Oil firm faces P5-B smuggling raps

MANILA, Philippines - The Bureau of Customs (BOC) yesterday filed a P5-billion smuggling case against Phoenix Petroleum Philippines, Inc., regarded as one of the leading independent oil industry players in the country.

BOC Commissioner Angelito Alvarez filed the smuggling case against the oil firm before the Department of Justice (DOJ), under the Run After the Smugglers (RATS) program.

Phoenix is considered a “big fish” because it ranked 211th among the country’s top 10,000 corporations in 2009.

Lawyer Raymond Zorilla, assistant vice president for external affairs of Phoenix Petroleum, said the company expresses surprise over news reports that the BOC had filed charges against the firm.

He said the company strongly denies any allegations of non-payment of taxes and non-submission of importation documents.

“The company has been paying taxes religiously and its records will clearly belie these unfounded accusations against it. As a matter of fact, the company is among the top taxpayers in Davao City, where it is based.”

Zorilla said BOC should exercise caution and fairness especially if the accusation is damaging to the taxpayer.

He said the filing of the complaint against Phoenix is unjust, arbitrary and oppressive.

“It unfairly damages all the hard and honest work that the company has exerted in building its name,” Zorilla said.

He said the company is not taking this accusation lightly and they are consulting legal counsel on all possible courses of action.

The BOC named as respondent in the case Phoenix president and chief executive officer Dennis Ang Uy.

He was charged for allegedly violating the Tariffs and Customs Code of the Philippines (TCCP), non-payment of excise and value-added taxes, non-submission of import documents such as invoices and bills.

Included in the charge sheet were Jorlan Capin Cabanes, who is a Davao-based customs broker, and several unidentified people who might have conspired to defraud the government.

Commissioner Alvarez said their RATS Group reportedly discovered that at least nine of the import entries did not match the volume and value of the Load Port Survey (LPS) provided by the international surveyor contracted by the bureau.

Investigation conducted by the RATS showed that within the period of 11 months, from June 2010 and April this year, the oil firm made several importations of various petroleum products with a combined dutiable value P5,144,035,000.

The petroleum products reportedly came from Thailand.

Customs Deputy Commissioner Gregorio Chavez, concurrently the executive director of the RATS Group, cited the reported anomalies committed by the oil company.

Chavez said P459-million worth of imported petroleum products that the company brought in between June and December 2010 were reportedly cleared by the BOC without any supporting import entry declarations, effectively depriving the government of lawful duties and taxes due on the said shipments.

P4.7-billion worth of various imported products, covered by 31 import entry declarations, were taken out of the Port of Davao and the sub-port of Bauan, Batangas between June 2010 and April 2011 despite the non-submission by Phoenix of the required importation documents such as invoices and bills of Lading.

Alvarez lamented that while Customs revenues have been adversely affected by the regime of duty free importations of petroleum products that took effect last July, companies such as Phoenix would cause further aggravation by resorting to illegal tax evasion practices.

He also instructed the BOC’s Post-Entry Audit Group (PEAG) to audit all importations made by Phoenix prior to June last year.