Taiheiyo Cement penalized for late disclosure

Cebu-based Taiheiyo Cement Philippines Corp. (formerly Grand Cement Manufacturing Corp.) was slapped a P1.2-million penalty by the Board of Investments (BOI) due to its late disclosure that Japanese nationals own 88 percent of the company since April 2001.

Taiheiyo paid the amount to the BOI Region 7 – Cebu Extension Office following the cancellation late last year of the cement firm’s BOI registration. Its registration was cancelled 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 application.

In 1997-1998 alone, Grand Cement availed of more than P200-million worth of fiscal incentives in the form of income tax holidays.

Securities and Exchange Commission (SEC) records show that Grand Cement was 73 percent owned by Filipinos and 27 percent by Japanese nationals as of April 2000. But a year later, Taiheiyo acquired 88 percent of the company, leaving locals with only 12 percent.

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 the BOI, Taiheiyo also faces 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 that the buyer and seller are not related parties. — Marianne Go