Editorial - Independent republic

How complicated is it to spell out clear-cut rules on vehicle importation? And how hard is it to control the exit of certain types of vehicles from a freeport zone?

For many years, major motor vehicle makers and dealers complained about unfair competition posed by the duty-free entry of used vehicles and parts through the country’s free ports. So the government banned the importations, but inserted exemptions and loopholes that could be exploited to pave the way for vehicle smuggling.

Executive Order 156, issued by then President Gloria Macapagal Arroyo on Dec. 12, 2002, banned the importation of all types of used motor vehicles, parts and components. But vehicles of the current year model with mileage of less than 200 kilometers are exempted. So are vehicles for use by the diplomatic corps, or owned by a returning resident or immigrant; such vehicles supposedly cannot be sold within three years from being brought into the country. The ban also did not cover trucks except pick-ups, buses and special purpose vehicles. Locators in free ports can import used vehicles but these cannot be brought out of the special zone.

In the Ilocos region, the special arrangements enjoyed by the Cagayan Special Economic Zone and Freeport have been seen by critics as political accommodation for the long entrenched political kingpin of the province, Juan Ponce Enrile, currently the Senate president. A case involving the importation of used vehicles through the Cagayan freeport is currently pending with the local regional court, and people believe the outcome of the case is a foregone conclusion.

Recently, 200 pre-owned cars from Incheon, South Korea were brought in through the Cagayan freeport. Customs authorities have ordered the shipment impounded. The importers argue that there is no final Supreme Court ruling on such shipments.

Another 400 cars are scheduled to arrive, either on Thursday or Saturday. Are all these cars for diplomats and Cagayan freeport locators? Can the government prevent the vehicles from leaving the freeport premises? A free port is not an independent republic. The government’s difficulty in regulating business at the Cagayan freeport reflects badly on the national leadership.