MANILA, Philippines—Claiming that a Supreme Court ruling upholding a government ban on the importation of used cars was wrong, administration Sen. Juan Ponce Enrile, also known by his initials JPE, Wednesday defended the entry of thousands of used vehicles into Port Irene in Cagayan, his home province.

Enrile brought along his son-in-law and used-car importers from Port Irene to the Senate to rebut a report by the American Chamber of Commerce (Amcham) that implied the Cagayan Export Zone (CEZ) in Port Irene had displaced Subic Freeport as the country’s entry point for imported second-hand luxury vehicles.

Enrile’s son-in-law, James Kocher, was part of the CEZ contingent that met the Amcham delegation, which visited Santa Ana, Cagayan, from May 12 to 14.

“He’s my son-in-law, my representative, to see to it that there is no smuggling. That’s my area. I don’t want anybody to smuggle there. If there will be smuggling there, that will be me. But modesty aside, I haven’t smuggled even a toothpick to this country,” Enrile said at a press conference.

Flourishing business

Enrile said Kocher operated the 50-hectare car yard, which is enclosed by 10-foot walls, “where all these cars go before they are registered so that there will be no smuggling.”

The operation of the yard is not a concession granted to his family, according to the senator.

Enrile, a former defense minister and acting customs commissioner during the Marcos regime, said that Port Irene’s flourishing used-car import business was legitimate and that the proper taxes on all units sold in the country had been paid.

Constitutionality of order

The senator threatened to question the constitutionality of Executive Order No. 156, a 2002 edict issued by President Gloria Macapagal-Arroyo and upheld by the Supreme Court in 2006, should Amcham and the Chamber of Automotive Manufacturers Philippines Inc. continue to push for a crackdown on second-hand vehicle imports.

EO 156 banned the importation of used vehicles for resale in the country, shutting down the multibillion-peso, used-car import business in Subic.

“The problem of car manufacturers will just get worse. The Supreme Court decision is wrong. With all due respect to them, they made a mistake,” Enrile said.

He said only Congress, not Malacañang, could ban any item from being imported, noting that the presidential decree amending the Tariff and Customs Code does not cite used cars among the banned items.

US state department

Enrile challenged Amcham, Ford, General Motors and others to show a single case of smuggling in Port Irene.

He specifically mentioned two members of the Amcham team who visited the port in May—John Forbes (who the senator claimed was introducing himself as part of the US state department) and Henry Co (chair of Ford Motor Philippines).

“I don’t care if he (Forbes) is from Timbuktu. Nobody can threaten me in my own area. Nobody can threaten me in this country. We are not doing anything illegal. If Mr. John Forbes or Mr. Henry Co can put up a plant to provide a cheap car for the people of this country, and affordable for ordinary people like you and like many ordinary Filipinos, we will close the operation in Port Irene,” the senator said.

Different market

Enrile disclosed that his group was in discussions with a foreign car maker that could build a car worth $4,000, which could run from 15 to 20 kilometers per liter of gas.

Enrile said Ford was sore because it could not boost its market share in the country as its units were expensive, gas guzzlers and took months to have a part replaced.

In the case of Japanese assemblers, Enrile said they were selling automobiles built overseas and thus were not deserving of the billions of pesos in incentives granted to them by the Board of Investments.

“The people who are buying cars in Port Irene cannot buy the cars assembled in this country, let alone the completely built-up units brought here. We’re serving a different market,” he said.

Worth defending

Enrile said the used-car business was worth defending because it served a market different from the one addressed by mainstream sellers.

“If a 1995 Pajero would be allowed by the government to run in the streets of Manila using the fuel that we have, why should not a model 1995 Pajero be allowed to be imported into this country and be used in the streets of Manila? What is the difference? Safety? Security? Health? What’s the basis?” he said.

As for his son-in-law, the senator said Kocher served as his personal representative when he and the CEZ contingent met the Amcham delegation.

“For the information of these malicious people, my son-in-law is there because I cannot go there to supervise the place. I told the locators, I will allow you to operate your business in Port Irene but no smuggling. Because I cannot go there to enforce the system,” Enrile said.

He said Kocher had nothing to do with smuggling. “If they will investigate him, what is his crime?” he asked.

Senate probe

“When the cars come to the free port, they go to a yard enclosed by a high wall and no car can get out from that yard without paying the correct taxes. Everything is recorded and we challenge anybody to go there, examine the records and find out if there are any cars that are smuggled,” he said.

The Senate committee on ways and means, chaired by Sen. Francis Escudero, is looking into smuggling in the country.

Although he refused to bill it as a “showdown,” Escudero said next month’s hearing would invite representatives from the Subic, Cebu and Cagayan free ports, along with officials of the car industry and foreign chambers, including Amcham.

“There will be no sacred cows in the hearing. Without fear or favor we will get the facts. It is not our intention to malign or destroy anyone but to simply get the facts and raise the revenues of government,” he said in a text message.

Enrile welcomed the Senate investigation but he denied that he would use the venue to “clean” his name.

“There’s nothing to clean,” he said.

Ermita defends Enrile

In Malacañang, Executive Secretary Eduardo Ermita defended Enrile, saying the senator’s home province is not a haven for car smugglers.

Ermita said he was “very sure” that the senator, who crafted the law creating the CEZ, would not allow his province to be a center of car smuggling in northern Luzon.

“I’ve known him. Who is (a national) leader that will condone illegal activities (in his own turf)?” Ermita asked.

Malacañang, however, ordered its own anti-smuggling task force to investigate the claim of the Amcham that the CEZ was being used by car smugglers.

“I asked the Presidential Anti-Smuggling Group (chief), Bebot Villar, to look at it and give us the report,” Ermita said. With a report from Michael Lim Ubac