Piatco seeks help on tariff issue

The Philippine International Airport Terminals Co. (Piatco) wants the Department of Trade and Industry to intervene in the petition for the duty-free importation of airport equipment needed for the ongoing construction of Terminal 3 at the Ninoy Aquino International Airport (NAIA).

Piatco met with the DTI on Friday and appealed the decision of the Philippine Export Zone Authority (PEZA) to reject its original request for zero tariff on the importation of airport equipment such as baggage handling equipment, conveyor belts, air bridge equipment and other airport-related equipment.

Present during the meeting was Hans-Arthur Vogel, director for finance and treasurer of Philippine Airport Ground Services (PAGS) Terminals, which owns 60 percent of Piatco. With him was PAGS director for terminal operations S. Samin Aydin.

PAGS is a shareholder in the Piatco consortium, owning up to 60 percent of the group that won the contract to develop, upgrade and operate NAIA Terminal 3.

Piatco officials appealed to Trade and Industry Secretary Manuel Roxas II, who is also chairman of the PEZA board, to reconsider PEZA’s decision to reject its original request for duty-free importation of equipment.

The PEZA board had ruled that the tax and duty-free importation is a privilege enjoyed specifically by ecozone locators. The PIATCO Terminal 3 project however, is not intended entirely for use within a free trade zone, but for general public use.

According to Piatco, the law is not clear if the importation of the equipment is exempted from duties or not.

The company is registered with PEZA and is entitled to various incentives, but the export authority rejected its request.

Under the law, export industries and export-supportive industries are entitled to various incentives including duty-free importation of capital equipment.

However, the agency said airport-related equipment do not qualify since they will service both export and domestic industries.

Piatco said it is appealing the PEZA decision before the DTI since it is the supervising agency. At present, the company is importing its equipment at tariff rates ranging from three to seven percent.

Roxas said the DTI will have to determine whether Piatco’s reading of the law was accurate and that the PEZA decision could be appealed with the DTI.