Case Summary (G.R. No. 158150)
Key Dates
July 19, 2001 – Agriex contracts for 180,000 bags to Indonesia; later 20,000 to Cebu.
July 27, 2001 – Charter of MV Hung Yen for shipment to Subic Freeport.
August 20, 2001 – Vessel arrival at Subic Freeport; berthing delayed until September 11.
September 12, 2001 – Warrant of Seizure and Detention (WSD) No. 2001-13 issued against 20,000 bags.
September 27, 2001 – Amended WSD No. 2001-13B issued covering remaining 180,000 bags.
October 18, 2001 – Collector issues Notice of Sale for all 200,000 bags.
November 12, 2001 – Agriex files petition for certiorari and prohibition in the CA.
February 4, 2002 – Commissioner’s Consolidated Order modifies forfeiture and release.
November 18, 2002 – CA denies petition as premature.
September 10, 2014 – Supreme Court decision affirming Bureau of Customs’ jurisdiction.
Applicable Constitutional and Statutory Law
1987 Philippine Constitution (post-1990 decisions)
Republic Act No. 7227 (Bases Conversion and Development Act of 1992) and its IRR (Sections 11 (f)(4), 52(a), 60(a))
Tariff and Customs Code of the Philippines:
– Section 602 (exclusive original jurisdiction of Bureau of Customs in seizure/forfeiture)
– Section 2530 (conditions for forfeiture)
– Section 2535 (burden of proof in seizure proceedings)
– Section 2313 (review by Commissioner)
– Section 2402 (appeal to CTA)
Customs Administrative Order No. 4-93 (operations in Subic Freeport Zone)
Republic Act No. 1125, as amended (CTA appellate jurisdiction)
Executive Order No. 272 (presidential approval threshold for public sale)
Factual Background
Agriex shipped 200,000 bags of Thai white rice via MV Hung Yen to Subic Freeport for transshipment: 180,000 bags to Fiji and Indonesia; 20,000 bags to Cebu. SBMA delayed vessel berthing. Bureau of Customs issued clearance to exit the vessel but subsequent verification revealed non-existent consignees in Indonesia and Fiji. On advisement from Customs’ investigators, Commissioner Villanueva directed seizure of the 20,000-bag parcel (September 12) and, after further investigation, the 180,000-bag parcel (September 27). The Collector then scheduled public auction (October 18).
Procedural History
Agriex moved to quash the WSDs and restrain the sale. Commissioner partially quashed the vessel WSD but upheld rice seizures. CA granted a Temporary Restraining Order against the October 18 sale but later denied the petition for certiorari and prohibition, holding it was filed prematurely and that the proper remedy was appeal to the CTA. Agriex did not timely appeal the Commissioner’s final order to the CTA.
Legal Issue
Whether the Bureau of Customs—and its Collector and Commissioner—had jurisdiction to seize and forfeit goods entering the Subic Freeport Zone and to issue the corresponding warrants of seizure and notice of sale.
Applicable Legal Framework
- Subic Freeport as separate customs territory under RA 7227 and IRR: allows free import/export but authorizes seizure of violative goods by Customs.
- Tariff and Customs Code grants exclusive original jurisdiction to Bureau of Customs over seizure and forfeiture proceedings (Sec. 602), with internal review by the Commissioner (Sec. 2313) and appeal to the CTA (Sec. 2402), not to regular courts.
- Probable cause requirement and burden of proof rules (Sec. 2535) satisfied by findings that consignees were non-existent or denied involvement.
- Customs Administrative Order No. 4-93 confirms seizure powers within Freeport.
Ruling on Jurisdiction
The Supreme Court held that the Bureau of Customs retains full authority to enforce customs laws—including seizure and f
...continue readingCase Syllabus (G.R. No. 158150)
Procedural History
- Agriex Co., Ltd. filed a petition for review on certiorari before the Supreme Court to overturn the Court of Appeals’ judgment in CA-G.R. CV No. 67593 promulgated on November 18, 2002.
- The CA had dismissed Agriex’s petition for certiorari and prohibition seeking to nullify the Notice of Sale dated October 18, 2001 issued by Collector Bibit.
- Agriex elevated the case by petition for review under Rule 45 of the Rules of Court; the Supreme Court assigned G.R. No. 158150 and promulgated its decision on September 10, 2014.
Antecedent Contractual Arrangements
- On July 19, 2001, Agriex, a Thai foreign corporation, contracted to sell 180,000 bags of Thai white rice to PT. Gloria Mitra Niagatama International (Surabaya, Indonesia).
- Shortly thereafter, Agriex contracted an additional 20,000 bags of Thai white rice to R&C Agro Trade (Cebu City).
- On July 27, 2001, Agriex chartered MV Hung Yen to transport 200,000 bags of rice to Subic Freeport for transshipment: 180,000 bags destined for Fiji Islands and Indonesia; 20,000 bags destined for Cebu City.
Arrival and Berthing of MV Hung Yen
- MV Hung Yen departed Bangkok on August 15, 2001, and arrived at the Subic Freeport on August 20, 2001 with an inward foreign manifest indicating transshipment destinations.
- The Subic Bay Metropolitan Authority (SBMA) delayed berthing for 22 days, finally allowing the vessel to dock on September 11, 2001.
- SBMA advised that import permits (initially issued for Cebu) be amended by the National Food Authority (NFA) to reflect Port of Subic as the new discharge port.
Customs Clearance and Seizure Actions
- August 24, 2001: Bureau of Customs (BOC) issued a Clearance of Vessel to a Foreign Port permitting MV Hung Yen and its cargo to exit for Labuan, Malaysia.
- MV Hung Yen did not depart on the scheduled date; on September 10, 2001, Agriex sought permission to unload all 200,000 bags so that the vessel could return to Vietnam.
- Commissioner Villanueva’s September 11, 2001 Indorsement directed Collector Bibit to issue Warrant of Seizure and Detention (WSD) No. 2001-13 against the 20,000-bag shipment consigned to R&C Agro Trade.
- On September 12, 2001, WSD No. 2001-13 was issued despite no unloading; on September 27, 2001, amended WSDs extended seizure to the vessel and the remaining 180,000 bags for transshipment.
- October 4, 2001: Agriex filed an Urgent Motion to Quash WSDs; October 18, 2001: Collector Bibi