DTI sets Feb. deadline for Thailand to comply with WTO tobacco ruling

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THE Department of Trade and Industry (DTI) said it is giving Thailand until February to comply with the World Trade Organization (WTO) ruling on its customs measures on Philippine cigarette exports before seeking recourse.

Trade Secretary Ramon M. Lopez told reporters after a news conference at New World Makati Hotel Wednesday that he will write a letter to his counterpart in Thailand this month.

“The general tone is for enjoining them to comply with the WTO ruling. We are all supposed to subscribe to the rules. It’s as basic as that. Otherwise, we will look into recourse, into other measures that will be available for us to take,” he said.

The decade-long dispute on Thailand’s fiscal and customs policies on imported cigarettes from the Philippines, where the WTO ruled in favor of the Philippines, is now facing new considerations that could delay Philippine retaliation.

The Thai courts recently fined Philip Morris Thailand $39.7 million after finding the company had undervalued cigarette imports from the Philippines to avoid taxes.

“We are looking closely at the details of that trade court’s decision,” undersecretary Ceferino S. Rodolfo said in the briefing, noting that DTI is now waiting for the official English translation of the decision.

“There was a positive finding with respect to the fines that will be imposed on the Thai importer of Philippine products. In effect, the Thai court decision disregarded [the] WTO case.”

He said that the decision works against the WTO ruling that favors the Philippines. DTI is currently working on communicating with the WTO through the Philippine Mission in Geneva.

The appellate body of the WTO may also not have enough members to function after Dec. 10, following the blocking of appointments from the Trump administration.

“We’re also looking carefully at what will happen to the appellate body of the WTO, because that will also have a material impact on the timelines as to whether Philippines can impose certain actions,” Mr. Rodolfo said.

DTI last month said that it was considering cross-sectoral retaliation against Thailand by the end of December, looking into imposing tariffs or quantitative restrictions on its automotive exports to the Philippines.

Mr. Lopez said Thailand is in the “ASEAN brotherhood of trade partners,” and offered the country a chance to comply with the WTO ruling.

Tumagal na ‘yung kaso ng 2011 or 2012. (The case has been going on since 2011 or 2012). We’re willing to wait a little more,” he said.

Mr. Rodolfo said that the DTI is looking after the interests of tobacco farmers.

“The Secretary wants to fight for this case — in addition to the Philippine exporters to Thailand, it’s because of the [tobacco] farmers that have been prejudiced by this case.” — Jenina P. Ibañez