The Court of Tax Appeals (CTA) has denied the petition of five cement trading companies against the safeguard duties imposed by the government in 2019 on cement importations.

In 2018, the Department of Trade (DTI) conducted a probe on the increased importations of cement.  The investigation showed there was an increase in the volume of cement importations from 2013 to 2017, and the market share of domestic manufacturers declined.

The DTI then tasked the Tariff Commission (TC) to determine the merits of imposing a definitive safeguard measure on importations of cement, and it recommended the application of a "general safeguard measure" on the importation of cement to prevent the imminent occurrence of serious injury to the Philippine cement industry.

The DTI then issued Department Administrative Order (DAO) No. 19-13 on Aug. 27, 2019, imposing safeguard duties for three years on the importations of cement. 

Under DAO 19-13, the amount of the safeguard duty to be imposed for the first year was P250 per metric ton (MT) or P10 per 40-kilogram bag of imported cement; P225 per MT on the second year; and P200 per MT for the third year.

Cohaco Merchandising & Development Corp., Fortem Cement Corporation, NGC Land Corp., Pabaza Import and Export, Inc., and Philcement Corporation then filed a petition for review before the CTA. The firms claimed that DAO 19-13  is "invalid" since there is no threat of serious injury to the domestic cement industry.

Named respondents in the petition were the DTI, the TC,the Bureau of Customs (BOC), the Department of Finance (DOF).

The five firms pointed out that the domestic supply of cement was inadequate to meet local demand, and the increase in the importation of cement was necessary to augment the supply gap.

However, the CTA found their petition lacking in merit. "Contrary to petitioners' arguments, the Court finds that the TC's findings were adequately explained and supported by data or information gathered from different parties.... Hence, the TC's factual findings must stand," the CTA ruled.

The CTA also pointed out that the petitioners did not contest the validity of the data in the Final Report and even cited them, although drawing different conclusions. But the CTA said that "the TC's conclusions are accorded great respect owing to its expertise and specialization."

"In sum, petitioners having failed to convince the Court that the TC and DTI Secretary's findings and conclusions were tainted with unfairness or arbitrariness or that these administrative bodies have grossly misappreciated evidence or acted in grave abuse of discretion, these findings and conclusions should be accorded great respect, and even finality," the decision said.

The 43-page decision was written by Associate Justice Ma. Belen M. Ringpis-Liban with the concurrence of Associate Justice Corazon G. Ferrer-Flores.