DTI weighs proposal to extend tariff on testliner boards

MANILA, Philippines - The Department of Trade and Industry (DTI) is studying a recommendation from the Tariff Commission to extend the safeguard measure imposed on imported testliner boards which expired in June.

“It (Tariff Commission’s recommendation) is under evaluation,” Trade Secretary Gregory Domingo said in a text message.

He declined to say however when the department would decide on the matter.

As the DTI has yet to issue a decision, the tariff on imported testliner boards will remain at its current level of P1,211.15 per metric ton (MT).

Testliner boards, which are usually made of recycled paper, are used to produce corrugated boxes for the packaging of consumer products.

The Tariff Commission has recommended the extension of the safeguard duty on testliner boards, which expired on June 14, for another three years citing that it is necessary to give the local industry time to implement its adjustment plan and prepare for competition from imports.

For the first year of implementation, the Tariff Commission is proposing a safeguard duty of P1,150.60 per MT, which represents a five percent reduction in the current safeguard duty of P1,211.15 per MT, following the DTI’s formula.

The recommendation was made after the conduct of public hearings for the petition filed by the Philippine Paper Manufacturers Association, Inc. in November last year.

The Tariff Commission noted that the local testliner board industry needs to prepare as it faces threat from imports, with tariff rates in various free trade agreements being eliminated and producers in other countries undertaking expansion.

Under Republic Act 8800 or the Safeguard Measures Act, safeguard measures are allowed to provide relief to domestic industries threatened by an increase in imports of directly competitive products.

The safeguard measure on testliner boards was introduced by the DTI in July 2011 to help local players adjust to competition from imports.

On the first year of implementation of the safeguard measure, a duty of P1,342.00 per MT was imposed on imported testliner boards.

The duty was reduced to P1,274.90 per MT the following year and trimmed further to P1,211.15 per MT on the third year of implementation.