Hyundai PH: VACC charges vs. company 'pure harassment'

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Metro Manila (CNN Philippines, February 15) — Hyundai Asia Resources, Inc. (HARI), the exclusive distributor of Hyundai cars in the Philippines, said the complaint filed by the Volunteers Against Crime and Corruption (VACC) against the company was "pure and simple harassment."

This came after the VACC accused HARI, Trade Secretary Ramon Lopez and 10 others of committing plunder, technical smuggling and estafa.

Read: VACC files plunder raps vs. Trade Sec. Lopez, 10 others

The group alleged that Lopez, as Board of Investments (BOI) chair, unjustly favored HARI by approving the company's application to join the motor vehicle development program (MVDP), even if the company had yet to fully comply with requirements.

The MVDP aims to enhance the country's capability to produce completely built-up units for local and foreign markets.

The program also allows companies to pay 1 percent preferential tariff rate, instead of the standard 20 percent, for the import of completely knocked-down units to be assembled in the country.

However, HARI was bringing in semi-knocked down units, which only needed to be fitted with wheels and batteries once they were in the Philippines.

The Department of Trade and Industry (DTI) estimated violations began in October 2016 and went on until the company was caught in July 2017.

Read: DTI: No favors for Hyundai

During that period, the South Korean carmaker brought in 600 units of its H350 van and 4,000 units of its popular Eon hatchback.

The DTI has since suspended Hyundai's MVDP membership until it pays back the ₱1 billion it estimates the company should have paid with the regular 20 percent tariff.

HARI President and CEO Maria Perez Agudo said in a Wednesday statement that there was nothing irregular with the BOI's decision.

"We sought reconsideration of BOI's original decision to cancel our MVDP license as matter of right and as allowed by BOI rules," she said. "Whatever the final decision of BOI was based on lawful deliberations even if we believe we are the victim, not a conspirator as VACC alleges."

Agudo added that although HARI planned to appeal the BOI's decision to the Court of Appeals, the company abided by the ruling "for practical and long term business considerations."

"As proof of good faith, HARI has been introducing additional painting and welding activities and would refund the VAT (value added tax) and duty differential being computed by BOC (Bureau of Customs), as preconditions for the lifting of its MVDP suspension," HARI said.

Unfazed by VACC's complaint, Agudo said the company and its executives are ready to answer all charges at the proper time and forum.

CNN Philippines Correspondents Claire Jiao and Anjo Alimario contributed to this report.