Tariff and Customs Law
exportation
Sources
1. Customs Modernization and
Tariff Act of 2016 (RA 10863)
amended PD no. 1464
2. Special laws and regulation
enforced by the Bureau of
Customs.
Example: NIRC specifically VAT
applied to imported goods, excise
taxes, Documentary Stamp taxes
imposed on documentation of
importation process, Safeguard
Measures Act (RA 8800), Anti-
Dumping act of 1999,
Countervailing Act (RA8751),
International Trade Agreement like
ASEAN agreement on the common
effective preferential Tariff Scheme,
Regulation within the authority of
the BOC like BSP circulars
Custom duty or Tariff is the name
given to taxes imposed for the
importation to and exportation from
the Philippines of goods or
commodities.
Nestle Philippines vs. CA July 6, 2001,
custom duty is the tariff or tax
assessed upon merchandise imported
from or exported to a foreign country.
Tariff can be understood in 3 senses 1)
Custom duty is a toll, tribute, etc
payable for the importation or
exportation of goods 2) Rates of
customs duties 3) List of articles/goods
subject to custom duties
Goods for purposes of custom duties is
defined Goods refer to articles, wares,
merchandise and any other items
which are subject of importation or
Case: US dollar as well as checks
being brought out the country by a
passenger can be considered as goods
because they are not use as legal in
tender in the Philippines.
When does importation begins?
Importation begins when the carrying
vessel or aircraft enters the Philippine
territory with the intention to unload
therein.
When does importation ends? It
depends.
In case the article is subject to tax,
Importation is deemed terminated
when The duties, taxes and other
charges due upon the goods have
been paid or secured to be paid at the
port of entry unless the goods are free
from duties, taxes and other charges
and legal permit for withdrawal has
been granted;
Significance- once importation begins,
the Bureau of Customs will already
have jurisdiction and Taxes, Charges
will apply.
In case the goods are deemed free of
duties, taxes and other charges, the
goods have legally left the jurisdiction
of the Bureau. (Sec. 103, RA 10863)
Note: when the goods or articles
illegally left the country, jurisdiction
will not be lost. When the BOC finds
any violation to pertinent laws and
existing regulation, the goods may be
subject to seizure or forfeiture.
General rule as to the applicability
of duties, taxes and other charges
As a general rule, all goods, when
imported into the Philippines, shall be
subject to duty upon importation,
including goods previously exported
from the Philippines Except as
otherwise provided for in this Act or in
other laws (Sec. 104)
Case: A Filipino citizen who left for
abroad wearing a diamond ring and
after 6 months came back wearing the
same diamond ring. If he fails to
declare said ring, he would be subject
to Custom duties.
As a rule, Imported goods shall be
subject to the import duty rates under
the applicable tariff heading that are
effective at the date of importation or
upon withdrawal from the warehouse
for consumption. In case of withdrawal
from free zones for introduction to the
customs territory, the duty rate at the
time of withdrawal shall be applicable
on the goods originally admitted,
whether withdrawn in its original or
advanced form (Sec. 105)
In case of goods sold at customs
public auction, the duty rates at the
date of the auction shall apply for
purposes of implementing Section
1143(a) of this Act.
Basic Rules on importation of goods:
1) all goods imported into the
Philippines shall be entered through a
customs office at a port of entry, or
may be admitted to or removed from a
free zone as defined in this Act, as the
case may be. (Sec. 400); 2) all
imported goods shall be subject to the
lodgement of a goods declaration. A
goods declaration may be for
consumption, for customs bonded
warehousing, for admission, for
conditional importation, or for customs
transit unless otherwise provided for in
this Act. 3) All importations by the
government for its own use or for the
use of its branches, instrumentalities,
agencies, corporation owed by it
including GOCC shall be subject to
duties, taxes, fees and other charges
except those provided for under Sec.
800 (Conditionally Tax and/or Duty-
Exempt Importation) 4) Goods
admitted to a free zone shall not be
subject to duties or taxes unless
otherwise provided by law governing
the free zone or rules and regulations
established in the free zone.
Note: all importation whether subject
to duties, taxes and other charges
should be entered into customs office
in the port of entry otherwise the
goods imported will be considered
smuggled into the Philippines
What are considered as port of
entries? Port of Entry refers to a
domestic port open to both domestic
and international trade, including
principal ports of entry and subports of
entry.
A principal port of entry is the chief
port of entry of the Customs District
wherein it is situated and is the
permanent station of the District
Collector of such port.
Subports of entry are under the
administrative jurisdiction of the
District Collector of the principal port
of entry of the Customs District. Port
of entry as used in this Act shall
include airport of entry
Note: RA 10863 designated the
Principal ports of entry. The rationale
behind rule on the passing of goods
thru a PPE is to safeguard customs
revenue.
Customs Territory refers to areas in
the Philippines where customs and
tariff laws may be enforced
Free Zone refers to special economic
zones registered with the Philippine
Economic Zone Authority (PEZA) under
Republic Act No. 7916, as amended,
duly chartered or legislated special
economic zones and freeports such as
Clark Freeport Zone, etc and such
other freeports as established or may
be created by law.
Different types of importation or
exporation
Different Types of goods that can be
exported from or imported to the
Philippines: 1) Goods of Free
importation or exportation under (Sec.
116) 2) Goods of prohibited
importation or exportation (Sec. 118)
3) Goods of Regulated exportation or
exportation (Sec. 117) 4) Relief
Consignment (Sec. 120)
Different Types of importation: 1)
Prohibited importation 2) Restricted
importation 3) Conditionally taxed
and/or duty free importation 4)
Dutiable Importations 5) Duty free
importation
Sec. 116, as a general Rule, all goods
may be freely may be freely imported
into and exported from the Philippines
without need for import and export
permits, clearances or licenses unless
otherwise provided by law or
regulation. Free importation/
exportation are goods or commodities
where the importation or importation
of which is neither regulated nor
prohibited. There is no need for prior
approval or clearance from any
government agency for said goods to
be imported to or exported from the
Philippines.
Two kinds of prohibited goods under
the old law which are enumerated in
one list: 1) Goods that are absolutely
prohibited 2) Goods qualifiedly
prohibited or restricted under the new
law; the two types of prohibited goods
are mentioned separately.
Under Sec. 118, the importation and
exportation of the goods enumerated
under this section cannot be done
under circumstances (Prohibited
importation or exportation) before
they are referred to as contrabands.
Goods that are of Restricted
Importations are generally prohibited
but with proper permit/ licenses/
approval by the appropriate
governmental agency, said goods can
be imported.
Examples of Prohibited importation
and exportation: 1) Written or printed
goods in any form containing any
matter advocating or inciting treason,
rebellion, insurrection, sedition against
the government of the Philippines, or
forcible resistance to any law of the
Philippines, or written or printed goods a general Rule, can be done in the
containing any threat to take the life Philippines when authorized by law
of, or inflict bodily harm upon any and regulation. Example: 1) Dynamite,
person in the Philippines 2) Goods, gunpowder, ammunitions and other
instruments, drugs and substances explosives, firearms and weapons of
designed, intended or adapted for war, or parts thereof 2) gambling
producing unlawful abortion, or any paraphernalia 3) Lottery and
printed matter which advertises, sweepstakes tickets, except
describes or gives direct or indirect advertisements thereof and lists of
information where, how or by whom drawings therein 4) Marijuana, opium,
unlawful abortion is committed 3) Any poppies, coca leaves, heroin or other
goods manufactured in whole or in narcotics or synthetic drugs which are
part of gold, silver or other precious or may hereafter be declared habit
metals or alloys and the stamp, brand forming by the President of the
or mark does not Indicate the actual Philippines, or any compound,
fineness of quality of the metals or manufactured salt, derivative, or
alloys 4) Any adulterated or preparation thereof, except when
misbranded food or goods for human imported by the government of the
consumption or any adulterated or Philippines or any person duly
misbranded drug in violation of authorized by the Dangerous Drugs
relevant laws and regulations 5) Board, for medicinal purposes (before
Written or printed goods, negatives or they are enumerated as prohibited) 5)
cinematographic films, photographs, Opium pipes or parts thereof, of
engravings, lithographs, objects, whatever material 6) Any other goods
paintings, drawings or other whose importation and exportation are
representation of an obscene or restricted ( catch all provision)
immoral character 6) Infringing goods
as defined under the Intellectual Duty-free importation (Sec. 121)
Property Code and related laws 7) All Examples:
other goods or parts thereof which
importation and exportation are
explicitly prohibited by law or rules a) Sec. 120 Relief Consignment,
and regulations issued by the Goods such as food, medicine,
competent authority (Catch all equipment and materials for shelter,
provisions) Penalty: Seizure and donated or leased to government
forfeiture of good abovementioned but
institutions and accredited private
also other goods which in the opinion
of the district collector have been used entities for free distribution to or use
are or to be used as instrument to of victims of calamities shall be
import said article under 1113F and treated and entered as relief
thereafter to be destroyed.
consignment.
Goods of restricted
importation/exportation (Sec 119), as
Requisites of Relief Consignment: 1)
imported during state of Calamity 2)
intended for specific area affected by
calamity 3) for the use of the calamity
victims in sad area.
b) Importation of De Minimis Value
(Sec. 423), if the FOB or FCA value
does not exceed 10k, no duties and
taxes shall be collected on goods
c) Goods admitted in Free Zones (Sec.
815) - goods admitted into a free zone
shall not be subject to duty and tax
unless otherwise provided under the
respective laws, rules and regulations
of the free zone
d) Sec 820 of the CMTA
Stores which are carried in a
vessel/aircraft or train arriving in the
customs territory and remaining in the
vessel/aircraft/train or in other words
they remain on board thereon would
be exempt from duty, charges and
taxes.
What are stores? These are Items for
1) consumption of the passengers and
the crew in the course of the travel. 2)
These can also refer to articles or
equipments for the use of the
vessel/aircraft for its operation
Once said goods are unloaded, they
are not anymore duty-free because it
would be commencement of
importation. Examples: anchor
3) Replenishment of the stores. A
train/vessel/aircraft may requisition
goods to be used as stores.
Conditionally free importation (Sec.
800), will be exempt from duties and
taxes if the conditions provided by law
are complied.
If said goods are used/ bartered/ sold
other than the purpose to which they
are imported, they loss their
exemption. Exceptions: 1) sale of the
imported pursuant to a judicial order.
2) Sale in liquidation of the estate of a
deceased person
Examples of conditionally free
importations: a) Aquatic products such
as fishes, crustaceans, mollusks,
marine animals caught or gathered of
fishing vessels of Philippine registry;
Provided, That they are imported in
such vessels or in crafts attached
thereto; Provided, However, That they
have not been landed in any foreign
territory or, if so landed, that they
have been landed solely for
transshipment without having been
advanced in condition; Note: salting a
fish for preservation does not make it
advanced in condition.
A fishing vessel of Philippine registry
caught fish in Taiwan and dried and
salted therein. Thereafter, the fishes
were brought to the Philippines. Said
fish will be exempt from duties and
taxes as long as the fish must have
brought by the same vessel which
caught them from the sea at least
carrying the fishes in a watercraft
attached to the said vessel. But if the
fishes were landed in Taiwan and they
were canned there. It would now be
subject to duties because they are
already in advanced condition.
b) Equipment for use in the salvage of
vessels or aircrafts. The conditions
that must be complied so that it would
be exempt from duties: 1) they are not
available in the Philippines 2) the
importer must put up a bond in an
amount equal to 100% of the
supposed duties, taxes and other
charges due on the equipment. The
bond is conditioned that after the use
of the Equipment for use in the
salvage of vessels or aircrafts, it must
be exported from the Philippines or if
not exported, the bond is also
conditioned on the payment of DTC
due on the equipment and the bond
will be effective for a period of 6
months from the date of acceptance of
goods declaration 3) the equipment
must be duly identified. Otherwise, the
equipment will be subject to DTC.
Note: The Bureau may extend the time
for exportation or payment of duties,
taxes and other charges for a term not
exceeding six (6) months from the
expiration of the original period
c) A vessel of Philippine registry has to
undergo repairs in a foreign country.
The item that would be considered
conditionally free from duties and
taxes is the cost of the repairs.
Conditions to be complied to be duty
free: 1) the repair must have been
done in a foreign country 2) it must be
repair of vessels or aircrafts registered
or licensed in the Philippines 3) proof
satisfactory to the bureau of customs
that there is no adequate for such
repairs in the Philippines or the vessel
or aircraft is compelled to land to a
foreign country due to stress of the
weather and other casualties to secure
the sea or air worthiness of the aircraft
to reach its destination.
d) Goods brought into the Philippines
for repair, processing or reconditioning
to be reexported upon completion of
the repair, processing or
reconditioning.
Conditions to be complied for the
goods to be exempt: 1) the Bureau
shall require security equal to one
hundred percent (100%) of the duties,
taxes and other charges thereon or if
not exported within 6 months the
importer must pay the corresponding
DTC of the goods brought in the
Philippines.
e) Medals, badges, cups, and other
small goods bestowed as trophies or
prizes, or those received or accepted
as honorary distinction. Condition: 1) it
must be given to importer as trophy,
prize or must be received or accepted
as honorary distinction.
f) Two classes of Personal and
Household effects: 1) Personal and
Household effects which were
exported from the Philippines (Effects
brought out by a citizen and brought
back to the Philippines) 2) Personal
and Household effects purchased by a
Filipino Citizen from abroad and being
brought back to the Philippines.
First Class: Conditions to be
complied with: 1) the Personal and
Household effects belong to a resident
of the Philippines returning from
abroad. 2) They must be formally
declared and listed before departure
from the Philippines 3) he must
identify the goods under oath before
the district collector of customs at
least before leaving the Philippines or
while abroad 4) the following are
considered as personal and household
effects; household appliances, jewelry,
precious stoned and other goods of
luxury 5) not in commercial quantity
6) not intended for barter, sale or like
7) the FOB or FCA value must not be
more than P350,000 if the returning
resident stayed abroad for at least 10
years and he must have availed of this
privilege only once within 10 years or
if the returning citizen stayed abroad
for less than 10 years but at least 5
years, the value of the Personal and
Household effects that could be
imported free from duty is 250,000. If
the stay abroad is less than 5 years,
the Personal and Household effects
that could be imported free from duty
is only 150,000. Note: the excess is
subject to duties and taxes
Note: Overlapping of period under RA
10863
Who are considered as returning
residents? These are Filipino citizens
who stayed abroad for at least 6
months abroad.
Suppose the effects were advanced or
improved when the returning citizen is
abroad. Only the increment of the
value would be subject to duties and
taxes.
Second Class: conditions to be
complied 1) they must be necessary,
appropriate for the use or comfort and
convenience of the returning resident
during stay abroad; 2) the personal
and household effects must
accompany them in their return in the
Philippines or must arrive in the
Philippines within reasonable time
which, barring unforeseen and
fortuitous events, in no case shall
exceed sixty (60) days after the
owner's return 3) it must consist of
wearing apparel, goods of personal
adornment, toilet goods, instruments
related to one's profession and
analogous personal or household
effects, excluding luxury items,
vehicles, watercrafts, aircrafts and
animals purchased in foreign countries
4) not in commercial quantity 5) not
intended for barter, sale or like 6) the
FOB or FCA value must not be more
than P350,000 if the returning resident
stayed abroad for at least 10 years
and he must have availed of this
privilege only once within 10 years or
if the returning citizen stayed abroad
for less than 10 years but at least 5
years, the value of the Personal and
Household effects that could be
imported free from duty is 250,000. If
the stay abroad is less than 5 years,
the Personal and Household effects
that could be imported free from duty
is only 150,000. Note: the excess is
subject to duties and taxes 8) the
returning resident must be a Filipino
national who must have stayed in a
foreign country for at least 6 months.
7) Excess shall be dutiable
BAR 2003: X and His Y wife, Filipino
residents, went to a 3 months pleasure
trip to a foreign country. In the course
of their trip, they accumulated some
personal effects which are necessary,
appropriate and normally use in
leisure trip as well as souvenirs and
not in commercial quantity. Are they
returning citizens for the purpose of
tariff and customs code? No, because
they only stayed abroad 3 months less
than what is required by law which is 6
months.
Note: in case of OFWs, they shall have
the privilege to bring in, tax and duty-
free, home appliances and other
durables (similar to Personal and
household effects), limited to one of
every kind once in a given calendar
year accompanying them on their
return, or arriving within a reasonable
time which, barring unforeseen and
fortuitous events, in no case shall
exceed sixty (60) days after every
returning OFW's return upon
presentation of their original passport
at the port of entry. Excess in the no.
shall be dutiable.
g) In the case of Residents of the
Philippines, OFWs or other Filipinos
while residing abroad or upon their
return to the Philippines, they shall be
allowed to bring in or send to their
families or relatives in the Philippines
balikbayan boxes which shall be
exempt from applicable duties and
taxes imposed under the NIRC of
1997, as amended
Conditions: 1) balikbayan boxes shall
contain personal and household
effects only 2) not in commercial
quantity 3) not intended for barter,
sale or for hire 4) the FCA value of
which shall not exceed one hundred
fifty thousand pesos (150,000.00) 5)
can only be availed of only up to 3
times in a calendar year. Excess in the
FCA shall be dutiable.
Bar: X a balikbayan has a used car
among the items he brought to the
Philippines where he will resettle for
30 years after living to California for
30 years. He also brought with him a
VCD machine and a stereo. Will the
imported articles of X be subject to
duties? The used car cannot qualify as
Personal and household effect, hence,
subject to duties.
l) A) Importations for the official use of
foreign embassies, legations and other
agencies of foreign government
provided that those foreign countries
accord like privileges to corresponding
agencies of the Philippines. B) Goods
imported for the personal or family
use of members and attaches of
foreign embassies, legations, consular
officers and other representatives of
foreign governments provided That
such privilege shall be accorded under
special agreements between the
Philippines and the countries which
they represent
m) importation of donated articles:
conditions: 1) Imported goods donated
to or, for the account of the Philippine
government or any duly registered
relief organization not operated for
profit 2) the deed of donation must be
duly authenticated 3) the done must
execute a deed of acceptance 4) proof
that the done is duly registered with
the SEC or relief organization
registered with the DSWD 5) the
importation is for free distribution
among the needy and upon
certification by the DSWD or the
Department of Education (DepED), or
the Department of Health (DOH), as
the case may be
BAR: An imported ambulance was
donated to a registered relief
organization. Would it be dutiable?
Yes, because the ambulance cannot be
distributed for the needy.
p) 1) Importation of goods or salvage
from a vessel abandoned or wrecked
outside the territorial jurisdiction of
the Philippines 2)parts or equipment of
a foreign vessel abandoned or
wrecked inside or outside the
territorial jurisdiction of the
Philippines.
Note: bringing of parts or equipment
of foreign vessel even if found outside
the Philippines is called importation
because the said articles are found
from a vessel of foreign registry.
Condition: said articles must be
imported after two years from the date
of the filing of the marine protest by
the captain of the vessel or if no
protest has been fled, it must be
imported after two years after the
abandonment or wreckage otherwise,
said articles would be subject to DTC.
Note: No part of a Philippine vessel or
aircraft or its equipment, wrecked
either in Philippine or foreign waters,
shall be subject to duty (Sec. 418, Last
paragraph).
q) Importation of coffins or urns.
Conditions: 1) they must contain
human remains, bones or ashes, used
personal and household effects (not
merchandise) of the deceased person,
except vehicles 2) the FCA value of
which does not exceed one hundred
fifty thousand pesos (150,000.00)
s) Importation of animals except race
horses and plants intended for
scientific, experimental propagation or
breeding, and for other botanical,
zoological and national defense
purposes
What goods or articles cannot be
imported without authority from the
government and duly authorized
institution? Live trees, shoots, plants,
moss and bulbs, tubers and seeds for
propagation purposes
Note: for animals imported for
breeding purpose, the following
conditions must be complied: 1) must
be restricted animals of recognized
breed 2) the breed of the animal in the
record or registry established for the
breed. The breed of the animal must
be certified by the Bureau of Animal
Industry
u) Situations: 1) in the case of locally
manufactured goods previously
exported for some purpose and
returned to the Philippines thereafter
provided they did not incur
advancement or improvement and
that no drawback or bounty has been
allowed to the article; 2) foreign goods
previously imported into the
Philippines (which were already
subject to DTC) were exported to a
foreign country then re-imported back
to the Philippines. However, their
exportation must be for exhibition,
testing and experimentation, for
scientific or educational purposes 3)
foreign containers previously imported
into the Philippines and exported back
used as packaging for goods exported
from the Philippines and after being
empty returned back to the Philippines
as importation provided they are not
for sale and duly identified (The same
article imported)
x) Importation of spare parts for vessel
or aircrafts of foreign registry engage
in foreign trade. The spare parts must
have been brought to the Philippines
exclusively for replacement or for
emergency repair of the foreign vessel
or aircraft. There must be proof to the
district collector that said spare parts
will be used to secure the safety,
seaworthiness or airworthiness of the
vessel or aircraft, to enable it to
continue its voyage or flight
aa) Importation of personal and
household effects including one motor
car imported by: 1) officer or
employee of the DFA 2) military or civil
attach 3) members of the staff
assigned to a Philippine Diplomatic
mission abroad 4) similar officer or
employee assigned to other
departments assigned to any
Philippine consular office abroad 5)
AFP military personnel accorded
assimilated diplomatic rank or on duty
Provided they are returning from a
regular assignment abroad 2)
returning for reassignment 3)
returning because said person had
already died, he resigned or he retires.
Conditions: 1) importation of Personal
and household effects including one
motor car 2) personal and household
effects must have purchased or
ordered abroad by said persons prior
to receipt by the mission or consulate
of the order of recall 3) it must
registered in his own name 4) the
exemption shall apply only to the
value of the motor car and to the
aggregate assessed value of the
personal and household effects should
not exceed thirty percent (30%) of the
total amount of salary and allowances
received by the officer and not
exceeding four (4) years during
assignment abroad. 5) this privilege
can only availed once every four years
6) the officer or employee must have
served abroad for at least 2 years.
Dutiable Importation- these are
importations which are subject to
duties, taxes, fees and other charges.
2 kinds of customs duties: 1) Regular
Customs duties 2) Special Customs
Duties.
Regular Customs Duties- if the
customs duties is imposed to raise
revenue for the government or
imposed as a tariff barrier (these are
protective tariff which may be
imposed to imported articles in order
to prevent the entry into the country
of goods that will compete
prejudicially the local manufacturers
or local products). They may also be
imposed to exports to discourage the
importation of certain raw materials so
that they may be manufactured
locally.
Different kinds of regular customs
duties: 1) Ad valorem customs duties
2) special or specific customs duties 3)
the mixed or compound customs
duties 4) alternative customs duties
Ad valorem customs duties- duties are
considered ad valorem if they are
computed on the basis of the value of
imported or exported goods. The rates
of the duties are applied to the value
Specific customs duties- the amount of
the duty or the rate of the duty is
applied to the goods based on a unit
measure. Example: per gram, per
piece, per litter or per lineal meter.
Compound customs duties if it is
both ad valorem and specific.
Example: when the customs duties is
10% of the value + 100php per
kilogram.
Alternative customs duties- if the
customs duties are either based on
the value or on per unit of measure
whichever results to higher amount of
duty. (No longer applicable today)
Special Customs duties- are duties
imposed in addition to the regular
customs duties under certain
conditions or circumstances. The
purpose of the imposition is to protect
local
consumers/manufacturers/Philippine
products from undue competition from
foreign made product/domestic
industries/ domestic producers.
Different kinds of Special customs
duties imposed under special laws
and the customs modernization and
tariff act: 1) Anti-dumping duty (RA
8752) - Sec. 711 of RA 10863 2)
Counter-veiling duty Sec. 713 3)
Marking duty Sec 710 4)
discriminatory duty- sec. 714 5)
safeguard duty- safe guard measure
act (RA 8800) Sec 712.
Specific Customs duties if the
custom duties is imposed on the basis
of weight (Net weight or Legal or Gross
weight) of the imported article.
Gross weight - it means the weight of
the imported goods itself and the
weight of all the packages, containers,
holders and packing.
Legal Weight it means the weight of
the article itself plus the weight of the
immediate container, holder or
packing in which the article is usually
contained, held or packed.
Net weight it means the actual
weight of the imported article
excluding the weight of the containers,
etc.
Example: Importation of sardines
Gross weight of sardines- sardines +
sauce + tin can + cartoons + wooden
packages
Legal weight of sardines sardines +
sauce + tin can
Net weight sardines + sauce
Gross weight = Legal weight =
importation of rice, fertilizers
Gross weight = legal weight = net
weight = importation of coal, crude oil
or wheat because they are imported in
bulk.
Cinematographic films are subject to
duties based on lineal meters.
Basic rules on importation of
articles: 1) that all goods imported to
the Philippines shall be entered thru a
customs office at the port of entry
except under Sections 417 and 800L.
2) sec. 201 all imported goods shall
be subject to lodgement of goods
declaration unless otherwise provided
by RA 10863.
Lodgement refers to the registration of
a goods declaration with the Bureau
(Sec. 102dd).
Goods Declaration refers to
statement made in the manner
prescribed by the Bureau and other
appropriate agencies, by which the
persons concerned indicate the
procedure to be observed in the
application for the entry or admission
of imported goods and the particulars
of which the customs administration
shall require (Sec. 102y).
2 kinds of entries: 1) import entry for
imported goods. 2) Entry for vessels or
aircrafts engaged in foreign trade
(whenever they land in port of entry in
the Philippines, they must also make
an entry)
Different kinds of goods declaration: 1)
Goods declaration for consumption 2)
for customs bonded warehousing for
admission to the economic zones 3)
goods declaration for conditional
importation 4) goods declaration for
customs transit
Requirements of lodgement for the
importation which is made for goods
declaration for consumption: 1) the
importation should be cleared thru a
formal entry process except in the
following importation which can be
cleared thru an informal entry process;
a) Goods of a commercial nature with
Free on Board (FOB) or Free Carrier At
(FCA) value of less than fifty thousand
pesos (50,000.00); b) Personal and
household effects or goods, not in
commercial quantity, imported in a
passengers baggage or mail.
Additional requirement if imported
goods is entered thru formal entry
process: the importation must be
covered by a letter of credit or any
a verifiable commercial document
evidencing payment (Commercial
invoice issued by exporter) or in cases
where there is no sale for export, by
any commercial document indicating
commercial value of the imported
goods.
Provisional (Incomplete) Goods
Declaration may be allowed 1)
when the declarant does not have all
the information or supporting
documents required to complete the
goods declaration, the lodging of a
provisional goods declaration 2) it
substantially contains the necessary
information required by the Bureau
and 3) the declarant undertakes to
complete the information or submit
the supporting documents within forty-
five (45) days from the filing of the
provisional goods declaration, which
period may be extended by the
Bureau for another forty-five (45) days
for valid reasons (the treatment is as if
the declaration is complete)
Question: Suppose the imported goods
were merely covered by Provisional
(Incomplete) Goods Declaration, can
the goods be released from customs
custody? Yes, upon posting of any
required security equivalent to the
amount ascertained to be the
applicable duties and taxes (Sec. 403,
3rd paragraph). But is required that the
importer must complete the
declaration.
The lodgement of the goods
declaration must be made within 15
days counted from the date of
discharge of the last package of the
importation from the carrier, vessel or
aircraft which carried the goods into
the Philippines. But if the goods are to
be transshipped, the lodgement of the
goods declaration must also be made
within 15 days from the date of
discharge of the last package from the
carrier at the final destination of the
importation. It can be extended upon
request.
The lodgement should be by electronic
means and at any designated customs
office (Sections 407 and 408).
May the lodgement of the good
declaration be made prior to the
arrival of the goods in the Philippines?
Yes as provided for under Sec. 409.
Can there be formal or informal entry
of imported goods before lodgement
of goods declaration? No as provided
for under section 412.
Split entry of imported goods an
entry made simultaneously in part for
consumption and in part for
warehousing. However, the goods
imported goods are only covered with
one bill of lading or airway bill.
Note: Split entry is allowed here in the
Philippines
Q: what is split entry? Goods covered
by one bill of Lading or airway bill over
goods which are meant in part as
consumption and in part for
warehousing may be both entered
simultaneously for release at the port
of entry.
Making of and Import Entry
1. Document filed with the BOC
2. Submission and acceptance of
documents related to an
importation
3. Procedure of passing goods
through customs house
Q: what is the operative act? It is
the filing of the specified
documents or entry form and other
documents required by law or
regulation
Q: what is Import entry internal
revenue declaration (IEIRD)?
Note: import entry is different from
IEIRD. Note also that import entry
serves as basis for payment of
advanced duties
Q: How to declare postal items?
A: by filing a special declaration
form plus other supporting
documents
Instances which should be declared
in the regular good declaration
(Separate Declaration) Sec. 438
a. If the goods whose value fall
within the level that the
commissioner has determined
to be taxable and thus must be
covered by a goods declaration;
b. Prohibited and regulated goods
c. Goods, the exportation of which
must be certified
d. Imported goods under a
customs procedure other than
for consumption
Examination of Imported Goods
GR: Physical examination
 Note: conditions for examination
under Sec. 420.
XPN: the Bureau may adopt
nonintrusive examination of goods
such as the use of x-ray machines
(per parcel of per container)
Physical examination of the goods
shall be conducted when:
a. If it is directed by the
commissioner or on account of
a If computed value
b. The goods are subject to an
alert order issued by competent
authority
c. The goods are electronically
selected for physical
examination;
d. There are issues
controversies surrounding the
goods declaration and import
clearance process; or
e. Importer or declarant request
for the examination of the
goods.
How should the value of the goods be
determined is subject to ad valorem
6 methods
a. Transaction value system
b. Transaction value of identical
goods
c. Transaction value of similar
goods
d. Deductive value
e. Computed value
f. Fall-back value
Q: what method shall be used if the
goods are subject to ad valorem?
A: primarily, it is the transaction value
system under Sec. 701.
Note: If the transaction value system
is not applicable, Transaction value of
identical goods shall be applied
Note: these methods shall be used or
applied sequentially, if prior method is
not applicable
However, importer may request that if
transaction value cannot be
determined, computed value may be
applied first before deductive value.
cannot be applied,
then it is still the deductive value. If
the first value methods are all
inapplicable, apply the fall-back value
Q: what would be the standard to be
used of the examiner; how should the
or custom authority make the
classification?
A: Sec. 104 of P.D. no. 1464
Note: in such a case, the maximum
rate to be applied shall not exceed
100% ad valorem.
Assessment
Sec. 424: duty of customs officer
tasked to assess imported goods
a. Classify
b. Value
c. Determine the duties and taxes
to be paid
d. Prepare and submit assessment
report to the director
2 kinds of assessment (Sec. 425)
1. Tentative assessment
2. Final assessment
Tentative assessment- if the duties
and taxes initially assessed are
disputed by the importer
Completed
Upon the re-adjustment base or
the tariff ruling in case of
classification dispute, or
The final resolution of the
protest case involving valuation,
rules of origin and other custom
issues
Q: may it be refused to the importer
even if there is only / merely tentative
assessment?
A: Yes, but the importer must post
sufficient security to cover the
applicable duties and taxes equivalent
to the amount that is disputed
Tentative Assessment may be made as
provisional goods declaration.
However such assessment shall be
completed upon final readjustment or
reclassification or submission by the
declarant of the additional information
or documentation required to be
complete the declaration with the
period provided in Sec. 403 of this act
(Sec. 426)
Q: if such appraisal, classification or
return as finally passed upon,
approved or modified by the district
collector, can it be altered or modified
in any manner?
A: as a general it cannot be anymore
modified or altered (Sec. 427)
XPNS:
1. Upon statement of error; this must
be made within 1 year after the
payment of duties
2. Upon request for reappraisal or
reclassification addressed to the
commissioner by the district collector,
if the is .. to be.
- must be made within 15 days after
such payment
3. Upon request for reappraisal and/or
reclassification in the form of a final
protest addressed to the district
collector by the interested party if the
latter should be dissatisfied with the
appraisal or return
4. upon demand of the commissioner
upon completion of compliance audit
Q: May an importation be assessed for
a value less than the entered value?
A: as a general rule, duties, taxes, fees
and charges of imported goods must
be assessed not less than the entered
value because entered value is the
value declared by the importer.
XPNS: Instances where assessed value
is less than the entered value
1. Upon direction of the
commissioner in cases where
the importer certifies a t the
time of entry that the entered
value is higher than the dutiable
value and that the goods are so
entered in order to meet
increased made by the
appraiser in similar cases then
pending re-appraisement
2. When the importers contention
was sustained by a final
 decision and shall appear that
such action of the importer was
taken in good faith after due
diligence and inquiry
Sec. 429: Final Assessment:
Q: when does assessment becomes
final?
A: 15 days after notice of assessment
to importer or consignee
Q: when does assessment becomes
conclusive to all parties?
A: Sec. 430, 3 years from the date of
final payment of duties and taxes or
upon completion of the post clearance
audit
XPN: when there is fraud
Liquidation:
It is composed of:
a. Final computation and
assessment of duties, taxes,
fees and charges due on the
imported article
Note: it is the district collector who
determine the final computation
Basis for determination: official
reports of the customs officer who
made the classification and
assessment
b. Payment of duties, taxes, fees
and other charges on the
imported article
2 kinds of liquidation (Sections 425-
426)
a. Tentative liquidation if future
action is still necessary to
determine correct amount of
DTFC
Example: if there is a need for
classifying, re-computation or re-
appraisal of DTFC
-it is subject to final adjustment and
settlement within 6 months.
b. Final liquidation
- if all the requisites as to procedure
covering the entry up to the
assessment of DTFC have been
accomplished and approved by the
district collector of customs and when
there is payment made.
-imported goods are cleared from
customs duties (if exempt)
Anti-dumping duty (Regulatory tax)
Nature: it is a special duty because the
imposition of which is not just limited
to raising revenue but also for
regulatory purposes (taxation as an
implement of police power). Note that
it is imposed in addition to regular
customs duties.
Note: discretionary on the part of the
tariff commission
Q: who will make the imposition of the
A.D.D.?
A: if the imported article is not
agricultural product, the sec. of DTI
who will impose of the A.D.D. upon
recommendation of the Tariff
commission. However, if it is an
agricultural product, it is the sec.
agricultural that will impose upon the
recommendation of the tariff
commission.
What should be the amount to be
imposed? An amount equal to the
margin of dumping (difference of the
normal value of the goods in the
ordinary course of trade in the country
of origin and the value as imported in
the Philippines)
The TC may consider the imposition of
the A.D.D. on the welfare of consumer,
the general public and other local
industries. The TC may find the
imposition of the ADD would be
adverse to the consuming
public/general public/ related local
industries, in such a case he may
recommend not to impose.
Q: may the anti-dumping duty be
imposed less than the margin of
dumping?
A: Yes, if it is adequate to remove the
injury suffered (Tariff code of 1978)
Q: for how long may the ADD be
imposed? As long as and to the extent
necessary to counteract the dumping
but as a general the imposition of the
ADD should not exceed the period of 5
years counted from the imposition
subject to the review of the TC and
when there is recurring injury, it may
be extended.
Q: what is the remedy of the importer?
RA 8752- the importer may file a
petition for review with the CTA with in
a period of 30 days from the date of
receipt of notice of the imposition of
ADD.
Q: upon timely filing of the petition for
review, will it stay the imposition and
collection? No, it is not suspended.
However, if there is already an
appealed case with the CTA, it may
issue an injunction for the collection of
ADD.
Countervailing duty
Note: the customs modernization and
tariff act does not provide for the
imposition of ADD and CD. However, it
adopts the provision of the RA 8751
which provides the imposition of the
said duties.
Countervailing is present if a product/
commodity/ article of commerce is
granted directly or indirectly by the
government of the country of origin or
export of any kind or form of subsidy
upon production, manufacture or
exportation of the product and the
importation of said products has
caused or threatened to cause
material injury to a domestic
industries or has materially retarded
the growth or prevents the
establishment of domestic industries
as determined by the TC.
Q: Who shall impose the
Countervailing duty? Same as with
ADD
Rationale for the imposition: Due to
the subsidy, the importer or
manufacturer will incur lesser cost in
the manufacturing and with that they
can export the product at a lesser cost
as compared to similar products
locally produce. Subsequent
importation of similar products, CA will
also be imposed. It is imposed to in
addition to regular customs duties
Q: How much is the amount to be
imposed?
A: equal to the amount of subsidy
Remedy of the importer: same as with
the ADD
Q: For how long shall the CA be
imposed?
A: for as long as and to the extent
necessary to counteract the
subsidization which is causing or
threatening to cause material injury.
The TC may make a review for the
need of continued imposition of CV
upon its own initiative or upon the
direction of the Sec. of DTI or
agriculture or an interested party may
file a petition with the Sec. of DTI and
Agriculture for the review of the
imposition. After finding that the
imposition is no longer necessary, the
TC may recommend to the Secretaries
the discontinuation of the imposition
of the CV.
Marking duty
Nature: same with ADD and CV
Sec 710- requires the proper marking
of goods and their container if
imported in the Philippines. If not
proper the MD will apply.
Q: How to mark?
A: goods of foreign origin or at least
their containers should be
conspicuously marked as legibly and
indelibly and permanently as the
nature of the goods or container allow
in such a manner that it will indicate
to the ultimate purchaser the name of
the country of origin of the goods.
Q: in what languages?
A: in any of the official languages in
the Philippines. It may be Filipino,
English or Spanish.
Purpose: to protect local consumers
from being mislead of the country of
origin of the imported goods
Note: it is also in addition to the
regular customs duties.
Non compliance warrants automatic
application from the moment
importation is commenced.
Q: what are the legal effects if the
goods imported in the Philippines is
improperly marked?
A:
1. it will be subject to marking
duty at the rate of 5% of the
dutiable value and it accrues
from the moment importation is
commenced
2. The importer or the owner will
have to be notified of the
Bureau of customs that he
should properly mark the
imported goods within 30 days
from notice.
3. The imported goods cannot be
released from customs custody
unless the req. under Sec. 710
is complied and the MD is paid.
Q: suppose the owner or the importer
of the imported goods fails to mark
the imported goods, what would be
the legal effect?
A: the imported goods will be
considered abandoned by the importer
and it will be subject to the disposition
of the BOC as in the case of
abandoned importation. It may be sold
if fit for human consumption otherwise
it will be destroyed
Exceptions to the rule of proper
marking:
1. Goods of incapable of being
marked. e.g. nails, needles
although the container may be
marked
2. Goods which are already known
to the local customers as to
their origin. e.g. articles
produced from china
3. Articles which have been
produced for more than 20
years
Q: what is the remedy of the importer
against the imposition of marking
duty?
A: to re-export the article or
destruction of the imported goods in
the presence of the officers of the BOC
and it must be done prior to the
liquidation of DTFC
Q: suppose the importer is able to
mark properly his imported article
within 30 days from notice of BOC, will
the importer still be held liable for MD?
A: Yes, because the marking duties
accrues from the importation
commence
Q: who imposes the marking duty?
A: the commissioner of customs
Retaliatory duties
Nature: it is imposed in retaliation for
discrimination being committed by
another country (Sec. 714)
Q: when is this duty is impose?
A:
1. If an article imported in the
Philippines being subjected
directly or indirectly to
unreasonable charge, exaction,
regulation or limitation being
imposed on goods coming from
the Philippines to another
country which is not equally
enforced against like articles in
another country (Discriminatory
duty).
2. Such foreign country enforces
or passed a law, regulation or
practice relative to customs
which places Philippine
commerce at a disadvantage as
compared as to the commerce
of other foreign countries.
Q: who has the authority to impose
this duty?
A: the president of the Philippines
upon the recommendation of the
tariff commission.
Q: how much is the amount of DD
that could be imposed?
A: the president of the Philippines
is authorized to impose new or
additional duties as discriminatory
duty in an amount not exceeding
 100% ad valorem if public interest
requires.
Q: what may the president of the
Philippines if the discrimination is
continued, maintained or
increased?
A: Ban the importation of goods
coming from that foreign country
practicing discrimination or ban
goods imported into the Philippines
carried by vessels of that foreign
country practicing discriminations.
Q: suppose after the imposition of the
Ban, still products coming from that
foreign country is imported in the
Philippines, what will the recourse of
the government?
A: it will be subject said goods to
seizure and forfeiture
Q: For how long may the
discriminatory duty be imposed?
A: for as long as public interest
requires or if not president may
amend the proclamation imposing DD
Safeguard duty
Note found in CMAT because it is
provided for by RA 8800 but sec 712
of the CMAT adopts the said Act.
Different kinds of SM
1. GENERAL SM
2. Special SM
Q: what are the circumstances
required to be present so that this
SMA will apply?
A: There must be a finding by the TC
that a product is being imported in the
Philippines in increased quantity so as
to substantial cause serious injury or
threat to domestic industry.
Note: as compared To ADD where the
cost of lesser, here importation is
increased quantity.
Requisites to justify the imposition of
the GSM
1. There must be increased import
2. There must serious injury or
threat to domestic industry
3. There must be a causal link
between the increased
importation and serious injury
or threat to domestic industry
Note: in the case of non-
agricultural product, the
application of GSM must be as
public interest dictates.