Starting in 2019, SGS will combat illegal fuel trading in the Philippines and help prevent fiscal damage, as well as decreasing the environmental and social costs associated with the illicit activities.
Fuel smuggling is an issue for several countries around the world. This can be in the form of outright stealing, where fuel is snuck into the country by ships docking in smaller ports or by transferring fuel products on the high seas. Another smuggling practice is misdeclaration, in which the fuel is declared at a lower value (e.g. a lower fuel grade) or volume, so the importers pay less tax than they should. The Philippines is a country that suffers significantly from illegal fuel trade and the resulting unpaid taxes. In late 2018, SGS won a tender to provide the Philippines with a Fuel Integrity Program, starting in 2019, constituting an integrated array of services, coordinated and controlled by SGS experts.
The solution includes actions such as adding a marker to taxed fuels to enable traceability and monitor integrity as they move through the supply chain. SGS will also visit depots and retail sites to collect samples and check the integrity of fuel sales. Additionally, SGS will produce test reports, analyze data and provide intelligence and risk management information about illegal activity. SGS operates similar programs in several other countries, such as Serbia, Senegal, Ivory Coast and Kenya. The service is of benefit to legitimate, legal, oil marketing companies, as it helps protect their brand integrity, but it also benefits consumers, who receive the quality of fuel promised. For governments and broader society, the increase in tax revenue collection can make a significant difference.
SGS Global Manager, Fuel Integrity Programs