Sabah faces Viet rice blacklist
Published on: Sunday, March 10, 2019
By: Hayati Dzulkifli

KOTA KINABALU: Sabah may be blacklisted from future Vietnamese rice imports following an alleged rice transhipment bungle by Malaysian Customs which, according to a spokesman for seven Vietnamese firms involved, is said to have incurred them over RM10 million in losses.

Peter Doan told Daily Express, Saturday, the transhipment in 351 containers accounted for 9,000 metric tonnes of rice worth USD3 million. These were seized by Malaysian Customs at Kota Kinabalu port last October, even though meant for Southern Philippines and did not breach any Malaysian law.

He said unexpected seizure was the first that they encountered in the past 20 years.

He said the consignment, was meant for Zamboanga after calling at Kota Kinabalu (KK) Port and Labuan Port. Its vessel departed from Vietnam on Sept 8, and reached KK Port on Sept 10, 2018. “Due to port congestion in Labuan, the shipping line agent (for the seven firms) discharged the cargo in Sepanggar Port for a while but when it applied for loading to Labuan Port on Sept 24, last year, Customs here rejected the application for the transhipment and detained the cargo for the purpose of investigation.

“Based on its initial schedule, the consignment was meant for buyers in the Philippines and was supposed to reach Zamboanga between Oct 12 and 15, last year, which did not materialise because of what happened.

“We have been in rice trading with our Sabah and Labuan trading company for almost 20 years now and to our knowledge, there is no requirement for import permit for rice transhipment regulated by Customs,” he said via WhatsApp Call.

Peter said they even checked with the Federal Ministry of Agriculture (MoA) that transhipment of rice does not need Import Permit until March 31, 2019.

He claimed they showed all the necessary documents to prove the rice cargo is only for transhipment during a meeting with Customs. Yet the cargo was not released following an investigation to be carried out.

“On Jan 10, this year, we tried to sort this out with the Customs here where the representatives of the seven firms together with our Vietnam Trade officer, Pham Quoc Thinh attached with the Vietnam Embassy in Kuala Lumpur attended the meeting at the Malaysian Customs here. The Customs officials said they need us to provide the Import Permit.

“They pointed out that we discharged the containers the Sepanggar Port without customs declaration. But in fact, our cargo is for rice transhipment and therefore we only have to declare customs in Labuan Port upon arrival in Labuan.

“The most preposterous accusation by Customs was that we kept the containers in Sepanggar Port for smuggling purposes which is totally untrue because Customs rejected our application for loading at Labuan Port since Sept 24, last year,” he said, adding that cargo was seized since Oct 5, last year until now.

Representatives of the seven firms staged a protest outside the Malaysian Embassy in Ho Chi Minh city on Saturday morning to express their frustration over the matter. 

He said they hoped the Malaysian Government would look into their predicament and to instruct the Customs to release their cargo without any delay.

“If this matter prolongs with no solution by the Malaysian Government, then the Vietnam Food Association will stop all rice trading with Sabah,” he said.

Peter also said they would be filing a suit against Malaysian Customs. If Malaysian authorities do not sort out this problem, our Vietnam Food Association will announce to stop all rice trade with Sabah. 

“We may also report to our Vietnam Prime Minister and Director of World Trade Organisation (WTO),” he said.

To a question, Peter claimed that he was informed about 16 out of the 351 containers have been emptied, so far, and it is believed that the rice sacks were auctioned to a government-linked company.


Case of doubtful declaration?

The rice consignment from Vietnam seized by Malaysian Customs from 351 containers in Kota Kinabalu last year was due to doubtful declaration, according to Ministry of Agriculture (MoA) sources. They said based on the Bill of Loading, the vessel was supposed to anchor at Labuan Port but changed its shipping direction to Kota Kinabalu Port.

They said the rice was on transhipment to the Philippines via Labuan Port. However, the MV Formosa No. 9 vessel was detained at KK Port.

“The seizure and investigation is being carried out by Malaysia Customs Department (JKDM) in Sabah as well as the prosecution under Custom Act 1967 for making false declaration and other offences,” they said, without elaborating what the other offences were.

“This case was not handed over to MoA and JKDM will continue investigating the case until the prosecution level.

Furthermore, the Ministry has received a directive from the Cabinet and we (MoA) need to present a Cabinet paper end of March on the way forward for transhipment,” they said.


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