OFFICIALS of Coca-Cola Femsa Philippines are facing an outright smuggling complaint before the Bureau of Customs (BOC) after it allegedly imported high fructose corn syrup (HFCS) without clearance from Sugar Regulatory Administration (SRA) which resulted to a discrepancy in government charges.
The complaint was filed on May 11 by deputy chief Edgardo Lumanog Jr. of the Sugar Anti-Smuggling Organization, a division of the Sugar Master Plan Foundation Inc. tasked to coordinate and provide relevant information to the BOC and SRA about sugar smuggling.
In the six-page complaint-affidavit, Lumanog alleged that the beverage giant committed outright smuggling after it imported HFCS from China, then withdrew the HFCS shipments without the SRA clearance, which was required by the regulatory government agency.
Coca-Cola also evaded the payment of the required fees under the SRA’s Sugar Order No. 3, which regulates the entry of HFCS in the country, the complainant added.
The sugar order became effective on March 10 following its issuance on February 24.
The order said the importer of HFCS must be registered with SRA and that applicants must also comply with the requirements otherwise, they will be penalized.
Based on the Custom Declaration, Lumanog said the imported shipments of HFCS ordered by Coca-Cola have continued to arrive in the Port of Manila even after the March 10 effectivity order.
Of the eight shipments, which arrived from March 10 to 15, five were released.
It is stated in the complaint that the dutiable value of the HFCS shipments was pegged at P70,162,244 while the assessment of the Customs was only P8,617,233, leaving a discrepancy of P61,545,011.
Lumanog said that elements of outright smuggling were present, including importing goods into the country, without complete customs prescribed documents or without being cleared by customs or other regulatory government agencies; and for the purpose of evading payment of prescribed taxes, duties and other government charges.
Under the sugar order, importers are required to pay the release fee of P30 per 50-kilo bag of raw sugar equivalent of the fructose – for HFCS, one metric ton is equivalent to 20 50-kilo bags of raw sugar.
Lumanog said that “it is clear that there is sufficient ground to engender a well-founded belief that Coca-Cola through the respondents committed outright smuggling.”
The complainant added that the respondents should be held criminally liable for the violation and should be penalized of imprisonment for not less than 12 years and one day, but not more than 20 years, or fine of not less than P15 million, but not more than P50 million, or both.
Named respondents in the complaint are Coca-Cola Femsa Philippines director/president/chairman/chief executive officer Washington Fabricio Ponce Garcia, chief finance officer Sunil Gupta, and directors Francisco Martinez Colunga, Jerri Liu, Juan Pablo Rodriguez, Sunil Ghatnekar, Johan Willem Maarten Jansen, and Macaria Saldua.
Lumanog said that he will submit a supplement or corroborating affidavits and other documents to supplement the complaint-affidavit to include other persons who conspired with the board of directors and officers of Coca-Cola or participated in the commission of the offense.