Safeguard Duty: Boon Or Bane?

The Department of Trade and Industry has become more resolute in protecting domestic manufacturing industries with its aggressive move to exercise the right of the government to impose safeguard duty to stop the surge of imports of certain products as provided under the Safeguard Measures Act.

The process is long and tedious with two government agencies – DTI and the TariffCommission (TC) — trying to balance the implication of imposing a penalty against an imported product and to protect domestic industries. Local and foreign manufacturers, importers, and exporting countries are also involved in the process.

Upon preliminary determination, the DTI imposes provisionary duty while the TC conducts its own final determination of whether it should go with the DTI or recommends a negative recommendation. A negative TC recommendation would force the DTI to issue an order lifting the six-month provisional safeguard duty.

The most recent DTI orders involved the cement and motor vehicle sectors.

In the case of cement, it was easy because the TC agreed with the DTI findings. Now on its second year of the three-year safeguard duty, imported cement is slapped with a safeguard duty of ₱9.80 per bag.