‘Ex-BPI exec gave onion importers P14-M tax break’

MANILA, Philippines - Former director of the Bureau of Plant Industry (BPI) Clarito Barron, accused of involvement in garlic and onion cartels, has been linked to big-time importers as early as 2005.

Documents obtained by The STAR showed Barron writing on Jan. 7, 2005 then Bureau of Customs director George Jereos to exempt four firms – Shelmarie Enterprises, Touchdown Trading, A.GR Trading and A. Bana Trading – from paying special safeguard duty (SSG) amounting to P14 million.

Barron’s letter was written barely two months after former agriculture secretary Arthur Yap gave orders that all onion importers should pay SSG.

“We wish to inform you that based on our findings… importation of onions under the following BPI import permits issued by this office are deemed in transit and thus, exempt form the special safeguard duty,” Barron wrote.

Touchdown Trading and Shelmarie were each importing 80 metric tons of onion while A. GR Trading and A. Bana Trading were importing 75 and 50 metric tons, respectively.

Shelmarie and A. GR trading were linked to businesswoman Leah Cruz, an alleged accomplice of Barron.

Cruz, according to the recent findings of the Department of Justice (DOJ) and the National Bureau of Investigation (NBI), is allegedly involved in the manipulation of onion and garlic prices in the country.

Barron and Cruz could not be contacted for comment yesterday.

The two and 125 others were criminally charged last week.

The Tariff Commission defined SSG as a special transitional tax, which the government may impose if it deems that a sudden surge of product imports “cause or threaten to cause serious injury to domestic industry.”

‘Exemption has no basis’

In his letter to Jereos, Barron attached a letter addressed to him by from Jorge Paterno, then chief of staff of Food Security and Legislative Affairs of the House of Representatives, claiming that there was a “shortage” in onion supply.

“We wish to inform you that we pose no objection to requests for exemption from the SSG of onion importers in the attached list. For brevity, we have made a list of importers who has provided us with copies of their letter to Secretary Yap, their import permits and quantities requested and made it an integral part of this letter,” Paterno’s letter read.

“The price of onion remains at unprecedented high levels, an indication of continuing shortage of onions in the market. The imposition of SSG duty of P61 per kilo to shipments with valid import permits from your bureau can in fact exacerbate the situation, push prices even higher and discourage the entry of onions to a very thirsty market,” the letter stated.

But the Bureau of Customs questioned Paterno’s letter and Barron’s endorsement. On Jan. 17, 2005, BOC wrote Barron, telling him that it would seek Yap’s “clarification.”

The DA’s response caused Barron to withdraw his letter.

In its letter to BOC, DA’s legal office recalled Barron’s endorsement, saying the exemption “cannot be justified” under Republic Act 8800 or the law protecting local industries from surges of imports.