The Tariff Commission has postponed the scheduled public hearing next week on the formal investigation on whether to apply a definitive safeguard measure on ceramic floor and wall tiles to give concerned parties more time to comply with their requirements.
In a notice issued on Monday, the tariff body said it is moving to a later date its public hearing scheduled from August 12 to August 16. The public hearing is part of the tariff body’s formal investigation on the imposition of safeguard measure against importations of ceramic floor and wall tiles.
The Tariff Commission decided to defer the public hearing “to allow the submission of required information by interested parties and give this commission additional time to complete its data verification.” The tariff body, however, did not specify when the new schedule will be.
The Tariff Commission is investigating on whether to impose a definitive safeguard measure on imports as endorsed by Trade Secretary Ramon M. Lopez. Under Department Administrative Order 19-11 issued in May, the Department of Trade and Industry (DTI) imposed a safeguard duty of P3 per kilogram on ceramic floor and wall tiles.
The provisional duty was placed to protect local manufacturers, who complained their market share and profits were seriously injured by the import surge between 2013 and 2017.
This claim was validated by the DTI in its preliminary investigation, and moved to enforce a protectionist measure on ceramic floor and wall tiles. In its order, the agency reported imports increased from 2013 to 2016 and only slightly lowered in 2017, resulting in the reduction of the domestic industry’s market share to 15 percent in 2017, from 96 percent in 2013.
“The share of imported ceramic wall and floor tiles grew from 4 percent in 2013 to 87 percent in 2016,” the DTI order read.
“Earnings before interest and tax exhibited a declining trend of 71 percent in 2014, a sharp decline of 203 percent in 2015 when the operations resulted to loss, an increase of 92 percent in 2016, which means that there was an improvement in operation compared to 2015, but the industry remained at loss. In 2017 the industry’s operation continued to exhibit losses with the highest decline of 1,067 percent and further decline of 157 percent in 2018,” it explained.
At the preliminary conference of the Tariff Commission, importers warned the application of safeguard duty on ceramic floor and wall tiles hits the poor the most.
Importers said cheap tiles commonly used for low cost and socialized housing could increase prices by as much as P33 per piece. Cheap tiles, they said, usually weight at least 11 kilos.
Importers added they will pass on to consumers the additional finances brought about by the safeguard duty, as they reported the difference between their landed cost and selling price is around P20 to P30—shouldering the cost of provisional duty without passing them to buyers will apparently incur them losses.
They argued the Tariff Commission should side with them on the matter, as the protectionist measure real estate projects intended for the poor. Cheap tiles are usually placed as flooring of socialized and low cost houses.