SRA replies

The Sugar Regulatory Administration sent a letter signed by its Administrator, Ma. Regina Bautista-Martin. The letter is dated October 14 but I received it on the 23rd. It is a reaction to my series of columns on the powers that the proposed bills in the Senate and in the House of Representatives are giving to SRA.

In general the letter is a set of denials of the thesis that the bills filed by Senator Cynthia Villar and Cong. Alfredo Benitez gave additional power to SRA. Let’s respond to the letter that appears to be misgivings or fear of SRA that its additional powers might create a negative or reactionary impact on the industry.

Indeed the reputation of the powerful Philippine Sugar Commission is still fresh in the minds of the planters and any indication of its reentry or resurrection even in another form will surely cause a backlash.

But that is a perception bolstered by the absence of publication and explanation of the details of the two bills. We read only bits and pieces, the “soft” ones.

Martin claims that the proposed Sugarcane (?) Development Act of 2014 “does not grant or extend additional powers to the SRA” but rather its power is “mostly regulatory and are inherent with and are already exercised by SRA…” Why the word “Industry” after “Sugarcane” was omitted is probably just clerical error or sloppiness.

Let me raise several questions and let SRA deny that these additional powers of regulation are not included in any of the two bills. Or perhaps are we reading different versions of the bill because both the Villar and Benitez bills give powers that are not in EO 18 that created and governs SRA but are in their bills?

For instance, does EO 18 give SRA the power to classify and quedan molasses? Is not the present power of SRA limited to the classification of sugar but not its by-product? While the power to classify is inherent in the authority to regulate, does this “inherent” power without parameter or limit? Can SRA be left to decide on its own what to regulate or not?

Whatever happened to the dictum that what the law does not include is deemed excluded. Is this not the reason that the power to classify not only sugar but its other by-product is included in the bills?

Before we proceed further, let me just digress a bit on the quedan because some of our readers are asking about this. This is also for us, including me, that SRA says “lack … understanding of the dynamics of the sugar industry.” We need edification, so to speak. 

The word “quedan” is derived from the Spanish term “quedar” which means “to remain.” Prior to the introduction of the centrifugal sugar milling in 1912, all the sugar belongs to the planter because he has his own mill. He disposes his sugar at his pleasure.

When the centrifugal milling was introduced, the planter sends his cane to the mill and the sugar is stored in the mill warehouse. The mill issued an instrument called “quedan” as proof that he has sugar, the quantity of which is indicated in the quedan or warehouse receipt. The sugar owner can thus sell his sugar without physically carrying it; the quedan was sufficient for the buyer to go to the mill and withdraw the physical sugar.  

At the time there was no government intervention on the trading of sugar regardless of destination until the government ordered in 1934 its classification. I will elaborate in this when we reach the point of the SRA letter that the quedan system is not a restrain to trade.

Anyway, let me ask SRA to tell us whether the powers listed in the Benitez bill are included in its regulatory powers under EO 18. I lifted some of these powers enumerated in Sec. 3B of the Benitez bill.

“1. All sugar warehouses and storage facilities are required to register with the Sugar Regulatory Administration (SRA).” Is this power found in EO 18 even by extension of the power to regulate? If so, are warehouses and storage facilities where sugar is stored registered by SRA?  Well then, why is SRA unable to track down smuggled sugar when these are necessarily warehoused or stored even in container vans or ports and wharfs? In reality EO 18 does not list as among the powers of SRA the registration of warehouses, etc. This provision in the Benitez bill thus expands the power of SRA.

Let’s continue tomorrow.*

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