Lawmaker warns of trade slowdown

A pending bill in Congress seeking to prohibit the use of freeports as international ports of entry for products intended for domestic use would restrict trade and slow down business in freeports, according to Zambales Rep. Milagros H. Magsaysay.

House Bill 4069, authored by Rep. Eric Singson, amends certain provisions of Presidential Decree 1464 or the Tariff and Customs Code.

The bill states that "freeports shall not be used as international ports of entry for articles that are destined for the domestic market or customs territory." It specifies the country’s principal ports of entry as those in Manila, Ninoy Aquino International Airport, Cebu, Iloilo, Davao, Tacloban, Zamboanga, Cagayan de Oro, Surigao, Legaspi, Batangas, San Fernando, Subic and the Manila International Container Port.

While Magsaysay said she was able to delete the proposed provision during the period on individual amendments last June 7, she said the provision might still be reinserted during the bicameral conference committee meeting.

She warned that "such a proposition would spell the death of the freeports, which were created precisely to serve as ports of entry for products meant for local consumption."

She argued that approving the proposal would "only make matters worse for them and for the country’s economy."

Magsaysay pointed out that a number of locators within the freeports are already suffering from an unhealthy business climate.

She also fears that locators in the freeports would lose the incentives they are presently enjoying if the provision is approved.

Freeports allow imported goods to be unloaded, repacked and sorted without being subject to import duties.

However, if the imported goods are sold outside the freeport area, the goods are subject to the appropriate tariffs and taxes.

The existing freeports in the country are Subic, Cagayan, Bataan Technology Park and Zamboanga.