Businessmen want SGS back as third party contractor

Frustrated by persistent conflicts with the Bureau of Customs over the valuation of imported goods, the Philippine Chamber of Commerce and Industry (PCCI) wants the government to accredit Societe Generale Surveillance (SGS) as third party contractor to conduct independent valuation for importers.

Seven months after the government permanently terminated its pre-shipment inspection contract with the SGS, PCCI vice president Sergio Ortiz-Luis said the BOC has been in constant conflict with importers over the value of imports which are the basis for assessing import duties.

Ortiz-Luis said that although the BOC was able to smoothly take over the processing of imports, the inadequacy of its databank has consistently spawned disputes with importers who have to prove the prices of their imported goods.

"The BOC is always questioning the declared value because they have no standard, their price band is too wide," Ortiz-Luis said. "If an importer is right, he has to prove it and this causes delay in the release of the goods."

Ortiz-Luis said that following the PCCI’s initial discussions with the BOC, government officials appeared amenable to the proposal to accredit a third party valuator that would act as an arbitrator when disputes arise.

"This won’t be like the old system where government has to bid out a service contract, it can just accredit the contractor or several contractors," he said. "Since SGS already has the most reliable database, it would make sense for them to undertake this.’

According to Ortiz-Luis, the BOC had reported improvements in its revenue collection but it was not satisfied because the hike had been due to the increase in tariffs collected from an imported cellphone units and other imported products.

The increase in revenue did not reflect an improvement in the collection efficiency of the BOC’s collection system.

Local businessmen have been pressing the BOC to complete the implementing rules and regulations for the post-shipment processing of imports, asking for transparency of the database used in determining import taxes and duties.

The PCCI said importers were satisfied with the take-over of the BOC but are still waiting for government to start implementing the original post-audit processing that was supposed to replace SGS’ pre-shipment inspection procedures.

The service contract of SGS terminated at the end of March this year, leaving the BOC solely in charge of import processing as its shifts its imports valuation basis from home consumption value to transaction value.

This has made local and foreign companies apprehensive over the BOC’s capacity to take over without disruptions the processing of incoming cargoes.

Early, the PCCI had expressed skepticism over the BOC database to be used for Customs valuation, saying that it was prepared to hire a third party service contractor that might be interested in the pre-shipment processing service contract.