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CeMAP responds to cement cartel allegations

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CeMAP responds to cement cartel allegations

/ 05:10 AM August 10, 2017

This is in response to your Aug. 7 editorial “Cement Cartel?,” which relies and extensively cites the complaint filed by former trade undersecretary Victorio Dimagiba allegedly with the Philippine Competition Commission (PCC).

Based on the editorial, the Inquirer apparently has a copy of this complaint. This is better than the situation of the Cement Manufacturers Association of the Philippines (CeMAP), the subject of the complaint. Though it has been 11 months since filing the complaint — and despite our written letters of Jan. 26, 2017 and March 13, 2017 to the PCC — we were disappointingly never given such a copy. Consequently, we have had no opportunity to give our side throughout all this time since we did not even know what the specific charges were.

Fairness and due process call for us to now be allowed to respond to the complaint’s unfounded and false allegations identified in your editorial.

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1) Mr. Dimagiba claims that CeMAP “filed unsubstantiated and frivolous cases solely against non-CeMAP imported brands, claiming that these were substandard cement.”

Response:  Not true. A personal, not CeMAP, complaint was submitted to DTI on a local, not imported, brand. The manufacturer was subsequently found guilty and fined by DTI. Therefore, the complaint was neither CeMAP’s, nor unsubstantiated, nor frivolous.

2) Mr. Dimagiba claims CeMAP “widely circulated in the media and other forums misleading and unsupported information that current oversupply and low demand in other Asean countries risked flooding the Philippines with substandard cement.”

Response: Not true. CeMAP strongly denies this baseless allegation.

3) Mr. Dimagiba claims that local cement companies “maintained prices of domestic cement in the retail market unreasonably high, opening independent imports to suits on predatory pricing.”

Response: Not true. Prices have not been unreasonably high. In fact, price increases over the last three years have averaged at a minimal 0.8 percent, much less than the average inflation rate of 2.6 percent. This is recorded in the DTI website.

4) Mr. Dimagiba claims that CeMAP “widely circulated unverified reports inferring that independent importers of cement are technical smugglers.”

Response: Not true. The investigation on technical smuggling through freight undervaluation was announced by then Bureau of Customs (BOC) Commissioner Albert Lina in an official press conference. CeMAP and the rest of the private sector have no power to investigate or render judgments on technical smuggling. This is done by BOC using its own internal records.

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5) Mr. Dimagiba claims that CeMAP “sought to embed in the DTI the interest of CeMAP to ensure continuing protection of its principals’ interests.”

Response: Not true. CeMAP never strives to protect cement interests to the detriment of consumer welfare. This is because the main CeMAP interest is precisely to serve consumer welfare by helping ensure quality cement at an affordable price. It also exercises vigilance to guard against substandard cement, which poses a significant danger to life and property.

It should be noted that I was the sole official industry and agriculture representative in the core working committee of the House of Representatives that formulated the Philippine Competition Act. It would therefore be absurd for me to go against a law that I helped formulate.

It is also nonsensical for CeMAP to tarnish its hard-earned reputation as a model of corporate social responsibility and good governance. In 2015, CeMAP became the sole recipient of the Hall of Fame Award for Sustainable Development by the Federation of Philippine Industries, besting 33 other industry sectors over a four-year period. In 2016, it received the Industry Development Award from the Philippine Council of Associations and Association Executives, which has 161 associations.

ERNESTO M. ORDOÑEZ, president, Cement Manufacturers Association of the Philippines

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TAGS: Cemap, cement cartel, cement manufacturers, Ernesto M. Ordoñez, Inquirer letters, PCC, Philippine Comptetition, Victorio Dimagiba
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