Philippines reports on Thailand’s compliance to WTO cigarette tax ruling

MANILA, Philippines - The Philippines will provide a report on the status of Thailand’s compliance to a World Trade Organization (WTO) ruling on a cigarette tax case this week. 

In a notice posted on its website, the WTO said the Philippines would give a statement on Thailand’s customs and fiscal measures on cigarette imports from the Philippine during the meeting of the agency’s Dispute Settlement Body (DSB) on Monday.

The Trade department said earlier the Philippine government is giving Thailand time to address outstanding issues on its compliance to the WTO decision amid a change in the political leadership last year. 

Thai army chief Prayuth Chan-Ocha who took control of the country in a coup that toppled the government of Yingluck Shinawatra, was named prime minister by the legislature in August last year. 

Among the outstanding issues is Thailand’s compliance to the WTO ruling particularly is the decision of the Thai attorney general to prosecute an importer of Philippine cigarettes and several of its employees for alleged under declaration of customs values from 2003 to 2007.

The Philippine government is asking its Thai counterparts to provide information on the matter to determine whether the customs transactions covered by the WTO ruling are also part of the case Thailand wants to prosecute. 

Trade Assistant secretary Ceferino Rodolfo said earlier that as the government waits for Thailand’s action on the outstanding issues, it would also want to ensure that Philippine export interests are not affected and gains from the WTO ruling continue to benefit exporters. 

In 2011, the WTO issued a decision ordering Thailand to put in place reforms on customs valuations and taxes.

This, as Thailand’s imposition of higher duties on cigarette imports from the Philippines was in violation of global trading rules. 

The WTO ruling was issued for a case filed by the Philippines, on behalf of Philip Morris Philippines, against Thailand for the imposition of higher duties on its cigarette exports. 

As outstanding issues remain, the Philippines has two options: to continue surveillance in the DSB or to go to formal proceedings for dispute settlement.