The Philippine Supreme Court has lifted a special import tariff imposed by the government to protect local cement manufacturers.
The court decision is a victory for Southern Cross Cement Corp. - a cement importer owned by Japan’s Teiheiyo Cement Corp and Tokuyama Corp - which has questioned the validity of the 20.60-peso special tariff imposed by the government in December 2001 on each 40kg bag of imported cement. The import duty was pared to PHP15.60 per bag in March this year after local producers failed to lower their prices.
Domestic cement manufacturers have sought tariff protection from the government on grounds that they have been losing market share to cheap imports and laying off workers in the process.
The Supreme Court said the secretary of trade can’t issue a special tax protection after the Tariff Commission found there isn’t any need for it.
In its 2002 findings, the Tariff Commission recommended the removal of the special tariff since the surge in cement imports didn’t cause any "serious injury" to the local cement industry.
The local cement producers went to the Court of Appeals, which ruled that the trade secretary can issue the temporary tariff protection since the Tariff Commission’s findings are just recommendatory.
The appeals court ruling was the basis of the trade secretary’s extension of the special tariff.
The Supreme Court said the appeals court overstepped its jurisdiction and thus its ruling allowing that the trade secretary to issue the order is invalid.