The Bureau of Customs seized 48 brand-new Yamaha YZR R15 150cc motorcycles, chemicals and plumbing supplies with an estimated market value of P8-Million. The shipments were seized by the Bureau on grounds of technical smuggling.
The motorcycles, consigned to Motozentrum Philippines, Inc, arrived in the country through the Port of Manila in December 2013. In its import documents, the motorcycles were declared as being in “knocked-down condition,” or totally disassembled and had been shipped from Thailand. Moreover, the importer declared the shipment’s value at US$10,197.88 (P450,644.32). This means that each motorcycle would have only cost US$212.46 (P9,388.61) to purchase and ship to the country.
Following an Alert Order on the shipment by the Bureau’s Enforcement Group in January 2014, a 100% document and physical examination revealed that the motorcycles were already in “completely built-up” condition, with only the front wheel left to be attached, contrary to what the consignee had declared. Furthermore, the consignee had erroneously declared that the shipment came from Thailand when the Invoice, Packing List and Bill of Lading from the vessel clearly indicate that the ship came from Calcutta, India. A check on the shipment’s declared value revealed that the suggested selling price for the Yamaha YZR R15 150cc motorcycle in India is US$1,812.00 (P80,072.28), a discrepancy of about 85% compared to the declared value per unit of US$212.46 (P9,388.61). Under Section 2503 of the Tariff and Customs Code of the Philippines, any discrepancy between what was declared and what was found that exceeds 30% is gross undervaluation, which constitutes prima facie fraud.
The Bureau also seized two 20-foot container vans of what was declared as “Phthalic Anhydride,” but was found to actually contain “lead bromate pigment,” for gross undervaluation and violation of Republic Act 6969 (Toxic Substances and Hazardous and Nuclear Wastes Act of 1990), which regulates the importation, manufacture, processing, distribution, use, transport, treatment and disposal of toxic substances and hazardous and nuclear wastes in the country. The shipment, consigned to Frebel Enterprises, arrived in the country in March 2014. Lead bromate, used in making certain types of glass, is a poisonous chemical and may detonate explode on heating, striking or rubbing when combined with other substances.
Lastly, the agency seized one 40-foot container van imported by Unipipe Phils, Inc, filled with pipes, fittings and valves that had also been grossly undervalued. The shipment arrived at the Port of Manila in January 2014.
“Many of the importations that are alerted and seized have valuation issues as importers attempt to cheat on paying the correct duties and taxes by dramatically lowering the value of the items they import. It is easier now to check on the value of most imported goods. Let this be a lesson to all importers and brokers that any misdeclaration made on import entries is a form of technical smuggling and will be dealt with accordingly,” said Willie Tolentino, Director of the Enforcement and Security Service of the Bureau of Customs.
With these findings, the owners and licensed customs broker of Motozentrum could face smuggling-related charges for the fraudulent importation.
About 70% of shipments with Alert Orders issued by the Bureau yield negative findings. These include undervaluation, misdeclaration and lack of required import permits from regulatory agencies. Stricter enforcement and monitoring have increased the Bureau’s collections in past months, with valuation increasing by 18% and Duties and Taxes by 19% in the first three quarters of 2014.