‘Cheating’ importer has shipment seized at Cebu port

On Mar 18, 2021

The brand-new rotary drilling rig from China imported at the Port of Cebu by a local trader undergoing routine check from a K-9 team from the Philippine Drug Enforcement Agency on its arrival. District collector Atty. Charlito Mendoza ordered the equipment’s seizure after the importer used fake shipping documents so it can be released at a much lower amount of taxes and duties (photo by BOC-PIAD).

AN importer of a rotary drilling rig from China used in building construction and other infrastructure projects paid the heavy price of having the equipment seized at the Port of Cebu after vigilant customs assessment personnel discovered that fake documents were used for its release at more than 89 percent below its payable legal taxes and duties.

Port of Cebu district collector, Atty. Charlito Martin Mendoza, in his report to customs commissioner, Rey Leonardo Guerrero, said that he ordered the brand new, 2020 model KR165C rotary drilling rig seized in favor of the government for gross undervaluation and use of fake invoices and shipping documents last March 4, 2021.

The averted technical smuggling attempt would have cost the government a loss of over P1.3 million in customs duties and taxes, Mendoza added.

Per goods declaration, the shipment, consigned to ‘JLinks Marketing,’ is valued at $25,600.00 and was supported with a ‘Load Port Survey Report’ (LPSR) submitted by the representatives of the consignee.

Based on this declared value, the total payable duties and taxes was computed at only P159,390.00.

However, the vigilance of the attending customs examiner and appraiser paid off when, on further verification, they found out that the LPSR submitted by the consignee’s representatives was falsified.

It also turned out that the shipment is actually worth US$247,000 with duties and taxes assessed at Php1,472,774 or a discrepancy of more than 89 percent from the amount declared by the importer.

Under the Customs Modernization and Tariff Act (RA 10863), imported goods with more than 30 percent discrepancy in value are deemed ‘smuggled’ and liable to be seized by the BOC.

Subsequently, Mendoza said he issued a ‘WSD’ (warrant of seizure and detention) against the shipment for violation of Section 1113 in relation to Section 1400 of the CMTA.

Mendoza also warned those transacting with the POC from resorting to “similar deceitful schemes” as port assessment personnel as the port’s examiners and appraisers are thorough in the examination of the authenticity of importation documents.