SC stops TRO on rice shipment from Davao

MANILA, Philippines—As Justice Secretary Leila de Lima pushed for a Cabinet-crafted policy on rice importation, the Bureau of Customs (BOC) has won a temporary victory over one of four court injunctions it is facing in connection with the entry into the country of rice shipments without import permits.

The Supreme Court on Tuesday stopped a Davao City Regional Trial Court order that restrained the BOC from seizing 91,800 bags of imported rice that a businessman had bought from a firm linked to David Bangayan aka David Tan. The shipment arrived two months ago without an import permit.

The high court issued a temporary restraining order (TRO) to stop the enforcement of the Dec. 12, 2013, order of Judge Emmanuel Carpio of Davao City RTC Branch 16 that prevented the BOC from seizing the shipment of Joseph Ngo.

Ngo bought the rice from Starcraft International Trading Corp., which is linked to Bangayan, who is suspected to be rice smuggler David Tan.

“The TRO is effective immediately and until further orders from the court,” said Supreme Court spokesman Theodore Te.

The high court acted on the petition for certiorari with application for a TRO, status quo order and/or preliminary injunction filed on Feb. 21 by Customs Commissioner John Phillip Sevilla and Agriculture Secretary Proceso Alcala as chair of the National Food Authority (NFA).

The petitioners told the high court that the injunction against the implementation of NFA Memorandum Circular No. AO-2K13-03-003, which requires rice imports to be covered by duly issued import permits, had “brought about the unbridled entry of smuggled rice from various countries to the detriment of the Filipino farmers.”

Protecting farmers

“Consequently, petitioners invoke the power of the honorable court to intervene, enjoin and strike down the baseless issuances of respondent judge which defeat the earnest efforts of the national government, particularly the NFA and the BOC, to curb the unlawful smuggling of rice into Philippine shores and protecting the local agriculture sector, especially the small farmers in the rural areas,” Sevilla and Alcala told the high court.

At a briefing, Te said the high court granted the TRO after it considered “meritorious the Office of the Solicitor General’s arguments regarding the lack of adequate representation of the BOC during the Regional Trial Court hearings and the lack of legal standing of Ngo to sue.”

The Supreme Court spokesman also said the high court required Judge Carpio and Ngo to comment on the petition against them within 10 days from receipt of its notice.

Complaint against judge

Carpio himself is a subject of an administrative complaint in the high court for issuing the order that prevented the BOC from seizing Ngo’s shipment.

The Samahang Industriya ng Agrikultura Inc. (Sinag) filed the complaint early this month. Sinag is an umbrella organization of 33 federations and various sectors of the agricultural industry.

The group sued Carpio for alleged gross misconduct and knowingly rendering an unjust judgment.

Rice importers have resorted to going to court and seeking injunctions against the BOC for holding their rice shipments.

Ngo, for instance, had told the Davao City Regional Trial Court that requiring an import permit on the importation of rice may no longer be imposed because the special treatment for rice importation under the World Trade Organization (WTO) had expired in June 2012.

The country is currently seeking an extension with the WTO.

De Lima, meanwhile, said she hoped the Cabinet would have discussions on the country’s rice importation policy following court injunctions preventing the BOC from implementing its no-rice import permit, no-entry policy.

Quantitative restrictions

The justice secretary said the existing policy was for the continued imposition of quantitative restrictions on the entry of rice imports into the country.

De Lima told reporters the rice policy was not purely a legal issue.

“It has to be a policy at a macro level. It cannot just be a purely NFA/DA matter,” she said.

She said rice importation had economic implications beyond agriculture. “We want a clear policy guidance.”

Massive smuggling

Some 2,000 container vans with 50,000 metric tons of rice were smuggled into the country weekly in 2013 (or 2.6 metric million tons annually), Deputy Customs Commissioner Agaton Uvero told the Senate ways and means committee last month.

Uvero said the massive rice smuggling was reportedly stopped last October, with the new leadership at the bureau.

Besides rice, other products are smuggled into the country.

From 2002 to 2011, the government lost more than P1.33 trillion in revenue due to smuggling through the country’s ports, according to the Federation of Philippine Industries.