MANILA - The Philippines has expressed disappointment over Thailand's failure to comply with the World Trade Organization's (WTO) ruling on the latter's unfair tobacco taxes.

The Department of Trade and Industry (DTI) today said the Philippines' response to Thailand's latest status report was presented during the WTO Dispute Settlement Body (DSB) meeting last July 23.

"While Thailand has made strides in implementing a number of measures, full compliance that adheres to WTO rules is yet to be realized. The bilateral engagements hoped to achieve this and it is, therefore, a disappointment for the Philippines that the information committed during the bilateral meeting has yet to be completely provided," Trade Assistant Secretary Ceferino S. Rodolfo said in a statement.

Rodolfo was referring to the bilateral discussions that he and Philippine Permanent Representative to the WTO Esteban B. Conejos Jr. attended in Bangkok last May.

In its July 11 status report, the Thai WTO delegation said Bangkok is working to fully comply with the multilateral body’s ruling.

"Thailand has continued to work on the issues discussed with the Philippines during the informal consultations that took place in Bangkok on May 3-4 and has provided additional information to the Philippines in this context. Thailand expects to provide the remaining information shortly and looks forward to continued discussions on the remaining outstanding technical issues with the Philippines and, as appropriate, with private stakeholders," the Thai WTO mission said.

But Rodolfo said Thailand is dragging its feet on compliance.

"[I]n the past three DSB meetings, the Philippines continued to elevate the issue that Thailand had not been able to address concerns that relate to the actions of certain [Thai] government agencies that appear to make findings on customs valuation issues without operating under the WTO Customs Valuation Agreement," Rodolfo said.

In June 2011, Bangkok lost the case that Manila lodged before the WTO in behalf of the Philippine unit of cigarette manufacturer Philip Morris. The WTO ruled that Thailand had been slapping discriminatory taxes on cigarettes coming from the Philippines.

To comply with the WTO ruling, Thailand last year adopted a royal decree abolishing the value-added tax (VAT) exemption enjoyed by resellers of locally made cigarettes, making them at par with imports, which were not VAT-exempt.

Thailand however has yet to attain full compliance with the WTO decision even as the reasonable period of time to comply lapsed in October last year.

The Philippine WTO mission had said the Thai Customs' Board of Appeals ruling on certain customs valuation entries of imported tobacco from 2002 to 2003 was "inconsistent" with WTO rules.

"Thailand's reference to additional guidance from its Revenue Department concerning amended VAT rules also raises questions of WTO-consistency," the Philippine WTO mission said last January.

The Philippines had been warning that it may hale Thailand back to arbitration.

"Thailand's adherence to WTO disciplines concerning customs valuation is of considerable systemic importance for the Philippines and Philippine exporters. Our guiding principle is to uphold and protect our national interest as we have fully preserved our rights in this dispute," Trade Undersecretary Adrian S. Cristobal Jr. said.

July 29, 2013 6:53 PM

By Ben Arnold O. De Vera

Source: InterAksyon.com