Sale of smuggled rice at Subic nets P116-M

SUBIC FREEPORT — Authorities here have given President Arroyo’s war against smuggling a big boost by auctioning 180,000 cavans of smuggled rice, earning for the cash-strapped government P116 million.

Chairman Felicito Payumo of the Subic Bay Metropolitan Authority (SBMA) told a congressional group that visited the port yesterday that the Customs office here auctioned the seized rice after the courts lifted injunctions issued upon petition of the suspected smugglers who claimed to be legitimate rice traders.

"The government could have earned more had the courts allowed the sale through bidding earlier. As it was, the rice had already deteriorated in quality, and yet, it fetched a good price," Payumo informed Rep. Prospero Nograles (Lakas, Davao City), head of the group.

Nograles said the war against smuggling would succeed if Customs and other concerned agencies could auction confiscated contraband, especially perishables like rice and food products, as fast as possible.

"The prospect of smuggled products being seized and sold under our Customs rules will deter smugglers because they will lose money. The illegal practice will no longer be profitable for them," he said.

He said the courts should not meddle in the enforcement of Customs rules except in cases where there is irregularity or abuse of discretion on the part of those enforcing them.

SBMA and Customs records showed that Judge Eliodoro Ubiadas of the Olongapo City Regional Trial Court had issued a restraining order covering part of the 180,000 rice shipment that arrived in Subic on board MV Hung Yen, a Vietnamese vessel.

Ubiadas had also stopped SBMA from cutting off electricity supply to the Crown Peak Resort Hotel, which it had leased to a Manila-based businessman who, officials claimed, had failed to pay about $2.8 million on rentals and P47 million in electric consumption bills.

Payumo said the President wanted the large smuggled rice shipment distributed to typhoon victims in Central Luzon and other parts of the country had it not been for the court injunctions.

"But we were able to distribute hundreds of bags when the typhoons struck recently. These were part of uncontested shipments," he said.

The Nograles group’s visit is part of a House investigation into the entry here of used right-hand drive (RHD) vehicles. The Davao congressman is author of a resolution that prompted the inquiry.

He said he wanted to check whether the importers and auctioneers were paying the right amount of taxes and if conversion into left-hand drive is done inside Subic as required by law.

The group chanced upon an auction conducted by Asia International Auctioneers (AIA), whose officials said they expected to gross more than P200 million from the sale through bidding of about 1,200 used vehicles that came mostly from Japan.

AIA’s Romulo Armamento said their buyers are not only Filipinos but they include Indonesians, Malaysians, Vietnamese, and even Japanese who sell the vehicles abroad.

He said most of the vehicles are small utility trucks and equipment that are needed in plantations, orchards and farms.

Payumo said the importers and auctioneers have paid P529 million in taxes in 2000 and 2001, and P129 million for the first half of this year.

"They are contributing to our economy not only in terms of taxes but also in employment here and in related industries such as repair, trucking and trading, and in developing agriculture and small businesses where many of the light vehicles and equipment sold are used," he said. – Jess Diaz