Days before the 1986 Edsa People Power Revolution, the Department of Finance and the World Bank awarded a five-year contract to Société Générale de Surveillance (SGS) of Switzerland for the Comprehensive Import Supervision Scheme (CISS) at the Bureau of Customs (BOC) after holding a competitive bidding.
The contract included preshipment inspections of cargo at their ports of origin prior to departure for Manila. The SGS was responsible for the valuation, classification and clearance functions for all imports. This way, smuggling was minimized and the “tara system” all but disappeared as customs officials were purely ministerial in function.
From 1987 to 1998, SGS-CISS increased customs collection at an average rate of 30.1 percent. This continued during Cory Aquino’s revolutionary government and the Ramos presidency although there were corruption issues hounding the Economic Intelligence and Investigation Bureau (EIIB), which was tasked then to monitor SGS.
Reports about EIIB’s money-making schemes eventually led to its abolition. And sadly, even the SGS contract was canceled by the Estrada administration in 2000.
Both the International Monetary Fund and Federation of Philippine Industries data show the government losing P200 billion in revenues yearly to sophisticated forms of “technical” smuggling involving petroleum, tobacco, cement and rice, among other products. Moreover, the country has become a transshipment port for international drug syndicates.
In 2007, then Trade Secretary Peter Favila suggested the return of third-party preshipment inspections either by SGS or other companies to stop rampant smuggling. But his recommendation was rejected by
customs officials and then President Gloria Macapagal-Arroyo.
Recently, President Duterte floated the idea of a “military takeover” of the BOC. Senate President Tito Sotto, on the
other hand, wants the bureau privatized but on the condition that it collects P600 billion annually for the government.
Actually, the problem does not lie with customs people alone but also with corrupt businessmen who use importers and brokers to find the fastest way to ensure the release of their shipment. They are the source of “tara money” circulating weekly at the bureau.
Here are my suggestions for newly appointed Customs Commissioner Rey Leonardo Guerrero:
First, allow third-party preinspection of all cargo at their ports of origin by internationally renowned companies such as SGS or Bureau Veritas to avoid smuggling and the entry of
illegal drugs.
Restore CISS and you remove corruption in the valuation of imports. You also get rid of the “red alert” scheme in which importers are asked for money if they want their shipment released.
I think government can now afford to pay as much as P10 billion a year if only to bring back integrity in our ports. This will also stop smuggling and prevent the entry of magnetic lifters containing drugs.
Second, Guerrero should appoint nonmilitary people and get trustworthy and the “least corrupt” career officials for his deputy commissioners. These insiders should know the technical and legal aspects of the port revenue operations.
Third, the commissioner should create a dynamic and powerful “counterintelligence group” with his military appointees to identify and arrest bribe-ready businessmen, smugglers and their cohorts. He should conduct a continuing no-nonsense lifestyle check initially on all port collectors, department heads and section chiefs.
Yes, we do not need a “military takeover” because I believe that most employees at the BOC are still honest and dedicated. But as I said before, this “cesspool” needs real cleansing.
For comments and suggestions, please e-mail jakejm2005@yahoo.com.