FPI backs redefining smuggling as economic sabotage

MANILA, Philippines - The Federation of Philippine Industries (FPI) supports a proposed measure in the Senate that would define smuggling as a form of economic sabotage suspect to heavier penalties for offenders.

According to the FPI, it backs Justice Secretary Leila De Lima who is supporting Senator Grace Poe’s bill seeking to define smuggling involving goods totalling P1 million as a form of economic sabotage.

According to FPI chairman Jesus Lim Arranza, it is timely for the government to impose a higher penalty on smuggling.

Arranza shares the DOJ Secretary’s view that the offender should be given the maximum penalty of life imprisonment or reclusion perpetua for smuggling.

The legal opinion was issued recently by De Lima upon the request of Sen. Juan Edgardo Angara who serves as chairman of the Senate Ways and Means Committee.

 “Indeed, it should rightfully be defined as economic sabotage because no less than President Benigno Aquino acknowledged in his last year’s SONA (State of the Nation Address) that the government is losing about P200 billion in unpaid revenues annually from smuggling,” Arranza said.

Arranza pointed out that smuggling does not only affect government revenues, but also local manufacturing firms that cannot operate at full capacity because of unfair competition.

Due to unfair competition from smuggling, some companies are even forced to close shop and lay-off workers.

Worse, if a company closes, it would likewise affect the entire supply chain starting from the raw material suppliers, packagers, truckers, indirect laborers, Arranza said.

The FPI has been actively pushing for government to step-up efforts to curb smuggling.

In line with the aim to fight smuggling, the group had earlier called for the immediate exercise of the government of its right of compulsory acquisition of undervalued imports.

Under Section 2317 of the Tariff and Customs Code of the Philippines, the government could exercise the right of compulsory acquisition to protect revenues from undervaluation of goods.

As such, the Customs commissioner may order the acquisition of imported goods under question for a price equal to their declared customs value plus any duties already paid on the items.

The FPI believes such move would encourage all importers to declare the proper value of goods purchased overseas.