The Court of Appeals yesterday upheld the right of the Sugar Regulatory Administration to regulate the distribution of sugar in the local market by dismissing the case filed by La Filipina Uy Congco Corp. against the SRA.

In a decision signed by Associate Justice Rodrigo Cosico and concurred in by Associate Justices Danilo Pine and Arcangelita Romilla-Lontok, the court ruled that the SRA's power to regulate the withdrawal from warehouses and the distribution in the market of the imported sugar is sanctioned by Executive Order No. 18.

The appellate court pointed out that the SRA did not bar the importation of sugar but only its withdrawal from the warehouse and disposition in the market.

Issues raised in the suit delved on the power of the SRA to promulgate rules and regulations on the distribution of imported sugar into the domestic market.

The CA pointed out that the SRA is empowered to promote the effective merchandising of sugar and its by-products in the domestic and foreign markets.

It also cited Section 3 of EO 18 which vested on the SRA the power to “institute, implement and regulate an orderly system of quedanning, disposition and withdrawals of various forms of sugar from warehouses”.

“In providing for the classification of sugar as either “B” or domestic sugar or “C” or reserve sugar, it is not sugar importation that SRA is regulating but the release to the domestic or local market of imported sugar,” the CA decision stated.

It also added that such regulation is clearly intended to protect national interest, as well as the interests of local producers who may be adversely affected by the influx of foreign sugar.

The case stemmed from La Filipina Uy Gongco Corporation's importation of a total of 24,000 metric tons or 480,000 lkgs of sugar from Thailand . The imported sugar was stored in warehouses.

On May 17, 1995 , the SRA classified the imported sugar as “C” or reserve sugar. This prevented La Filipina from withdrawing the stock from the warehouse.

SRA subsequently denied the La Filipina petition to reclassify the sugar as B or domestic sugar. Then SRA chief Wilson Gamboa Sr. revoked the license of La Filipina and required the latter to pay a fine of P2,368,895. The trading firm paid the fine under protest and questioned by the authority of the SRA to promulgate rules and regulations on the distribution of imported sugar to the domestic market.*

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