Rice trade restrictions seen as WTO violation

The National Food Authority (NFA) may no longer restrict rice importation because its power to implement quantitative restrictions (QR), or volume limits, on rice imports had expired in June 2012, according to a Department of Justice legal opinion sent to Agriculture Secretary Proceso Alcala.

Justice Secretary Leila de Lima issued the opinion dated Dec. 16 last year upon the request of Alcala and after the NFA and the Bureau of Customs were sued by importers for seizing rice shipments in Davao City and other ports outside Metro Manila due to lack of import permits.

Several importers, who challenged the Department of Agriculture and NFA’s position, managed to secure temporary injunction orders from courts in Davao, Batangas and Manila.

In her 12-page opinion, marked confidential, De Lima said the Philippines had yet to get an extension of the QR.

De Lima said any extension of the quota on agricultural products “shall only be by agreement after the conduct of negotiations.”

“To renege on this agreement, consent to which was manifested by the act of both the President and the Senate in accordance with the Philippine Constitution, is beyond the power of a mere implementing agency like the NFA, which must exercise its rule-making and regulatory powers in accordance with, and not contrary to, applicable laws,” the opinion said.

Under the terms of the agreement’s Annex 5, the right to impose QR on rice, being a primary agricultural product, was granted to the Philippines, by virtue of its being a developing country, during the 10-year implementation period of full liberalization of world trade.

The NFA derived its power to maintain a quota on rice from Republic Act No. 8178 or the 1996 Agricultural Tarrification Act.

However, De Lima said that  owing to the expiry of the special treatment granted by the World Trade Organization (WTO), the NFA can no longer invoke RA 8178.

“The WTO provisions on the lifting of quantitative restrictions as well as their exceptions, and the provisions on negotiations for its extension are already effective and should be complied with. It is not for nothing that the Philippine government gave its consent to the WTO agreement,” De Lima said.

The QR implemented by the Philippines imposes a 40-percent duty on rice entering the country under the minimum access volume (MAV) of 350,000 metric tons. Imports outside of the 350,000 metric tons MAV are levied a higher tariff of 50 percent.

As the debate over importation rages, ordinary Filipinos assailed the uninterrupted rise in rice prices that has now breached the P40-per-kilo level.

Rafael Mariano, chair of the militant Kilusang Magbubukid ng Pilipinas, called the spiraling hike in the price of rice as the “height of injustice” to Filipinos.

Mariano said part of the reason that prices are increasing was the control on supply being exercised by unscrupulous traders.

“The big volume of rice in the country is not with the NFA but in the hands of a cartel,” said Mariano in a telephone interview. With a report from Delfin T. Mallari Jr., Inquirer Southern Luzon