By means of Kyle Aristophere T. Atienza, Reporter
Philippine President Ferdinand R. Marcos Jr. signed a law Thursday that classifies agricultural smuggling, hoarding, profiteering and financing these crimes as acts of economic sabotage.
But experts said the law could become useless in a country notorious for failing to arrest major criminals, adding that having a local economy designed to meet local agricultural needs is best deterrent against smuggling.
The law will enter the books as Republic Act No. 12022, the Anti-Agricultural Economic Sabotage Act.
Under the law, violators can be fined five times the value of smuggled or hoarded agricultural products and face life imprisonment, the Agriculture Ministry said in a statement.
The law treats the smuggling and hoarding of agricultural food products as economic sabotage when the value of goods exceeds 10 million euros, the law said.
“Creating cartels and financing smugglers and hoarders will also be considered economic sabotage.”
Agriculture stakeholders expressed their opposition to the final version of the bill in August after a bicameral conference committee raised the threshold for agricultural smuggling as economic sabotage from P3 million to P10 million.
“Given such an increase, the entry of seven containers of smuggled rice, four containers of smuggled fruits and vegetables, two containers full of smuggled chicken or even one shipping container full of smuggled pork products would still not qualify as economic sabotage,” they said. said in a letter addressed to Mr. Marcos.
“Despite the illegal entry of such a huge quantity of agricultural products, it will be virtually impossible to punish these smugglers with the harsher penalty of life imprisonment imposed by the bill,” they said.
“In this way, the deterrent effect against agricultural smuggling is greatly reduced.”
The presidential palace had not yet issued a copy of the signed law, but a government handout distributed at the signing ceremony said the law’s penalties are intended to “protect the economy, preserve fair competition and ensure the well-being of producers.”
It says the law grants “jurisdiction” over violations to the Court of Tax Appeals.
Senate President Francis Joseph G. Escudero said in a statement that the law punishes those who commit acts that help commit agricultural economic sabotage — such as the transportation and storage of the smuggled goods — with 20 to 30 years in prison. and a fine equal to twice the value of the agricultural and fishery products.
The law covers agricultural and fishery products such as rice, corn, beef and other ruminants, pork, poultry, onions, garlic, carrots and other vegetables, according to a government brochure.
The products covered by the law also include palm oil, palm olein, raw and refined sugar, tobacco, fruit, salt, fish and other aquatic resources in the raw state or which have undergone the simple process of preparation or preservation for the market within the primary sector. and post-harvest stages of the food supply chain.
‘WEAKNESSES’ OF THE NEW LAW
Former Agriculture Secretary Leonardo Q. Montemayor said that while the new law was a major improvement over the 2016 Anti-Agricultural Smuggling Law in terms of comprehensive coverage and enforcement structure, there were still weaknesses, including the “exclusion of farmers and commodity producers” as permanent. members of the Anti-Agrarian Economic Sabotage Council.
The council is chaired by the president or a designated permanent representative.
Members include the heads of the Department of Agriculture, the Department of Justice, the Department of Finance (DoF), the Department of the Interior and Local Government, the Department of Transport, the Department of Trade and Industry, the Anti-Money Laundering Council and the Philippine Council. Competition Commission.
A bicameral conference committee in August excluded seven representatives from the agricultural sector as regular members of the Council. Instead, they will be part of an advisory body that can only be called upon when necessary.
Under the reconciled version of the bill, the DoF was included as a member of the Anti-Agricultural Economic Sabotage Enforcement Group, a move that went against calls from agricultural stakeholders to prevent the Bureau of Customs (BoC) from having any participation to the enforcement team.
In their August letter to the President, stakeholders said the inclusion of the DoF “effectively defeats the intention to intensify check and balance mechanisms in the BoC.”
They said the enforcement group should remain an independent body and be limited only to law enforcement agencies such as the National Bureau of Investigation, the Philippine National Police and the Philippine Coast Guard.
Mr Escudero said in his statement that chasing smugglers would also mean plugging leakages in the government’s revenue stream.
“The law will also result in improved collections by our collection agencies, which will translate into the delivery of more services to our people.”
Former Secretary of Agriculture William D. Dar said there should be no political considerations in implementing the law.”
“The law is made more effective with many harsh penalties, including a whole-of-government approach, with the president presiding over the Council,” he said via Viber.
Federation of Free Farmers national director Raul Q. Montemayor said the increased penalties under the new law “will be useless if we cannot arrest and prosecute alleged smugglers and hoarders.”
“This is what happened under the old law,” he said in a Viber message.
The Marcos government has largely blamed rising agricultural commodity prices on smuggling and hoarding.
Philippine inflation fell to 3.3% last month, slower than July’s 4.4%, due to a moderate increase in food prices and a drop in transportation costs.
Rice inflation, which has caused the country many headaches in recent months, fell to 14.7% from 20.9% in July and 22.5% in June. Still, the economy remained the largest contributor to inflation at 3.3% in August, which was within the government’s target range of 2%-4%.
Authorities last week flagged more than 800 container cars of imported rice found at a Manila port.
The 888 container trucks transported 23,000 tons of imported rice, or 0.75% of the total supply that entered the country this year.
Secretary of Agriculture Francisco P. Tiu Laurel, Jr. said recently that the majority of containers were still within the 30-day holding period allowed by the ports, citing the Philippine Ports Authority’s statement on Monday that more than 300 containers had already been claimed by their consignees.
INCREASED DOMESTIC PRODUCTION
“The problem of smuggling could easily be solved if the local economy would meet the needs of the people,” said Leonardo A. Lanzona, an economics professor at Ateneo de Manila University.
“Smuggling only becomes lucrative because we don’t produce most of our agricultural products,” he said in a Facebook Messenger chat.
The Philippines is highly vulnerable to imported inflation as the country imports much of its food. Agricultural imports amounted to $17.92 billion in 2023.
To curb food inflation, Mr. Marcos issued an executive order earlier this year that lowered the tariff on imported rice to 15%.
“The reduction in tariffs should have made smuggling less profitable. In short, if smuggling ever remains a problem, the only way to solve it is to increase domestic production,” Mr Lanzona said.
“Government money would be better spent subsidizing farmers than setting up these councils.”
In my opinion, the success of this new law depends heavily on the governance and integrity of those charged with its implementation,” said Marie Annette Galvez-Dacul, Executive Director of the Center for Food and Agribusiness at the University of Asia and the Pacific (UA&P) in a Viber message.