Smugglers’ days numbered?

During his second State of the Nation Address (Sona) last year, President Marcos identified smuggling, hoarding, and manipulation as a major cause of high agricultural commodity prices. Labeling them as “cheaters” who take advantage of farmers and consumers, he vowed that the government would chase after them and put them in jail.

Last week, he signed into law Republic Act No. 12022, or the Anti-Agricultural Economic Sabotage Act, which now classify smuggling, hoarding, profiteering, and cartel operations involving agricultural and fishery products as economic sabotage—a nonbailable offense punishable by life imprisonment and fines of up to five times the value of the goods involved.

“Let me be clear: This law does not just target the masterminds; it holds all accomplices accountable—financiers, brokers, employees, even transporters,” the President warned during its signing in Malacañang.

As in any other law, however, there are crucial issues that need to be addressed to be able to fulfill the intent of RA 12022. The most crucial is enforcement. The country’s experience in this regard has been very poor, simply look at the environmental destruction taking place across the country despite the existence of several laws against them.

Gargantuan task

The scores of undisciplined motorists disregarding even the most basic traffic regulation is another proof (for example, jeepney drivers picking up and dropping off passengers in areas clearly marked “no loading/unloading zones”).

Perhaps what will differentiate RA 12022 is that the President looks intent on leading the task. The law calls for the establishment of the Anti-Agricultural Economic Sabotage Council, which he will head, alongside other key government officials, to harmonize and coordinate efforts against smugglers and hoarders. An Anti-Agricultural Economic Sabotage Enforcement Group will also be set up to focus on dismantling smuggling and cartel operations and apprehending offenders.

Another concern is prosecution. Once cases were filed in court, these remained in the dockets for ages, delaying the serving of justice. RA 12022 mandates the formation of a special team of prosecutors that will expedite cases related to agricultural sabotage. “No longer will these cases gather dust; they will be prioritized, and they will be resolved urgently,” the President noted.

The public also has a role and cannot rely solely on the government to do this gargantuan task of ending smuggling, hoarding, and price manipulation in the agricultural sector.

Onion saga

Given the country’s porous borders, ordinary citizens can help the government intensify its watch on ports of entry for contraband goods. “This law is not just another policy; it is your battle cry,” said the President.

The onion saga clearly demonstrates the harm caused by smuggling. Lawmakers previously blamed agricultural smuggling for the high prices during the latter part of 2022. At one point, onion prices skyrocketed to about P500 to P700 a kilo from the usual P80 to P200.

According to Marikina Rep. Stella Quimbo, the hearings done by the House committee on agriculture and food showed that the onion cartel manipulated prices by creating a fake shortage of cold storage facilities needed to keep onions fresh.

In June 2023, the President himself noted that the sky-high prices of agricultural products were due to no other reason other than smuggling and hoarding. “The onions were sufficient; they were just hoarding and tightening prices. The cold storage (facilities) were not allowed to be used, so the syndicates controlled the onions that would reach the market,” he lamented.

Blatant collusion

The enforcement office of the Philippine Competition Commission (PCC), which filed early this month charges and penalties totaling P2.42 billion against 12 onion traders and importers for allegedly acting as a cartel since 2019, shows how they operate. They allocated the supply of imported onions by assigning among themselves the clearances issued by the Department of Agriculture. These importers and traders also divided among themselves the volume of onions allowed to be imported.

“So, by agreeing to allocate … among themselves the actual volume of imports, respondents effectively controlled more than 50 percent of the volume of onions imported into the Philippines,” said lawyer Christian Loren de los Santos, the director of the PCC’s enforcement office. “This agreement leads to lower supply, higher prices, poorer quality and less innovation, which harm consumers, businesses, and the economy in general.”

This blatant collusion of cartels and syndicates manipulating the onion trade is replicated in other agricultural products, including rice, sugar, and even vegetables.

It is hoped that RA 12022’s signing into law and the measures lined up to strictly enforce it will fulfill the President’s warning during his Sona that the days of agricultural smugglers are numbered. This is one promise worth keeping.