AT the end of last month, the Bureau of Customs (BOC) raided a cold storage facility in Nueva Ecija, which resulted in the seizure of P35.4 million of smuggled onions and garlic, most sourced from China, but some apparently having been produced in the Netherlands. From the BOC point of view, the enforcement operation was a success, having stopped illegally imported products from reaching the market, and thereby undercutting our own farmers.
We would certainly not disagree with this, and the BOC’s enforcement arm deserves due credit for doing its job in the constant fight against the pernicious problem of smuggling. However, no matter how effective the BOC is, without the proper tools it cannot possibly catch them all; one warehouse in Nueva Ecija is raided, but how many more continue to evade detection?
It is not just agricultural goods that are a problem. The recent earthquake in southern Mindanao, as well as the shocking collapse of a building in Angeles City a few weeks ago, have raised questions about the quality and legitimacy of other imported products, particularly steel reinforcing bars (rebar) used in copious quantities for construction here in the Philippines. While detailed investigations are far from being completed, there are already suspicions that the Angeles accident and building collapses during the earthquake may have been at least partly attributable to low-quality and potentially smuggled materials.
The reasons for this is that even though the Department of Trade and Industry (DTI), through the Bureau of Product Safety (BPS), mandates strict and earthquake-compliant standards for rebar used in construction, what is produced here is a drop in the bucket compared with demand, so the larger part of the supply is imported.
It is very likely that neither of these issues, the smuggled onions and garlic in Nueva Ecija nor the suspected substandard rebar exposed by recent disasters would have ever happened if the country implemented a better system of import monitoring. The frustrating part of this is that such a system has already been created, and in fact, there has already been a presidential mandate with a timeline to implement it.
This is a subject we have taken up before, in July of last year, but as no significant progress has been made to this point, it seems the government and concerned stakeholders need some further prodding.
On May 13, 2024, President Ferdinand Marcos Jr. signed Administrative Order (AO) 23, directing the Bureau of Customs and concerned agencies to facilitate the implementation of two critical tools to curb smuggling, the pre-border technical verification (PTV) and cross-border electronic invoicing (CEI) programs. The intent of these programs was to give some teeth to the Anti-Agricultural Economic Sabotage Act (RA 12022), as well as combat other forms of smuggling, and AO 23 mandated a two-year deadline to bring PTV and CEI into full implementation.
That deadline expired a little over a month ago, and yet PTV and CEI are still pending. Briefly, PTV is a system by which Philippines-bound export shipments are verified prior to leaving their ports of origin, while CEI is a system by which the invoices for export shipments are filed to the BOC electronically from the countries of origin. The two processes together have the goals of first, virtually eliminating the scourge of technical smuggling by making it all but impossible to misdeclare imported goods, and second, by helping to speed up the entry of imported goods, because inspections upon arrival and hand-processing of invoices and other import documentation are reduced.
What followed AO 23 was a tortuous process of trying to get the programs up and running. For the BOC’s part, there was no disagreement with the order, only a need to carry out some systems upgrades and personnel orientation, which current Customs Commissioner Ariel Nepomuceno began lobbying for resources to complete as soon as he took his post in July 2025. Even before Nepomuceno arrived, the Department of Finance (DOF) had drafted (in August 2024) and then finalized (in January 2025) Joint Administrative Order (JAO) 001-2025 to implement the instructions of AO 23, but that is as far as the project has gotten until now.
Despite a period of about four months for public consultations and inputs to adjust the terms of JAO 001-2025, severe pushback by various business groups, importers, and later, even the US State Department put the implementation on hold by mid-June of last year. And as a result, the BOC is still fighting smuggling with one hand tied behind its back, unable, though willing — eager, even — to comply with the president’s two-year deadline.
