Through Board Resolution No. 28-25 S’2005, the BoI said it resolved to cancel the cement firm’s BoI registration due to its alleged failure to maintain the mandatory 60-percent Filipino ownership to qualify for tax incentives; late/non-submission of reports on the firm’s transfer of ownership; and late filing of its 1997 income tax holiday (ITH) application.
Based on the firm’s general information sheet with the Securities and Exchange Commission (SEC), Grand Cement was 73 percent owned by Filipinos and 27-percent Japanese as of April 30, 2000.
But a year later, in April 2001, Taiheiyo acquired 88 percent of the company, leaving locals with only a 12-percent stake.
In 1997-1998 alone, Grand Cement availed of more than P200 million in incentives in the form of ITH.
While majority ownership of the firm was acquired by Japanese cement giant Taiheiyo in 2001, BOI records showed that said transfer was not disclosed by the company until 2005.
Aside from its BoI troubles, Taiheiyo is plagued with a similar non-disclosure problem before the Bureau of Customs (BoC).
Taiheiyo’s sister-firm, Southern Cross Cement Corp. (SCCC), is currently facing multiple criminal complaints before the BoC due to alleged misdeclarations in their cement importation documents.
Based on case records, SCCC imported cement from its parent firm – Taiheiyo Cement Corp. (Japan) – but stated in its Supplemental Declaration on Valuation (SDV) that the buyer and seller are not related parties.