VACC files plunder, smuggling raps vs trade chief, Hyundai execs

Ina Reformina, ABS-CBN News

Posted at Feb 08 2018 05:42 PM

Lawyer Ferdinand Topacio of the Volunteers Against Crime and Corruption (VACC) files Thursday a complaint against Trade Secretary Ramon Lopez and executives of Hyundai Motors in connection with the P1.1-billion in preferential tax rates and customs duties allegedly accorded the latter. Johnson Manabat, ABS-CBN News

MANILA - A group of anti-crime advocates on Thursday filed charges against Trade Secretary Ramon Lopez and executives of Hyundai Motors in connection with the P1.1-billion in preferential tax rates and customs duties allegedly accorded the motor company.

The Volunteers Against Crime and Corruption (VACC) filed charges of plunder, estafa and technical smuggling against Lopez, who is also concurrent chairman of the Board of Investments (BOI), and several executives of the South Korean car-maker.

Lopez was accused of using his position to favor Hyundai after it was found to be non-compliant with qualifications for a lowered tariff rate.

Also impleaded were the following Hyundai officials: Mong-Koo Chung, chairman and co-chief executive officer of Hyundai Motor Company (HMC), Won-Hee Lee, president and co-CEO of HMC; Yong Suk Lee, president of HMC’s Asia and Pacific Regional Headquarters; HARI chairman emeritus Richard Lee; HARI chairman Edward Go; HARI vice chairman Conrad Marty; HARI president and CEO Maria Fe Perez-Agudo; HARI Board of Directors members Eleazar Reyes and Ladislao Avila Jr.; and HARI's customs broker of record Cristina Salvador.

Under Philippine laws, manufacturers of cars that qualify under the Motor Vehicle Development Program (MVDP) such as Hyundai Asia Resources Inc (HARI) shall be entitled to enjoy a preferential tariff rate of 1 percent in the importation of completely knocked-down units, parts, and components.

The company's manufacturing plant in Sta. Rosa, however, was found to be non-compliant with the said requirements as it lacked basic assembly processes. 

Lopez also allegedly gave Hyundai additional time to implement assembly processes in welding and painting to meet requirements for the lowered tariff rate.

“The facts of the case will also show a conspiracy between the respondents," the VACC said.

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The VACC argued that instead of paying only 1 percent in tariff for its imports, HARI should have been charged 30 percent.

A show cause order was issued against HARI and, subsequently, its registration as a participant in the MVDP was cancelled. 

The BOI denied the company's motion for reconsideration on Jan. 3. 

The car manufacturer was ordered to refund value-added tax and customs duties waived in the amount of P544.67 million and P557.72 million for Hyundai Eon and Hyundai H350 units, respectively.