Olongapo SubicBay BatangGapo Newscenter

Sunday, September 19, 2004

Has Subic Bay become center of car smuggling?

HAS SUBIC Bay, a freeport hub, become a smuggling center?
This question cropped up after Customs Commissioner George Jereos told the Senate that right-hand-drive vehicles were entering the freeport with the approval of officials of the Subic Bay Metropolitan Authority.
The law bans the entry of such types of vehicles into the country.
Testifying Monday at a joint hearing by the Senate committees on trade and industry, and economic affairs, both chaired by Senator Manuel “Mar” Roxas II, Jereos said the entry of right-hand-drive vehicles through Subic was facilitated by importation permits.
Under questioning by Senator Richard Gordon, Jereos conceded that "no article (including said vehicles) can enter Subic without any import permit issued by the SBMA."
"So SBMA is the culprit then?" asked Gordon, who observed that if SBMA "is ... in this, they (freeport officials) are the ones responsible for the violation."
Jereos replied: "Logical conclusion, Mr. Senator."
Happening at Clark, too?
Pressed further by Gordon, Jereos said the same could hold true at the Clark Special Economic Zone. Gordon pointed out during the hearing that as many as 90,000 cars had allegedly entered the country illegally through SBMA "in the past so many years." In January 2003 alone, 6,000 cars were imported into Subic Bay, he said. Jereos nodded.

Jereos said that right-hand-drive cars being brought into SBMA were "converted by some companies inside the zone and brought out of the zone as (left)-hand-drive (cars)."
Gordon rebuked Jereos for seemingly being ignorant of SBMA rules and regulations that prohibit such conversions because it "causes pollution to the environment."
The rampant importation of vehicles for conversion to left-hand drive had resulted in diminishing sales in the car market in the last two or three years, based on Land Transportation Office (LTO) records, said Gordon.
Killing local industry
Gordon chided the Bureau of Customs (BOC) for "turning a blind eye on a pernicious operation that is also killing the local automotive industry."
He said that the government was losing much-needed revenues due to the failure of customs officials to stop the highly questionable importation of luxury vehicles into the country through Subic and Clark.Gordon reminded Jereos that the customs bureau should enforce at Subic and Clark the law banning the importation of right-hand-drive vehicles.
The senator also pointed out that, during his chairmanship of the SBMA, there were also rules prohibiting the conversion of right-hand-drive vehicles inside the freeport.
"You can just say 'no' to importation of right-hand-drive vehicles and be done with judicial declaration," Gordon told Jereos. "Why has that not happened? Are there powerful interests behind these car importers?"
For monitoring purposes
The senator said that the smuggling of luxury vehicles would cause severe harm to the country from the "standpoint of revenue, productivity, which decreases our creation of jobs, and from the standpoint of safety and the environment."
"Would you let your son or your daughter drive a right-hand vehicle converted to a left-hand vehicle without any assessment made by the LTO or by other responsible authorities?" Gordon asked Jereos. "I will not," the customs chief answered.
The SBMA, in a statement yesterday, said the freeport "issues importation permits to locators [investors] here for regulated items, including used vehicles, for monitoring purposes."
"Being a freeport zone, goods can be unloaded in Subic without being considered an importation," it said in a statement issued by its public relations office.
"However, before the goods are released into the Customs territory, the importer must secure other necessary permits from the government and pay the required duties and taxes imposed by the (BOC)," it said.

The SBMA said that, while a permit from the Bureau of Import Services (BIS) was required for second-hand vehicles, "the BOC accepts the payment of duties and taxes and penalties in the absence of a permit from the BIS." "It is only after the taxes and penalties are paid that vehicles are registered when (these) are issued gate passes by the SBMA for their release," the statement said.


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