Government to buy seized smuggled goods for sale to private sector

MANILA, Philippines - The government, through the Philippine International Trading Corp. (PITC), will buy the seized smuggled goods languishing in warehouses and re-sell this to the private sector, Customs Commissioner Angelito Alvarez said during the weekend.

The move is part of the Aquino administration’s plans to curb smuggling, which according to Alvarez translates to P40 billion in lost revenues for the government every year.

Alvarez said PITC would soon sign an agreement for a P1-billion credit line with the Land Bank of the Philippines for the compulsory acquisition.

“Undervalued goods will be acquired by the government through PITC,” he said.

Under the plan, PITC, the state-owned trading arm would tap its credit line from Landbank to acquire the goods seized by the Bureau of Customs.

The plan came about as a suggestion from the Federation of Philippine Industries (FPI).

FPI suggested that the BOC implements “forced acquisition” to shore up revenues and curb technical smuggling.

Alvarez said importers who undervalued their shipments would have no choice but to mend their ways and start declaring the right value of their imports.

He said the importers themselves may buy the goods but for the right value.

Earlier, FPI urged the BOC to do “forced acquisition.” The group, an umbrella organization of local industry players, said the government could have raked in billions in fresh revenues when the previous BOC leadership failed to wield its power of forced acquisition.

FPI chairman Jesus Arranza has said the previous Customs administration used this power and acquired some 93,000 metric tons (MT) of undervalued steel imports that entered the country in the first five months of the year.

“The BOC must invoke its right of compulsory acquisition for imported products that are grossly undervalued if the agency really hopes to curtail smuggling and generate more revenues for the government,” Arranza said.

He said the steel shipments were only valued at an average price of $63 per MT when their proper valuation should have been $700 per MT.

Under Sec. 2317 of the Tariffs and Customs Code, the BOC has the right to acquire them and then sell them to the private sector at the correct value.