A TRADE dispute may arise between the Philippines and Vietnam due to the decision of the Vietnamese government to unilaterally impose additional tariff on the products of Global Steel Philippines Inc. (GSPI).

Trade Undersecretary Thomas G. Aquino said demanding a compensation from Vietnam is an option if the Philippines determines that the allegation of the Vietnam Steel Association (VSA) that GSPI is not yet really producing the steel products it is exporting to Vietnam in its Iligan plant, but are merely transshipped from its mother unit in India, is not true.

This allegation made Vietnam slap the higher 7-percent MFN rate (tariff imposed on products originating from countries outside of Asean) to the GSPI products instead of the Asean Common Effective Preferential Tariff (CEPT) rates of only zero to 3 percent.

Aquino said the government will first ask Vietnam to “fully and convincingly substantiate” its claim.

“Later on, if needed, we will demand compensation,” Aquino told reporters.

Under the Asean Free Trade Agreement (Afta), a member-state can opt to recover losses incurred by its registered firms because of the unilateral imposition of tariffs of another country that is not consistent with the CEPT rules through a compensation package.

Aquino said the Philippine government will be playing by the rules and wait for Vietnam to answer its queries.

The VSA actually questioned the certification issued by the Philippine Bureau of Customs, stating that the cold rolled coils (CRCs) being produced by the Iligan-based GSPI are complying with the minimum requirement for local content of 40 percent to allow it to enjoy duty-free privilege in intra-Asean trade.

VSA alleged that it is impossible for GSPI to export CRCs since it only started producing hot rolled coils (HRC), the raw material for CRC, on April 2006 on a trial basis.

Despite this, GSPI was reportedly able to export 41,733 tons of CRC worth $24 million into Vietnam from November 2005 to April 2006.

All of GSPI’s CRC shipments during this period, the VSA said, could have been trans-shipped from India to the port of Iligan and later on to Vietnam, giving the VSA reasons to believe that all of GSPI’s export documents had been forged.

The forgery could lead to 30 billion dong or $1.9 million in unpaid taxes by the GSPI.

“If this is proven, it will put the Philippines in a bad light,” he said.

At this time, however, Aquino said the government will be standing by GSPI and wait for more convincing evidence from Vietnam.

MAJOR alternative oil player Seaoil Philippines Inc. is hoping to increase to 500 its retail service stations in the country over the next three years.

A TRADE dispute may arise between the Philippines and Vietnam due to the decision of the Vietnamese government to unilaterally impose additional tariff on the products of Global Steel Philippines Inc. (GSPI).

THE European Union (EU) emphasized that the Philippines is among the developing countries to benefit the most in the proposed free trade agreement (FTA) between the EU and the Association of Southeast Asian Nations (Asean), saying the deal would pave the way for more investment opportunities and facilitate access of the Philippine products into Europe’s rich market.

THE Philippines would rally for the adoption of concessions that would commit rich countries in helping developing nations improve on their trade capacity and technical competence in the form of grants under the World Trade Organization’s “aid for trade” program.

The celebrated cases of the Quisumbings of Cebu involving some P900 million in damages, claims and inheritances may now have to go through the full route after Wesy B. Quisumbing, who is largely credited for rehabilitating the ailing Norkis-Summa Group of Companies starting in the 1980s but was later disowned by her parents allegedly for “exercising” her femininity, decided to withdraw from the mediation proceedings.