Customs orders probe on gas smuggling at port of Manila

Bureau of Customs Commissioner Napoleon Morales yesterday ordered a deeper investigation on the reported technical smuggling of gas oil at the port of Manila involving two importers who had allegedly gotten away with P37 million in unpaid taxes and duties.

Morales said he has mobilized four departments of the bureau – the Internal Investigation and Prosecution Division (IIPD), Value Classification and Review Committee (VCRC), Investigation and Prosecution Division (IPD) and Post Entry Audit Group (PEAG) – to conduct simultaneous investigations into the case of Andan Enterprises Inc. and Mawab Resources Inc.

He has also directed the bureau’s Post Entry Audit Group (PEAG) to check on previous import entries of the two oil firms upon recommendation of Customs Intelligence and Investigation Services (CIIS) assistant chief Eric Albano, who discovered the undervaluation of gas oil shipments of the importers.

The Customs chief said if their comprehensive investigation showed ample evidence that would prove that the oil firms cheated in their import declarations, the bureau would demand the companies to settle their tax dues with the government within 10 days.

"The normal process is that we will issue a notice to the companies involved, demanding additional payment of duties and taxes, including penalties and surcharges, within the prescribed period of 10 days," Morales said.

The CIIS has earlier conducted an investigation into the case and has submitted to the Office of the Commissioner a recommendation to demand the additional payment of duties and taxes from the two oil firms, plus surcharges citing the huge discrepancy in the value of taxes paid and by other oil firms for the same product with the same origin.

The CIIS also recommended that all incoming shipments from both oil firms be put on hold until such time they settle their dues, amounting to P37 million, with the government.

Morales earlier ordered the preventive suspension of six Customs personnel at Section 11 of the port of Manila who reportedly handled the release of the gas oil shipments.

Andan Enterprises and Mawab Resources, however, denied the charges of undervaluation, citing that the oil deregulation law which allowed players to source its oil imports from any country in the world has created a favorable market atmosphere for competition, which is the very essence of the oil industry deregulation.

"Different sourcing strategies enable us to buy our imports at competitive prices. To say that we undervalued our shipments is not only misleading but unfair," they argued.

Morales said he has also given the suspended Customs personnel 72 hours to explain why they should not be criminally charged for their involvement in the anomaly.