Marcos eyes pre-shipment scan of agri products to 'minimize' smuggling

Metro Manila (CNN Philippines, May 26) — President Ferdinand Marcos Jr. on Thursday said he is considering implementing pre-shipment inspections for agricultural goods to stop the smuggling of the commodities.

The Palace said the move was recommended by top officials of the Société Générale de Surveillance SA (SGS) during their meeting with Marcos.

"This scheme would minimize smuggling. It will be essentially… pre-shipping inspection," Marcos said, quoted by Malacañang.

"Ibig sabihin, bago pa isakay 'yung produkto sa barko doon sa pinanggagalingan, inspeksyunin na nila para sasabihin nila, 'totoo ito, tama ang timbang, tama ang quality, tama ang nasa record na pinanggalingan' all of these items," he added. "Para hindi na natin kailangan gawin dito sa Pilipinas."

[Translation: It means that even before the products are loaded onto ships from the point of origin, they would be inspected to check if the weight, quality and records are correct. All of the items. So that it doesn't need to be done in the Philippines.]

Marcos said the Palace will extend to cover agricultural invoices so that prior to the arrival of the planes or ships, shipments are paid already, speeding up the process.

There is also the need to conduct cost analysis first to make sure that no added burden will be imposed on consumers, he added.

The Palace cited the UN Commodity Trade data for the Philippines and said some 20.48% discrepancy in the reported values of agricultural imports from 2010 to 2021 were found.

These reported discrepancies resulted in government revenue losses.

Other parts of the data show that for edible vegetables, roots and tubers, the discrepancy was 34.74%. For swine meat (fresh, chilled or frozen), the discrepancy was at 41.89%.

The data also said conducting pre-shipment inspection (PSI) and conformity assessment procedures would ensure that the quantity and other specifications of the goods conform with sanitary and phytosanitary import permits and test the presence of diseases, among others.

SGS claims this would address smuggling and contain the spread of diseases such as African Swine Fever and Avian Flu, clarifying also that inspection and testing fees would be paid for by the exporter.

Under the arangement, the Palace said SGS will create a digital invoice in a standardized format prescribed by the authorities on an online government platform for registered or authenticated agricultural exporter/seller/supplier.

The invoices would be available in real-time to the Department of Agriculture (DA), Bureau of Internal Revenue (BIR), and Bureau of Customs (BOC), which, according to SGS, would deter importers from manipulating or falsifying invoices and, instead, increase tax compliance, and enable cross-agency trade data reconciliation.

The system will likewise ensure that all agricultural importations are recorded and accounted for to prevent hoarding and price manipulation.

Costs of registration/authentication and operating the platform would also be paid for by the exporter.

Marcos has directed the Department of Finance (DOF) and the DA to study the proposal and come out with a mechanism to implement it.

SGS is a testing, inspection, and certification company established in 1878 to ensure the quality and safety of products based on health, safety and regulatory standards.

The Swiss company has 2,650 offices and laboratories, and employs 97,000 personnel in 140 countries.

The Philippines contracted the SGS from 1986 to 2000 for the verification of the quality, quantity, and price of imported goods prior to shipment to the Philippines.

SGS is currently working with the DOF on the fuel marking program.