By Janina C. Lim, July 4 2019; Business World
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A CONSUMER GROUP said the Tariff Commission’s (TC) hearings to evaluate safeguard duties on cement are “moot and academic” because the commission failed to comply with the timelines provided by the law.
Laban Konsyumer Inc. (LKI) said the TC’s failure to comply is grounds for rejecting a safeguard duty on imported cement.
“In our opinion, the Tariff Commission should declare the investigation and release of the report functus oficio, or moot and academic, and cancel the safeguard duty immediately for non-compliance with Sections 8 and 9 of RA (Republic Act) 8800,” LKI President Victorio Mario A. Dimagiba said in a Thursday statement.
Mr. Dimagiba, a former undersecretary at the Department of Trade and Industry (DTI), was referring to the provisions of the Safeguard Measures Act of 2000 which specifies a 200-day period for the imposition of the provisional duty and a 120-day investigation period after the Feb. 22 effectivity date.
Although the provisional duty expires in the first week of September, the TC has failed to beat its deadline to complete its investigation report, according to LKI.
“As of today, July 3, [last Wednesday] 2019, the final report and findings of the Commission have not been issued and delivered to the Secretary of Trade and Industry,” Mr. Dimagiba added.
In addition, Mr. Dimagiba said the duty has caused an increase in cement prices which will end up as an additional costs passed on to consumers.
Citing government data for June, Mr. Dimagiba said the prevailing price of members of the Cement Manufacturers Association of the Philippines (CeMAP) stood at P235 per bag, an increase from the P225 reported in May.
Meanwhile, prices of Eagle Cement Corp., which is not a member of CeMAP, averaged P220 per bag.
“Demand for cement is strong and CeMap members cannot meet the demand. Imports will continue and definitive duty will hurt consumers. Local plants will increase their prices and match landed costs of imports,” it added.
CeMAP is composed of CEMEX Holdings Philippines Inc., Holcim Philippines Inc., Republic Cement Services, Inc., and Taiheiyo Cement Philippines, Inc.
At a public hearing at the TC in May, the group said it was seeking a safeguard duty that is higher than the P210 per ton imposed by the DTI.
The ongoing investigation on cement is the TC’s first motu proprio case on safeguard duties.
The DTI launched the review, saying the surge in cement imports have been seriously hurting the domestic industry.
The DTI has said it will look into the possibility of stretching the use of the provisional safeguard duty should the TC fail to complete its investigation in time for the tax’s removal in September.
The Philippine Cement Importers’ Association had said that the domestic cement producers have high operational costs, making their product less competitive than imports.
The TC and the DTI were asked to comment but had not replied at deadline time. — Janina C. Lim