SICPA proposal not a done deal - Teves

MANILA, Philippines - The proposal of Swiss firm SICPA Product Security SA to provide security stamps on cigarettes is not a done deal, Finance Secretary Margarito Teves said yesterday, assuring lawmakers that there was nothing final yet.

“It must be clarified that the SICPA (proposal) is merely an unsolicited proposal under the BOT (Build-Operate-Transfer) Law. It’s not a done deal yet,” Teves said. 

He said that even if the Bureau of Internal Revenue (BIR) is already in negotiations with SICPA for its stamp-tax technology project, it would still be sent back to the National Economic and Development Authority (NEDA) for its board approval and subsequently, be subjected to a “Swiss Challenge.”

“Processes must be observed before a decision on SICPA is made,” he told reporters yesterday.

Lawmakers are blocking SICPA’s unsolicited proposal to provide tamper-proof stamp-tax technology in cigarette and alcohol exports, saying that this would translate to higher costs for consumers.

Antique Rep. Exequiel Javier, House ways and means committee chairman and Deputy Minority Leader Roilo Golez urged the BIR to do further studies of the SICPA proposal.

Javier, for his part, said the SICPA proposal involves revenue generation and, therefore, requires approval of Congress or changes in the BOT law.

SICPA’s proposed to provide tamper-proof strip stamps on cigarette and alcohol exports using a combination of data matrix code and fuse-on features; and installation in the premises of tobacco manufacturers of scanning and activation software to monitor the number of tobacco products produced.

The move seeks to curb rampant smuggling in the country.

The Investment Coordination Committee (ICC) of NEDA has earlier approved the SICPA proposal and ordered the BIR to start negotiating with the Switzerland-based firm.

The NEDA-ICC, however, stressed that it should open the unsolicited proposal to challenge from other similar foreign companies, which could provide the same technology.

A Swiss challenge is a form of public procurement which requires a government agency publish the bid and invite other prospective private proponents in the market to match or exceed it.

Tobacco companies in the Philippines are opposed to the proposal of SICPA, saying that it would mean higher costs to consumers.