By Bernie Cahiles-Magkilat
The Tariff Commission (TC) will issue its decision on the cement safeguards petition before September 10 when the provisional safeguards imposed by the Department of Trade and Industry (DTI) expires.
Commission Chairman Ernesto L. Albano told reporters they have the power to raise, lower the P8.40 provisional safeguard measure imposed by the Department of Trade and Industry secretary or not to impose any safeguard measure at all on imported cement.
Based on the timelines, he said, the TC is expected to come out with a decision before September 10, the date when the provisional safeguard measure lapses.
Under the rules of the Safeguard Measures Act (Republic Act 8800), if the TC decides in the affirmative, the DTI secretary can still improve or lower the safeguard duty the TC had decided. In this case, he said, the DTI secretary has the final say. But if the TC decision is negative, the DTI secretary cannot do anything about the decision.
The private sector, however, as represented by the Cement Manufacturers Association of the Philippines (CeMAP) can appeal the decision of the DTI or the TC to the Court of Tax Appeals.
The DTI conducted a motu propio investigation on the cement industry and in February this year imposed a provisional safeguard measure against imported cement amounting to P210 per metric ton or P8.40 per bag after finding an inordinate increase in cement imports since 2013 causing manufacturers to lose market share. The DTI move was based on the Safeguard Measures Act (Republic Act 8800) which protects domestic industries against import surges.
Based on its preliminary findings, the DTI said that cement manufacturers’ earnings fell sharply by 49 percent in 2017 while aggregate net income started sliding in 2016 by 29 percent and further by 78 percent in 2017. In the past five years, cement imports soared from 3,558 metric tons (MT) in 2013 to more than 3 million MT in 2017 and reaching almost 5 million MT in 2018.
In the first quarter of 2019, the volume of cement imports rose 64 percent to 1.74 million MT from 1.06 million MT in the first quarter of last year prompting CeMAP to call for a higher permanent safeguard.
CeMAP officials have expressed hope the TC will uphold the country’s interests in its ruling on the safeguard measure after the body’s own investigation validated the DTI’s findings of serious injury to local cement manufacturers caused by the “sudden, sharp and significant” increase in cement importation starting in 2016.