Dennis Uy, Phoenix Petroleum under fire from Customs

Davao City-based Phoenix Petroleum is one of the leading independent oil industry players in the Philippines, which in 2009 was ranked 211th among the country’s top 10,000 corporations.

Davao City-born Dennis Ang Uy is  president of Phoenix.
Davao City played key role in the history of Phoenix as host to its first gas refilling station. Phoenix now has more than a hundred gas stations in the Visayas and Mindanao.
Phoenix Petroleum carries the pride of being the only corporation in Davao City that landed in the list of top corporations in the Philippines.
The Bureau of Customs (BOC) filed last month before the Department of Justice (DOJ) a P5-billion smuggling case against Phoenix Petroleum Philippines Inc. (Phoenix
Phoenix is one of the leading independent oil industry players in the Philippines, which in 2009 was ranked 211th among the country’s top 10,000 corporations.
 
BOC Commissioner Angelito Alvarez said that charged for violations of the Tariff and Customs Code, among them non-payment of excise and value-added taxes, non-submission of import documents such as invoices and bills of lading, was Dennis Ang Uy, president and chief operating officer of Phoenix.
Alvarez added that based on the company’s own press releases, Phoenix is perhaps the country’s fastest-growing oil company considering that its first quarter revenue of P6.1 billion this year was 122 percent higher than the P2.75 billion it made during the same period last year.
Dennis Uy with Manny Pacquiao at opening of a Phoenix gas station in General Santos City
DENNIS UY WITH MARIAN RIVERA (center) AT LAUNCH OF THE ACTRESS AS PHOENIX PRODUCT ENDORSER
The company also reported a 97 percent increase in volume year-on-year.
Also charged were Jorlan Capin Cabanes, a Davao-based customs broker and several John Does and Jane Does, among them customs employees who allegedly conspired or colluded with other parties to defraud the government of much-needed revenues.
THE RATS DRIVE
Alvarez stressed that the BOC’s Run-After-The-Smugglers (RATS) Group built the case against Phoenix on the strength of an initial discovery of nine import entries that did not match the volume and value of the Load Port Survey (LPS) provided by the international surveyor contracted by the BOC.
Subsequent verifications by the RATS Group showed that between June 2010 and April 2011, Phoenix made several importations of various petroleum products with a combined dutiable value of P5,144,035,000.
BOC Deputy Commissioner Gregorio Chavez, executive director of the RATS Group, disclosed that the subject importations were tainted by the following anomalies:
THE ANOMALIES
* Some P459-million worth of imported petroleum products the company brought in between June and December 2010 cleared Customs without any supporting import entry declarations, effectively depriving the government of lawful duties and taxes due on the said shipments;
* Some P4.7-billion worth of various imported products, while covered by 31 import entry declarations, were taken out of the Port of Davao and the sub-port of Bauan, Batangas between June 2010 and April 2011 despite the non-submission by Phoenix of the required importation documents such as invoices and bills of lading.
Alvarez said that Phoenix’s various sins of commission against Customs revenue gave the BOC sufficient justification to legally claim as restitution from Phoenix the total value of the fraudulent shipments which sums up to P5,144,035,000.
He said that it was lamentable that while customs revenues had been adversely affected by the regime of duty free importations of petroleum products that took effect last July, companies such as Phoenix would cause further aggravation by resorting to illegal tax evasion practices.
Likewise, Alvarez instructed Chavez to file as soon as possible an amended charge sheet that would include the names of those who aided and abetted the fraudulent importations of Phoenix.
The BOC chief also ordered the agency’s Post-Entry Audit Group (PEAG) to audit all previous importations made by Phoenix prior to June 2010.
Alvarez said that Phoenix’s liability could increase by several billion pesos if it could be established that it had used the same modus operandi in the past.
SOMETHING FISHY
Davao City Vice Mayor Rodrigo Duterte smells something fishy behind the filing of smuggling and tax evasion cases the Bureau of Customs (BOC) against Davao City-based Phoenix Petroleum Philippines Inc.
Duterte said that the smuggling and tax evasion cases were filed against Phoenix because of its refusal to be bought out its competitors.
Duterte said it was Dennis Uy, Phoenix president and chief executive officer, who told him that two companies wanted to buy out the city-based independent petroleum company, but Uy refused.
Uy reportedly said the two companies have connections with top BOC officials.
Why force someone to sell his company if he does not want to? Duterte asked.
nogie duterte
Ironically, while Duterte defended Uy and Phoenix, Uy partly-owned a local paper that spearheaded the black propaganda against Duterte and his daughter now Mayor Sara Duterte in the May elections last year.  Mayor Sara Duterte defeated former Speaker Prospero Nograles in the mayoral race by more than 200,000 votes. Now defunct, the Mindanao Daily was edited by Virgilio Bermudez, a known media handler of Nograles, during the campaign period in last year’s elections. At the approach to the election, Roger Balanza, the Mindanao Insider executive editor, resigned from the paper after Bermudez sold the daily to Nograles. Balanza played key role in the Sara Duterte-Nograles fight as head and media strategist of the Duterte camp media bureau. To fight off the Mindanao Insider which carried the propaganda of Nograles, Balanza published THE DURIAN POST in support of the Sara Duterte campaign.
Lawyer Raymond T. Zorilla, Phoenix assistant vice president for external affairs, said the company has yet to receive a copy of the case.
Duterte made the statement after Uy reportedly asked his help after his company was accused of failing to pay P5 billion in taxes for importation of oil products.
Duterte assured Uy of his help provided the imported products were clean even as he dared Phoenix to seek an independent investigation to clear its name.
Uy assured Duterte, in return, that Phoenix did not commit any violation.
Duterte, however, said he was surprised why BOC’s announcement of the case came before its actual filing.
OMBUDSMAN
Customs broker Jorlan Cabanes has filed a complaint at the Office of the Ombudsman against Alvarez and Deputy Commissioner Gregorio Chavez for accusing him of conspiring to smuggle oil products with Phoenix.
Cabanes, of Seadove Maritime Services Inc., described as malicious and baseless the accusations made Alvarez and Chavez.
Uy, through his lawyers, also sued the Customs officials at the Ombudsman.
Fraudulent shipments
For its alleged fraudulent shipments worth P5.1 billion, independent oil firm Phoenix Petroleum Philippines Inc., which is listed among the country’s top 250 corporations, is facing smuggling charges from the Bureau of Customs.
The BOC on filed the complaint with the Department of Justice (DOJ), where a panel of prosecutors will conduct a preliminary investigation to determine whether there is probable cause to file a case against the respondents before the appropriate court.
Named respondents to the complaint were Phoenix president and CEO Dennis Ang Uy, and Customs broker Jorlan Cabanes, who supposedly connived with the oil firm on its alleged smuggling activities.
Uy allegedly violated the Tariff and Customs Code by failing to pay excise and value-added taxes and submit import documents such as invoices and bills of lading for the shipments of various petroleum products from June 2010 to April 2011.
LACK OF PROCESS
Phoenix spokesman Raymond Zorilla was surprised at the charges lodged against the company.
“We were never investigated (before). We’re a legitimate company and our records are open to the public, being a publicly listed company,” he said.
He likewise said that they will be “fighting out” the matter with the BOC. “We will fight this out, we will defend our integrity,” he said.
Zorilla denied the oil firm has evaded its tax obligations.
“The company has been paying taxes religiously and its records will clearly belie these unfounded accusations against it. As a matter of fact, the company is among the top taxpayers in Davao City, where it is based,” Zorilla said.
He decried the supposed lack of due process from the Customs Bureau.
“In this case, there was no such process taken making the filing of the complaint highly unjust, arbitrary and oppressive. It unfairly damages all the hard and honest work that the company has exerted in building its name. The company does not take this accusation lightly and is currently consulting legal counsel on all possible courses of actions,” it added.
Alleged smuggling activities
In its complaint, the Bureau of Customs said that Phoenix’s nine import entries from Thailand did not match the volume and value reported by an independent surveyor tapped by the firm.
“Subsequent verifications by the RATS [Run After the Smugglers] group revealed that between June 2010 and April this year, Phoenix made several importations of various petroleum products with a combined dutiable value of P5.144 billion,” said Customs commissioner Angelito Alvarez at a news briefing.
The bureau’s investigation also showed that Phoenix brought in P459-million worth of petroleum products “without any supporting import entry declarations, effectively depriving the government of lawful duties and taxes on the said shipments.”
Likewise, Phoenix allegedly failed to submit the required importation documents covering 31 import entries from June 2010 to April 2011. The aggregate amount of the shipment was valued at P4.7 billion.
‘Fastest growing oil company’
Phoenix in 2009 ranked 211 among the country’s top firms.
According to its company website, Phoenix was incorporated in May 2002 in Davao City as a family business under the name Davao Oil Terminal Services Corporation (DOTSCO).
The company started operating in its current form in January 2004 when it distributed petroleum products to various commercial entities in Mindanao.
In August 2006, the company was officially renamed Phoenix Petroleum Philippines, Inc.
Alvarez noted that Phoenix is “perhaps the fastest growing oil company” because its 2011 first quarter revenue of P6.1 billion was 122-percent higher than the P2.75 billion it made during the same period last year
For its alleged fraudulent shipments worth P5.1 billion, independent oil firm Phoenix Petroleum Philippines Inc., which is listed among the country’s top 250 corporations, is facing smuggling charges from the Bureau of Customs.
PROBABLE CAUSE
The BOC filed the complaint with the Department of Justice (DOJ), where a panel of prosecutors will conduct a preliminary investigation to determine whether there is probable cause to file a case against the respondents before the appropriate court.
Named respondents to the complaint were Phoenix president and CEO Dennis Ang Uy, and Customs broker Jorlan Cabanes, who supposedly connived with the oil firm on its alleged smuggling activities.
Uy allegedly violated the Tariff and Customs Code by failing to pay excise and value-added taxes and submit import documents such as invoices and bills of lading for the shipments of various petroleum products from June 2010 to April 2011.
Phoenix spokesman Raymond Zorilla was surprised at the charges lodged against the company, saying they have yet to receive a copy of the complaint.
“We were never investigated (before). We’re a legitimate company and our records are open to the public, being a publicly listed company,” he said.
He likewise said that they will be “fighting out” the matter with the BOC. “We will fight this out, we will defend our integrity,” he said.
Zorilla denied the oil firm has evaded its tax obligations.
“The company has been paying taxes religiously and its records will clearly belie these unfounded accusations against it. As a matter of fact, the company is among the top taxpayers in Davao City, where it is based,” Zorilla said.
He decried the supposed lack of due process from the Customs Bureau.
“In this case, there was no such process taken making the filing of the complaint highly unjust, arbitrary and oppressive. It unfairly damages all the hard and honest work that the company has exerted in building its name. The company does not take this accusation lightly and is currently consulting legal counsel on all possible courses of actions,” it added.
SETBACKS
THE P5-billion smuggling and tax evasion case allegedly filed against Phoenix Petroleum caused its stocks to fall P2.10 per share, a day after Customs Commissioner Angelito Alvarez publicly announced the suit on May 5.
Phoenix allegedly suffered a setback at the close of trading day on May 6 when share prices went down to P12 per share compared to P14.10 on May 4.
 Phoenix president and CEO Dennis A. Uy returnED the favor.
Phoenix Petroleum Philippines, Inc filed libel charges, grave misconduct and abuse of authority against Alvarez before the Office of the Ombudsman in Mindanao.
In his affidavit, Uy claimed that Alvarez acted with malice and criminal intent when he announced to the press that the government had filed a P5-billion smuggling and tax evasion cases against the company.
However, upon verification with the Department of Justice, Phoenix found no such complaint that was filed against Uy and another personality, Davao-based customs broker Jorlan C. Cabanes, and other unidentified people contrary to claims of Alvarez.
Uy said that these showed �a clear malicious and criminal intention to malign me and the corporation imputing the commission of a crime supposedly based on the filing of charges when in truth and in fact, as of that day May 5, 2011, there was yet to be such charges officially filed,� said Uy in his affidavit-complaint.
The basis for BOC complaint
The fact sheet released the BOC quoted Alvarez as saying that the agency�s RATS group built the case against Phoenix based on the initial discovery of nine import entries inconsistent with the volume and value of Load Port Survey of the international surveyor commissioned the Bureau of Customs.
Subsequent verifications the RATS Group revealed that between June 2010 and April this year, Phoenix made several importations of various petroleum products with a combined dutiable value of P5,144,035,000.00, it said.
Among the alleged anomalies found the RATS group as stated in the fact sheet were:
-the P459 million worth of imported petroleum products the company brought in between June and December 2010 cleared customs without any supporting import entry declarations, effectively depriving the government of lawful duties and taxes due on the said shipments;
-some 4.7 billion worth of various imported products, while covered 31 import entry declarations, were taken out of the Port of Davao and the sub-port of Bauan, Batangas between June 2010 and April 2011 despite the non-submission Phoenix of the required importation documents such as  invoices and bills of lading.
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