170,843 million
IF: at 50% Discrepancy: BOC Tax Collection Deficit would be Php79,585,421.5 (Php79.6 million)

Shipments without the MAV but with an Import Permit are required to pay the Safeguard Duties. Did the importers without the MAV pay the SGD worth a minimum of Php1million per container? If the SGD was paid, why is it not reflected in the taxes collected from the non-MAV importers? How can the Bureau of Customs allow imports of pork from non-minimum access value (MAV) holders? What is the National Meat Inspection Service (NMIS) and the Bureau of Animal Industry (BAI) doing with the exploitation of pork importations? What are the effects of the pork importations to local livestock breeders? What is the Bureau of Customs Commissioner doing about this continuing problem?

Notes on Study: MAV tentative allocations 2012 =22,406MT 1 metric ton = 1,000 kilograms 1unit of 40-ftr. reefer container = 25,000kgs. Duration: July to December 2011. Container size : 40-Footer Discrepancy: Research does not cover the complete BOC list of importers of pork covering the period July to December 2011 Domestic Market Value : Php180 per kilo` Est. Market Value per container = Php4.5million Est. Taxable Value (30%) = Php1,350,000 (Php1.3million) Est. 12%VAT per container = Php540,000

Est. BOC Tax Collection per container should be = Php1,890,000 (or Php1.89million)

Volume 4 Edition 4 January 2012

Happy Year of the Dragon!

Wan Shi Ru Yi! (May all your wishes be fulfilled!) Gong Xi Fa Cai! (Congratulations for wealth!)

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