Gov't urged to level playing field in steel

MANILA, Philippines - The Philippine Iron and Steel Institute (PISI) is appealing to Finance Secretary Cesar Purisima and Customs Commissioner Ruffy Biazon to level the playing field in the steel products industry.

The group has complained to the Department of Finance and the Bureau of Customs that Joyland Industries Corp., a Cebu-based company is engaged in technical smuggling as it is able to import finished steel products at below the prevailing prices of scrap metal.

Industry players are complaining that the Bureau of Customs Cebu is favoring Joyland, a claim that Cebu Customs Collector Ronnie Silvestre denied.

“There is no smuggling going on. There is no violation,” Silvestre told The STAR.

He said that Cebu Customs is looking into the matter and has asked the industry players to formally submit a rejoinder, which they have not submitted yet. 

Joyland a company based in Mandaue, Cebu is engaged in the importation of finished steel products, mainly smaller sized steel wire rods that is rolled and passed off as reinforcing steel bars. The products are distributed through hardware stores and used for small construction projects.

However, PISI said Joyland is able to import finished products at prices below prevailing industry rates.

In a statement, PISI claimed that on May 9, 2012, Joyland brought in a shipment of 7,904.17 metric tons of finished steel wire rods.

The declared value of the imports was $279 per metric ton, below the import price of $640 to $700 during the April to May 2012 period.

Furthermore, PISI said that in January 2011 when prices were at $480 to $495 per metric ton, Joyland was declaring its imported finished products even lower than scrap prices.

Aside from PISI, the Steel Institute and the Galvanized Iron Wire Manufacturing Association is also appealing to Biazon and Purisima to look into the matter.

The groups said that the Bureau of Customs is allowing the Cebu steel company to use the “transaction value method” for determining taxes and duties due imported products.

“Under this method, the importer simply presents documents indicating the value of the shipment, provided these are notarized by accredited lawyers form the source,” PISI said.

According to PISI, the group has already sent several letters to Biazon, seeking the investigation of some import shipments passing through the Port of Cebu.

The last was dated May 10, 2012 wherein the group asked Biazon to look into the undervaluation of imported steel products for shipments that came in last March.