QuestionsQuestions (DA DEPARTMENT ORDER NO. 3, 16 OCTOBER 2002)
The legal basis for the imposition of the Special Safeguard Duty on imported onions is Republic Act 8800, also known as the Safeguard Measures Act, particularly Chapter III, Sections 21 and 23.
The product affected is imported onions, specifically those falling under the HS Code 0703.1000.
The regular customs duty on imported onions is 50% before the imposition of the Special Safeguard Duty.
The Special Safeguard Duty is imposed when the trigger price is breached, that is, if the average CIF import price of onions falls below the trigger price published.
The trigger price of onions mentioned is PHP 74.21 per kilogram, as published on August 7, 2002.
The SSG duty is computed based on the price difference between the trigger price and the CIF import price, using a tiered percentage rate system as illustrated in Annex A of the order. The calculation involves steps where different percentages apply depending on the price difference ratio relative to the trigger price.
The price difference ratio is calculated by dividing the difference between the trigger price (TP) and the CIF price (P) by the trigger price, i.e., (TP - P)/TP.
When the price difference ratio exceeds 75%, the SSG duty is calculated using a higher tier rate with percentages of 90%, 70%, 50%, and 30% applied to different segments of the price difference as defined by the formula in Annex A.
The data used includes the breach of the trigger price, the average CIF import price from January to July 2002 being below the trigger price, higher volume of onion imports in 2001 compared to previous years, and the increasing trend in monthly imports since March 2002.
The SSG duty is imposed on a shipment by shipment basis over and above the regular customs duty.
The Secretary of the Department of Agriculture, Leonardo Q. Montemayor, requested the imposition of the Special Safeguard Duty.
The volume of onion imports increased notably in 2001 compared to earlier years, with monthly imports continuing to rise in 2002 since March, suggesting increased import pressure which justified protective measures like the SSG duty.