Minimum human intervention seen as key to eradicating graft & corruption at BOC

Former Customs Commissioner Titus Villanueva, a veteran of 41 years in the BOC – said various reform programs in the BOC from simplifying procedures to computerization have not eradicated graft and corruption because of human intervention at the most crucial point in time. According to Villanueva, the key is to reduce to the barest minimum human intervention when speedy action is very much needed especially at the point of release of the cargoes to the importer.

Villanueva noted that Customs commissioners come and go and each has his own reform program toward reduction of graft and corruption at the BOC. Some of them were: Holding of periodic moral regeneration seminars among BOC personnel; shortening the processing time in the release of cargoes; reducing the number of signatures for the release of shipments from BOC; employment of Comprehensive Import Supervision System (CISS); computerization of selected BOC operations; and categorization of importers according to honesty and integrity or Selectivity System (SS).

Villanueva said that among the reform programs already undertaken, the SS and CISS were very effective in reducing graft and corruption but, for one reason or another, they did not last long; the SS because the accredited importers lost interest in the system and CISS because the system was costly.

The SS involves the classification of importers according to the channel where their imports would pass through. Honest or green importers have their importations pass through the green channel where physical examination of the cargoes and checks of import documents are no longer required.

The other Importers or red importers whose shipments pass through the red channel are subject to all the BOC import requirements such as physical examination of the cargoes, rigid verification of import documents, BOC alerting system, pre-audit of import entry declarations and other forms of safety checks.

It is estimated that green importers comprise 80 percent while red importers, 20 percent. Some importers lost interest in being accredited as “green” because their shipments still pass through the Customs personnel before release, hence, the opportunity for bribe or facilitation money.

The CISS is the employments of import supervisor who examines the cargoes in the country of origin and submits report on their value, tariff classifications and quantity. BOC employed CISS for about 15 years. It was conducted by the surveyor, a swiss firm. The reports of the firm were made mandatory for BOC to follow unless challenged before an inter-agency body composed of representative from concerned government agencies. Villanueva said the CISS proved to be very successful in reducing graft and corruption at the BOC. Proof to this was BOC personnel already taking jeeps and buses instead of riding in flashy cars in going to and from their offices, all because human intervention under this system was greatly reduced.

The CISS was successful and implemented for 13 years (1986-2000), Villanueva noted, adding that it was terminated through the recommendation of politicians on the pretext that it was costly.

Villanueva suggested that a modified SS and CISS on a limited scale be revived.

Under the modified SS, shipments of green importers would not anymore be subjected to Customs processing before delivery of the cargoes to the consignee’s warehouse. Their importations would be delivered immediately to the consignees upon arrival at the pier.

This would contribute in decongesting the pier. Direct transfer of shipments from the pier to the warehouse of the consignee would remove opportunities for BOC personnel to hold or delay the releases of shipments for superfluous and imagined reasons in order to exact facilitation or bribe money.

The duties and taxes would be paid later upon filling of the import entry declaration with the BOC. Companies such as Ayala Corp., San Miguel Corp. and other reputable multinational companies would qualify as green importers. To avoid chances of irregularities, random check while cargoes are being delivered should be conducted. This would ensure that green importers would police their ranks and maintain their positive status so that they could continue to enjoy the privileges given to them.

Without facilitation money, more honest and big importers would be encouraged to apply for accreditation under the green category. As a result, more importers would be applying under this category.

Under the CISS as modified, now known as ISS, only importations of red importers would be subject to the Import Supervision Scheme (ISS). The smaller import coverage would justify its revival because it would no longer be costly. As proven before, importations under ISS were graft-and-corrupt free.

To make the proposed solution last for a long time, Villanueva said there should be a carrot-and-stick approach to the proposal. At a given period of time, for maintaining a track record of honesty and integrity, the red importers may be reclassified as “green”.