The Bureau of Customs filed a P5 billion smuggling case today against Phoenix Petroleum Philippines, Inc., one of the leading independent oil industry players in the country which in 2009 was ranked 211th among the countries top 10,000 corporations.

Sued for various violations of the tariff and customs code, among them non-payment of excise and value-added taxes, non-submission of import documents such as invoices and bills of lading was DENNIS ANG UY, President/Chief Executive Officer of PHOENIX. Based on the company’s own press releases, Phoenix is perhaps the country’s fastest growing oil company considering that its first quarter revenue of P6.1 billion this year was 122 percent higher than the P2.75 billion it made during the same period last year. The company also reported a 97 percent increase in volume year-on-year.

Also included in the charge sheet were JORLAN CAPIN CABANES, a Davao-based customs broker and several JOHN DOE/S and JANE DOE/S, among them customs employees who conspired or colluded with other parties to defraud the government of much-needed revenues.

Customs Commissioner Angelito Alvarez said the agency’s Run-After-The- Smugglers (RATS) Group built the case against Phoenix Petroleum on the strength of an initial discovery of nine import entries that did not match the volume and value of the Load Port Survey (LPS) provided by the international surveyor contracted by the Bureau of Customs.

Subsequent verifications by the RATS Group revealed that between June 2010 and April this year, Phoenix made several importations of various petroleum products with a combined dutiable value P5,144,035,000.00.

Customs Deputy Commissioner Gregorio Chavez, concurrently the executive director of the RATS Group, disclosed that the subject importations were tainted by the following anomalies:

• some P459 million worth of imported petroleum products the company brought in between June and December 2010 cleared customs without any supporting import entry declarations, effectively depriving the government of lawful duties and taxes due on the said shipments;
• some 4.7 Billion worth of various imported products, while covered by 31 import entry declarations, were taken out of the Port of Davao and the sub-port of Bauan, Batangas between June 2010 and April 2011 despite the non-submission by Phoenix of the required importation documents such as invoices and bills of lading;

According to Chavez, Phoenix’s various sins of commission against customs revenue gave the Bureau of Customs sufficient justification to legally claim as restitution from Phoenix the total value of the fraudulent shipments which sums up to P5,144,035,000.00.

Alvarez said it was lamentable that while customs revenues had been adversely affected by the regime of duty free importations of petroleum products that took effect last July, companies such as Phoenix would cause further aggravation by resorting to illegal tax evasion practices.

Believing that large-scale cheating such as the one allegedly committed by Phoenix could not have been carried out without the connivance of customs employees, Alvarez instructed Chavez to file as soon as possible an amended charge sheet that would include the names of those who aided and abetted the fraudulent importations of the respondent company.

The customs chief also directed the agency’s Post-Entry Audit Group (PEAG) to audit all previous importations made by Phoenix prior to June last year. He said the company’s liability could increase by several billion pesos more if it could be established that it had used the same modus operandi in the past.