R.A. No. 1937 P.D. No. 1434 R.A. No. 9135 R.A. No. 7651 R.A. No.
A. No. 9135 R.A. No. 7651
An Act to Revise and Codify
the Tariff and Customs Laws
of the Philippines
BOOK I
TARIFF LAW
TITLE I
IMPORT TARIFF
Section 101. Imported
Articles Subject to Duty. —
All articles, when imported
from any foreign country into
the Philippines, shall be
subject to duty upon each
importation, even though
previously exported from the
Philippines, except as
R.A. No. 7650
A Decree to Consolidate and An Act amending certain
Codify all the Tariff and provisions of P.D. No. 1434
Customs Laws of the
Philippines
Section 1. Sec. 201 of the
Tariff and Customs Code of
the Philippines, as amended,
is hereby further amended to
read as follows:
TITLE 1
IMPORT TARIFF
Section 100.
R.A. No. 10863
An Act to revitalize and
strengthen the BOC,
amending for the purpose of
certain sections of R.A. No.
9135
Section 1. Sections 1210,
1301, 1801, 1802, 2301,
2313, 2503, 2601, and 3407
of the Tariff and Customs
Code, as amended, are
hereby further amended to
read as follows:
An Act repealing section
1404, amending section 1401
and 1403
Section 1. Section 1401 of
the Tariff and Customs Code
of the Philippines as
amended, is hereby further
amended to read as follows:
"Sec. 1401. Conditions for
Examination. — For the
protection of government
revenue and public interest
and to prevent the entry into
the country of smuggled or
contraband goods, the
Commissioner shall, in
consultation with the
Oversight Committee and
subject to the approval of the
Secretary of Finance,
promulgate the rules and
regulations that shall
prescribe the procedure in
accordance with which
examination shall be
undertaken on the
importation and the required
quantity or percentage
thereof: Provided, That the
imported articles shall in any
case be subject to the regular
physical examination when:
An Act Modernizing the
Customs and Tariff
Administration
TITLE I
PRELIMINARY
PROVISIONS
CHAPTER 1
SHORT TITLE
SECTION 100. Short Title. —
This Act shall be known as
the "Customs Modernization
and Tariff Act (CMTA)".
CHAPTER 2
GENERAL AND COMMON
PROVISIONS
Sec. 101. Declaration of
Policy. — It is hereby
declared the policy of the
State to protect and enhance
government revenue, institute
fair and transparent customs
and tariff management that
will efficiently facilitate
international trade, prevent
otherwise specifically
provided for in this Code or in
other laws.
. Importations.
Sec. 102. Prohibited
Importations. — The
importation into the
Philippines of the following
articles is prohibited:
a. Dynamite, gunpowder,
ammunitions and other
explosives, firearm and
weapons of war, and
detached parts thereof,
except when authorized by
law.
. "(4) The shipment is
b. Written or printed article
in any form containing any
matter advocating or inciting
treason, rebellion,
insurrection or sedition
against the Government of
the Philippines, of forcible
resistance to any law of the
Philippines, or containing any
threat to take the life of or
inflict bodily harm upon any
person in the Philippines.
. Collector has knowledge that
c. Written or printed
articles, photographs,
engravings, lithographs,
objects, paintings, drawings
or other representation of an
obscene or immoral
character.
. Sec. 2. Section 1403 of the
d. Articles, instruments,
drugs and substances
"(1) The government
surveyor's seal on the
Sec. 101. Prohibited container has been tampered
with or broken or the
container shows signs of
having been opened or
having its identity changed;
"(2) The container is
leaking or damaged;
"(3) The number, weight
and nature of packages
indicated in the customs
entry declaration and
supporting documents differ
from that in the manifest;
covered by alert/hold orders
issued pursuant to existing
orders;
"(5) The importer
disagrees with the findings as
contained in the government
surveyor's report; or
"(6) The articles are
imported through air freight
where the Commissioner or
there is a variance between
the declared and true
quantity, measurement,
weight, and tariff
classification."
Tariff and Customs Code of
the Philippines, as amended,
and curtail any form of
customs fraud and illegal
acts, and modernize customs
and tariff administration.
Towards this end, the State
shall:
(a) Develop and implement
programs for the continuous
enhancement of customs
systems and processes that
will harmonize customs
procedures;
(b) Adopt clear and
transparent customs rules,
regulations, policies and
procedures, consistent with
international standards and
customs best practices;
(c) Establish a regime of
transparency of and
accessibility to customs
information, customs laws,
rules, regulations,
administrative policies,
procedures and practices, in
order to ensure informed and
diligent compliance with
customs practices and
procedures by stakeholders;
(d) Consult, coordinate and
cooperate with other
government agencies and the
private sector in
implementing and developing
customs policy;
(e) Provide a fair and
expeditious administrative
designed, intended or
adapted for preventing
human conception or
producing unlawful abortion,
or any printed matter which
advertises or describes or
gives directly or indirectly
information where, how or by
whom human conception is
prevented or unlawful
abortion produced.
e. Roulette wheels,
gambling outfits, loaded dice,
marked cards, machines,
apparatus or mechanical
devices used in gambling, or
in the distribution of money,
cigars, cigarettes or other
articles when such
distribution is dependent
upon chance, including
jackpot and pinball machines
or similar contrivances.
. tariff classification and not
f. Lottery and sweepstakes
tickets except those
authorized by the Philippine
Government, advertisements
thereof and lists of drawings
therein.
. appraisal, and/or admission
g. Any article
manufactured in whole or in
part of gold silver or other
precious metal, or alloys
thereof, the stamps brands or
marks of which do not
indicate the actual fineness
or quality of said metals or
alloys.
is hereby further amended to
read as follows:
"Sec. 1403. Duties of
Customs Officer Tasked to
Examine, Classify, and
Appraise Imported Articles.
— The customs officer
tasked to examine, classify,
and appraise imported
articles shall determine
whether the packages
designated for examination
and their contents are in
accordance with the
declaration in the entry,
invoice and other pertinent
documents and shall make
return in such a manner as to
indicate whether the articles
have been truly and correctly
declared in the entry as
regard their quantity,
measurement, weight, and
imported contrary to law. He
shall submit samples to the
laboratory for analysis when
feasible to do so and when
such analysis is necessary
for the proper classification,
into the Philippines of
imported articles.
"Likewise, the customs
officer shall determine the
unit of quantity in which they
are usually bought and sold
and appraise the imported
articles in accordance with
Section 201 of this Code.
and judicial appellate remedy
for customs related
grievances and matters;
(f) Employ modern practices
in customs administration
and utilize information and
communications technology
in the implementation of
customs functions; and (g)
Institute professionalism and
meritocracy in customs tax
administration by attracting
and retaining competent and
capable customs officers and
personnel to enforce the
provisions of this Act.
Sec. 102. Definition of Terms.
- As used in this Act:
(a) Abatement refers to the
reduction or diminution, in
whole or in part, of duties and
taxes where payment has not
been made;
(b) Actual or Outright
Exportation refers to the
customs procedure
applicable to goods which,
being in free circulation,
leave the Philippine territory
and are intended to remain
permanently outside it;
(c) Admission refers to the
act of bringing imported
goods directly or through
transit into a free zone;
 h. Any adulterated or
misbranded article of food or
any adulterated or
misbranded drug in violation
of the provisions of the "Food
and Drugs Act."
i. Marihuana, opium
poppies, coca leaves, or any
other narcotics or synthetic
drugs which are or may
hereafter be declared habit
forming by the President of
the Philippines, any
compound, manufactured
salt, derivative, or preparation
thereof, except when
imported by the Government
of the Philippines or any
person duly authorized by the
Collector of Internal
Revenue, for medicinal
purposes only.
j. Opium pipes and parts
thereof, of whatever material.
k. All other articles the
importation of which is
prohibited by law.
Sec. 103.Abbreviations. —
The following abbreviations in
this Code shall represent the
terms indicated:
ad. val. For ad valorem
. .
e.g. For exempli gratia,
meaning "for example"
. broker, forwarder, freight
(i) Marijuana, opium,
pipes, coca leaves, heroin or
any other narcotics or
synthetic drugs which are or
may hereafter be declared
habit forming by the
President of the Philippines,
or any compound,
manufactured salt, derivative,
or preparation thereof, except
when imported by the
Government of the
Philippines or any person
duly authorized by the
Dangerous Drugs Board, for
medicinal purposes only.
(d) Airway Bill (AWB) refers
"Failure on the part of theto a transport document for
customs officer to comply airfreight used by airlines and
with his duties shall subject international freight
him to the penalties forwarders which specify the
prescribed under Section holder or consignee of the bill
3604 of this Code." who has the right to claim
delivery of the goods when
they arrive at the port of
Sec. 3. An Oversight destination. It is a contract of
Committee is hereby created carriage that includes carrier
which shall be composed of conditions, such as limits of
the Chairmen of the liability and claims
Committees on Ways and procedures. In addition, it
Means of the Senate and of contains transport
the House of Representatives instructions to airlines and
and four (4) additional carriers, a description of the
members from each House to goods, and applicable
be designated by the Senate transportation charges;
President and the Speaker of
the House of (e) Appeal refers to the
Representatives, remedy by which a person
respectively. who is aggrieved or
adversely affected by any
action, decision, order, or
omission of the Bureau,
The Oversight Committee seeks redress before the
shall monitor and ensure the Bureau, the Secretary of
proper implementation of this Finance, or competent court,
Act. as the case may be;
Sec. 4. Nothing in the (f) Assessment refers to the
preceding section shall process of determining the
authorize the removal of any amount of duties and taxes
examiner and appraiser and other charges due on
whose functions are merged imported and exported
under the position of customs goods;
officer.
(g) Authorized Economic
Sec. 5. Section 1404 of the Operator (ABO) refers to the
Tariff and Customs Code of importer, exporter, customs
 i.e. For id est, meaning
"that is"
. Sec. 102. Abbreviations. —
hd. For head
. Finance shall, upon the
kgs. For kilograms
. Commissioner of Customs,
l. For liter
. rules and regulations for the
g.w. For gross weight
. this Act.
l.w. For legal weight
n.w. For net weight
Sec. 103. General Rules for
the Interpretation of the
Harmonized System. —
Classification of goods in the
Nomenclature shall be
governed by the following
principles:
1. The titles of Sections,
Chapters and Sub-Chapters
are provided for ease of
reference only; for legal
purposes, classifications shall
the Philippines, as amended,
is hereby repealed.
Sec. 6. The Secretary of
recommendation of the
promulgate the necessary
effective implementation of
Sec. 7. All laws, decrees,
orders, rules and regulations,
and other issuances
inconsistent with this Act are
hereby repealed or modified
accordingly.
Sec. 8. This Act shall take
effect upon its approval.
forwarder, transport provider,
and any other entity duly
accredited by the Bureau
based on the World Customs
Organization (WCO)
Framework of Standards to
Secure and Facilitate Global
Trade, the Revised Kyoto
Convention (RKC), the WCO
Supply Chain Management
Guidelines and the various
national best practices to
promote trade facilitation and
to provide a seamless
movement of goods across
borders through secure
international trade supply
chains with the use of risk
management and modern
technology;
(h) Bill of Lading (B/L) refers
to a transport document
issued by shipping lines,
carriers and international
freight forwarders or non-
vessel operating common
carrier for water-borne
freight. The holder or
consignee of the bill has the
right to claim delivery of the
goods at the port of
destination. It is a contract of
carriage that includes earner
conditions, such as limits of
liability and claims
procedures. In addition, it
contains transport
instructions to shipping lines
and carriers, a description of
the goods, and applicable
transportation charges;
be determined according to
the terms of the headings
and any relative Section or
Chapter Notes and, provided
such headings or Notes do
not otherwise require,
according to the following
provisions.
. means of transport such as
2. (a) Any reference in a
heading to an article shall be
taken to include a reference
to that article incomplete or
unfinished, provided that, as
presented, the incomplete or
unfinished article has the
essential character of the
complete or finished article. It
shall also be taken to include
a reference to that article
complete or finished (or
falling to be classified as
complete or finished by virtue
of this Rule), presented
unassembled or
disassembled.
(b) Any reference in a
heading to a material or
substance shall be taken to
include a reference to
mixtures or combinations of
that material or substance
with other materials or
substances. Any reference to
goods of a given material or
substance shall be taken to
include a reference to goods
consisting wholly or partly of
such material or substance.
The classification of goods
consisting or more than one
(i) Bureau refers to the
Bureau of Customs;
(j) Carrier refers to the person
actually transporting goods or
in charge of or responsible
for the operation of the
airlines, shipping lines, freight
forwarders, cargo
consolidators, non-vessel
operating common carriers
and other international
transport operators;
(k) Clearance refers to the
completion of customs and
other government formalities
necessary to allow goods to
enter for consumption,
warehousing, transit or
transshipment, or to be
exported or placed under
another customs procedure;
(l) Commission refers to the
Tariff Commission;
(m) Conditional Importation
refers to the customs
procedure known under the
RKC as temporary admission
in which certain goods can be
brought into a customs
territory conditionally
relieved, totally or partially,
from payment of import
duties and taxes; such goods
must be imported for a
specific purpose and must be
intended for reexportation
material or substance shall
be according to the principles
of Rule 3.
3. When by application of
Rule 2 (b) or for any other
reason, goods are, prima
facie, classifiable under two
or more headings,
classification shall be
effected as follows:
(a) The heading which
provides the most specific
description shall be preferred
to headings providing a more
general description.
However, when two or more
headings each refer to part
only of the materials or
substances contained in
mixed or composite goods or
to part only of the items in a
set put for retail sale, those
headings are to be regarded
as equally specific in relation
to those goods, even if one of
them gives a more complete
or precise description of the
goods.
. distinguished from a clerk or
(b) Mixtures, composite
goods consisting of different
materials or made up of
different components, and
goods put up in sets for retail
sale, which cannot be
classified by reference to
3(a), shall be classified as if
they consisted of the material
or component which gives
them their essential character
within a specified period and
without having undergone
any substantial change
except due to normal
depreciation;
(n) Customs Broker refers to
any person who is a bona
fide holder of a valid
Certificate of
Registration/Professional
Identification Card issued by
the Professional Regulatory
Board and Professional
Regulation Commission
pursuant to Republic Act No.
9280, as amended, otherwise
known as the "Customs
Brokers Act of 2004";
(o) Customs Office refers to
any customs administrative
unit that is competent and
authorized to perform all or
any of the functions
enumerated under customs
and tariff laws;
(p) Customs Officer, as
employee, refers to a person
whose duty, not being clerical
or manual in nature, involves
the exercise of discretion in
performing the function of the
Bureau. It may also refer to
an employee authorized to
perform a specific function of
the Bureau as provided in
this Act;
insofar as this criterion is
applicable.
(c) When goods cannot
be classified by reference to
3 (a) or 3 (b), they shall be
classified under the heading
which occurs last in
numerical order among those
which equally merit
consideration.
4. Goods which cannot be
classified in accordance with
the above Rules shall be
classified under the heading
appropriate to the goods to
which they are most akin.
. to a statement made in the
5. In addition to the
foregoing provisions, the
following Rules shall apply in
respect to the goods referred
to therein:
(a) Camera cases,
musical instrument cases,
gun cases, drawing
instrument cases, necklace
cases and similar containers,
specifically shaped or fitted to
contain a specific article or
set of articles, suitable for
long-term use and presented
with the articles for which
they are intended, shall be
classified with such articles
when of a kind normally sold
therewith.The Rule does not,
however, apply to containers
which give the whole its
essential character;
(q) Customs Territory refers
to areas in the Philippines
where customs and tariff laws
may be enforced;
(r) Entry refers to the act,
documentation and process
of bringing imported goods
into the customs territory,
including goods coming from
free zones;
(s) Exportation refers to the
act, documentation, and
process of bringing goods out
of Philippine territory;
(t) Export Declaration refers
manner prescribed by the
Bureau and other appropriate
agencies, by which the
persons concerned indicate
the procedure to be observed
for taking out or causing to be
taken out any exported goods
and the particulars of which
the customs administration
shall require;
(u) Flexible Clause refer to
the power of the President
upon recommendation of the
National Economic and
Development Authority
(NEDA): (1) to increase,
reduce or remove existing
protective tariff rates of
import duty, but in no case
shall be higher than one
hundred percent (100%) ad
valorem; (2) to establish

Sec. 104. Rates of Import
Duty. — There shall be
levied, collected and paid
upon all imported articles the
following rates of duty, except
as otherwise specifically
provided for in this Code.
. rates of duty indicated in the
. import quota or to ban
(b) Subject to the
provisions of Rule 5(a)
above, packing materials and
packing containers presented
with the goods therein shall
be classified with the goods if
they are of a kind normally
used for packing such
goods.However, this
provision does not apply
when such packing materials
or packing containers are
clearly suitable for repetitive
use.
6. For legal purposes, the
classification of goods in the
subheadings of a heading
shall be determined
according to the terms of
those subheadings and any
related Subheading Notes
and, mutatis mutandis, to the
above Rules, on the
understanding that only
subheadings at the same
level are comparable.For the
purposes of the Rule the
relative Section and Chapter
Notes also apply, unless the
context otherwise requires.
Sec. 104. Rates of Import
Duty. — There shall be
levied, collected, and paid
upon all imported articles the
Section except as otherwise
specifically provided for in
this Code: provided, that the
maximum rate shall not
importation of any commodity
as may be necessary; and (3)
to impose additional duty on
all import not exceeding ten
percent (10%) ad valorem,
whenever necessary;
(v) Foreign Exporter refers to
one whose name appears on
documentation attesting to
the export of the product to
the Philippines regardless of
the manufacturer's name in
the invoice;
(w) 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; Poro Point
Freeport Zone; John Hay
Special Economic Zone and
Subic Bay Freeport Zone
under Republic Act No. 7227,
as amended by Republic Act
No. 9400; the Aurora Special
Economic Zone under
Republic Act No. 9490, as
amended; the Cagayan
Special Economic Zone and
Freeport under Republic Act
No. 7922; the Zamboanga
City Special Economic Zone
under Republic Act No. 7903;
the Freeport Area of Bataan
under Republic Act No. 9728;

(This portion containing the
voluminous description of
rates of import duties, has
been deleted for the
convenience of readers who
are more interested on the
substantive provisions of the
Code)
. are more interested on the
exceed one hundred per cent
ad valorem.
The rates of duty herein
provided or subsequently
fixed pursuant to Section four
hundred one of this Code
shall be subject to periodic
investigation by the Tariff
Commission and may be
revised by the President
upon recommendation of the
National Economic and
Development Authority.
The rates of duty herein
provided shall apply to all
products whether imported
directly or indirectly of all
foreign countries, which do
not discriminate against
Philippine export products.
An additional 100% across-
the-board duty shall be levied
on the products of any
foreign country which
discriminates against
Philippine export products.
The tariff Sections, Chapters,
headings and subheadings
and the rate of import duty
under Section one hundred
four of this Code shall be as
follows:
. on behalf of its client without
(This portion containing the
voluminous description of
rates of import duties, has
been deleted for the
convenience of readers who
and such other freeports as
established or may be
created by law;
(x) Goods refer to articles,
wares, merchandise and any
other items which are subject
of importation or exportation;
(y) Goods Declaration refers
to a 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;
(z) Importation refers to the
act of bringing in of goods
from a foreign territory into
Philippine territory, whether
for consumption,
warehousing, or admission
as defined in this Act;
(aa) Freight Forwarder refers
to a local entity that acts as a
cargo intermediary and
facilitates transport of goods
assuming the role of a
carrier, which can also
perform other forwarding
services, such as booking
cargo space, negotiating
freight rates, preparing
documents, advancing freight
Sec. 105. Conditionally Free
Importations. — The
following articles shall be
exempt from the payment of
import duties upon
compliance with the
formalities prescribed in, or
with the regulations which
shall be promulgated by the
Commissioner of Customs
with the approval of the
department head:
substantive provisions of the
Code)
. warehousing, engaging as an
Sec. 105. Conditionally-Free
Importations. — The
following articles shall be
exempt from the payment of
import duties upon
compliance with the
formalities prescribed in, or
with, the regulations which
shall be promulgated by the
Commissioner of Customs
with the approval of the
Secretary of Finance;
Provided, That any article
sold, bartered, hired or used
for purposes other than that
they were intended for
without prior payment of the
duty, tax or other charges
which would have been due
and payable at the time of
entry if the article had been
entered without the benefit of
this section, shall be subject
to forfeiture and the
importation shall constitute a
fraudulent practice against
customs revenue punishable
under Section Thirty-six
hundred and two, as
amended of this Code:
Provided, further, That a sale
pursuant to a judicial order or
in liquidation of the estate of
a deceased person shall be
subject to the preceding
proviso, without prejudice to
the payment of duties, taxes
and other charges: Provided,
payments, providing
packing/crating, trucking and
agent/representative of a
foreign non-vessel operating
as a common carrier/cargo
consolidator named in a
master bill of lading as
consignee of a consolidated
shipment, and other related
undertakings;
(bb) International Freight
Forwarder refers to persons
responsible for the assembly
and consolidation of
shipments into single lot, and
assuming, in most cases, the
full responsibility for the
international transport of such
shipment from point of receipt
to the point of destination;
(cc) Jurisdictional Control
refers to the power and rights
of the Bureau in exercising
supervision and police
authority over all seas within
the jurisdiction of the
Philippine territory and over
all coasts, ports, airports,
harbors, bays, rivers and
inland waters whether
navigable or not from the
sea;
(dd) Lodgement refers to the
registration, of a goods
declaration with the Bureau; r
(ee) Non-Vessel Operating
Common Carrier (NVOCC)
refers to an entity, which may
 finally, That the President
may upon recommendation
of the Secretary of Finance,
suspend, disallow or
completely withdraw, in
whole or in part, any of the
conditionally-free importation
under this section:
or may not own or operate a
vessel that provides a point-
to-point service which may
include several modes of
transport and/or undertakes
group age of less container
load (LCL) shipments and
issues the corresponding
transport document;

(ff) Outright Smuggling refers

a. Animals and plants for to an act of importing goods
scientific, experimental, into the country without
propagation, botanical, complete customs prescribed
breeding, zoological and importation documents, or
national defense purposes: without being cleared by
Provided, That no live trees, customs or other regulatory
shoots, plants and moss, and government agencies, for the
bulbs, tubers and seeds for purpose of evading payment
propagation purposes may of prescribed taxes, duties
be imported under this and other government
section, except by order of charges;
the Government of the
Philippines or other duly (gg) Perishable Good refers
authorized institutions: to goods liable to perish or
Provided, further, That the goods that depreciate greatly
free entry of animals for in value while stored or which
breeding purposes shall be cannot be kept without great
restricted to animals of a disproportionate expense,
recognized breed, duly which may be proceeded to,
registered in the book of advertised and sold at
record established for that auction upon notice if
breed: And Provided, finally, deemed reasonable;
That certificate of such
record, and pedigree of such (hh) Port of Entry refers to a
animal duly authenticated by domestic port open to both
the proper custodian of such domestic and international
book of record, shall be trade, including principal
produced and submitted to ports of entry and subports of
the Collector of Customs, entry. A principal port of entry
together with affidavit of the is the chief port of entry of the
owner or importer, that such Customs District wherein it is
animal is the identical animal
described in said certificate of
record and pedigree.
. fishes, crustaceans,
b. Aquatic products (e.g.,
fish, crustaceans, mollusks,
marine animals, seaweed,
fish oil, roe), including
preparations or manufactures
thereof, caught or gathered
by vessels of Philippine
registry: Provided, That they
are imported in such vessels
or in crafts attached thereto:
And Provided, further, That
they have not been landed in
any foreign territory or, if so
landed, they have been
landed solely for
transshipment without having
been advanced in condition.
. exportation of goods which
c. Samples of the kind, in
such quantity and of such
dimensions or construction
as to render them unsalable
or of no appreciable
commercial value, models
not adapted for practical use
and samples of medicine
properly marked "physicians'
samples not for sale".
Commercial samples,
except those that are not
readily and easily identifiable
(e.g., precious and semi-
precious stones, cut or uncut,
and jewelry set with precious
or semi-precious stones), the
value of any single
importation of which does not
a. Aquatic products (e.g.,
mollusks, marine animals,
seaweeds, fish oil, roe),
caught or gathered by fishing
vessels of Philippine registry:
Provided, That they are
imported in such vessels or in
crafts attached thereto: And
provided, further, That they
have not been landed in any
foreign territory or, if so
landed, they have been
landed solely for
transshipment without having
been advanced in condition;
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;
(ii) Port of Discharge, also
called Port of Unloading,
refers to a place where a
vessel, ship, aircraft or train
unloads its shipments, from
where they will be dispatched
to their respective
consignees;
(jj) Reexportation means
have been imported;
(kk) Release of Goods refers
to the action by the Bureau to
permit goods undergoing
clearance to be placed at the
disposal of the party
concerned;
(ll) Refund refers to the
return, in whole or in part, of
duties and taxes paid on
goods;
(mm) Security refers to any
form of guaranty, such as a
surety bond, cash bond,
standby letter of credit or
irrevocable letter of credit,
which ensures the
exceed ten thousand pesos,
upon the giving of a bond in
an amount equal to one and
one-half times the
ascertained duties, taxes and
other charges thereon,
conditioned for the
exportation of said samples
within six months from the
date of the acceptance of the
import entry, or in default
thereof, the payment of the
corresponding duties, taxes
and other charges. If the
value of any single
consignment of such
commercial samples exceeds
ten thousand pesos, the
importer thereof may select
any portion of same not
exceeding in value ten
thousand pesos for entry
under the provisions of this
subsection, and the excess of
the consignment may be
entered in bond, or for
consumption, as the importer
may elect.
. goods into the country by
d. Articles, including
binnacles, propellers, and the
like, the character of which,
as imported, prevents their
use for other purposes than
the construction, equipment,
or repair of vessels and
aircraft, and life-preservers
and life buoys, related
equipment and parts and
accessories thereof, which
are necessary for the take-off
and landing and for the safe
satisfaction of an obligation to
the Bureau;
(nn) Smuggling refers to the
fraudulent act of importing
any goods into the
Philippines, or the act of
assisting in receiving,
concealing, buying, selling,
disposing or transporting
such goods, with full
knowledge that the same has
been fraudulently imported,
or the fraudulent exportation
of goods. Goods referred to
under this definition shall be
known as smuggled goods;
(oo) Taxes refer to all taxes,
fees and charges imposed
under this Act and the
National Internal Revenue
Code (NIRC) of 1997, as
amended, and collected by
the Bureau;
(pp) Technical Smuggling
refers to the act of importing
means of fraudulent, falsified
or erroneous declaration of
the goods to its nature, kind,
quality, quantity or weight, for
the purpose of reducing or
avoiding payment of
prescribed taxes, duties and
other charges;
(qq) Tentative Release refers
to a case where the
assessment is disputed and
pending review, an importer
navigation of vessels and
aircraft.
e. Equipment for use in the
salvage of vessels or aircraft,
upon identification and the
giving of a bond in an amount
equal to one and one-half
times the ascertained duties,
taxes and other charges
thereon, conditioned for the
exportation thereof or
payment of the
corresponding duties, taxes
and other charges within six
months from the date of
acceptance of the import
entry: Provided, That the
Collector of Customs may
extend the time for
exportation or payment of
duties, taxes and other
charges for a term not
exceeding six months from
the expiration of the original
period.
f Cost of repairs made in
foreign countries upon
vessels or aircraft
documented, registered or
licensed in the Philippines,
upon proof satisfactory to the
Collector of Customs (1) that
adequate facilities for such
repairs are not afforded in the
Philippines, or (2) that such
vessels or aircraft, while in
the regular course of her
voyage or flight was
compelled by stress of
weather or other casualty to
b. Equipment for use in the
salvage of vessels or
aircrafts, not available locally,
c. Cost of repairs,
excluding the value of the
article used,
may put up a cash bond
equivalent to the duties and
taxes due on goods before
the importer can obtain the
release of said goods;
(rr) Transit refers to the
customs procedure under
which goods, in its original
form, are transported under
customs control from one
customs office to another, or
to a free zone;
(ss) Transshipment refers to
the customs procedure under
which goods are transferred
under customs control from
the importing means of
transport to the exporting
means of transport within the
area of one customs office,
which is the office of both
importation and exportation;
(tt) Traveler refers to any
person who temporarily
enters the territory of a
country in which he or she
does not normally resides
(non-resident), or who leaves
that territory, and any person
who leaves the territory of a
country in which he or she
normally resides (departing
resident) or who returns to
that territory (returning
resident); and
(uu) Third Party refers to any
person who deals directly
with the Bureau, for and on
put into a foreign port to
make such repairs in order to
secure the safety
seaworthiness or
airworthiness of the vessel or
aircraft to enable her to reach
her port of destination.
. processing or reconditioning
g. Articles brought into the
Philippines for repair,
processing or reconditioning
to be re-exported upon
completion of the repair,
processing or reconditioning:
Provided, That the Collector
of Customs may, in his
discretion, require the giving
of a bond in an amount equal
to one and one-half times the
ascertained duties, taxes and
other charges thereon,
conditioned for the
exportation thereof or
payment of the
corresponding duties, taxes
and other charges within six
months from the date of
acceptance of the import
entry.
. jurisdiction of the Bureau.
h. Medals, badges, cups
and other small articles
bestowed as trophies or
prizes, or those received or
accepted as honorary
distinctions.
i. Wearing apparel and
household effects, including
those articles provided for
under subsections "j" and "k",
and belonging to residents of
d. Articles brought into the
Philippines for repair,
… begins when the carrying
e. Medals…..
f. Personal and household
effects belonging to residents
of the Philippines returning
from abroad including
jewelry, precious stones and
other articles of luxury which
were formally declared and
listed before departure and
behalf of another person,
relating to the importation,
exportation, movement or
storage of goods.
Sec. 103. When Importation
Begins and Deemed
Terminated. – Importation
vessel or aircraft enters the
Philippine territory with the
intention to unload therein.
Importation is deemed
terminated when:
(a) 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: or
(b) In case the goods are
deemed free of duties, taxes
and other charges, the goods
have legally left the
Sec. 104. When Duty and
Tax are Due on Imported
Goods. – Except as
otherwise provided for in this
Act or in other laws, all
goods, when imported into
the Philippines, shall be
subject to duty upon
importation, including goods
previously exported from the
Philippines.
the Philippines returning from
abroad, which were exported
from the Philippines by such
returning residents upon their
departure therefrom or during
their absence abroad, upon
the identity of such articles
being established to the
satisfaction of the Collector of
Customs; personal and
household effects brought
into the Philippines by
returning residents, the
export value of which does
not exceed five hundred
pesos, solely for personal or
household use but not
imported for the account of
any other person nor
intended for barter, sale or
hire: Provided, That such
returning residents have not
received the benefit of any
exemption hereunder within
one hundred and eighty days
from and after the date of the
last exemption granted: And
Provided, further, That in the
event the total export value of
the imported article or articles
exceeds the amount of five
hundred pesos, such article
or articles shall be subject to
duty only on the amount in
excess of five hundred
pesos; articles of the same
kind and class purchased in
foreign countries by residents
of the Philippines during their
absence abroad and
accompanying them upon
their return to the Philippines,
identified under oath before
the Collector of Customs
when exported from the
Philippines by such returning
residents upon their
departure therefrom and
during their stay abroad;
personal and household
effects including wearing
apparel, articles of personal
adornment (except luxury
items), toilet articles, portable
appliances and instruments
and similar personal effects,
excluding vehicles,
watercrafts, aircrafts, and
animals purchased in foreign
countries by residents of the
Philippines which were
necessary, appropriate and
normally used for the comfort
and convenience in their
journey and during their stay
abroad upon proof
satisfactory to the Collector of
Customs that same have
been in their use abroad for
more than six (6) months and
accompanying them on their
return, or arriving within a
reasonable time which,
barring unforeseen
circumstances, in no case
shall exceed ninety (90) days
before or after the owners'
return: Provided, That the
personal and household
effects shall neither be in
commercial quantities nor
intended for barter, sale or
hire and that the total dutiable
value of which shall not
Unpaid duties, taxes and
other charges, shall incur
legal interest of twenty
percent (20%) per annum
computed from the date of
final assessment under
Section 429 of this Act, when
payment becomes due and
demandable. The legal
interest shall likewise accrue
on any fine or penalty
imposed.
Upon payment of the duties,
taxes and other charges, the
Bureau shall issue the
necessary receipt or
document as proof of such
payment.
Sec. 105. Effective Date of
Rate of Import Duty. –
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.
In case of goods sold at
customs public auction, the
or arriving within a
reasonable time which in no
case shall exceed ninety (90)
days before or after the
owner's return, upon proof
satisfactory to the Collector of
Customs that same have
been in their use abroad for
more than one year; articles
in any single shipment
consigned to any single
person when the total export
value of such shipment does
not exceed one hundred
pesos: Provided, finally, That
when the export value
exceeds the amount of one
hundred pesos, only the
amount in excess of one
hundred pesos shall be
subject to duty.
j. Wearing apparel, articles
of personal adornment, toilet
articles, portable tolls and
instruments, theatrical
costumes, and similar
personal effects,
accompanying travelers or
tourists in their baggage or
arriving within a reasonable
exceed two thousand pesos
(P2,000.00): Provided further,
That the returning residents
have not previously received
the benefit under this section
within one year from and
after the last exemption
granted: Provided
furthermore, That a fifty (50)
per cent ad valorem duty
across the board shall be
levied and collected on the
personal and household
effects (except luxury items)
in excess of two thousand
pesos (P2,000.00): And
provided, finally, That the
personal and household
effects (except luxury items)
of a returning resident who
has not stayed abroad for six
(6) months shall be subject to
fifty (50)per cent ad valorem
duty across the board, the
total dutiable value of which
does not exceed two
thousand pesos (P2,000.00);
any excess shall be subject
to the corresponding duty
provided in this Code;
g. Wearing apparel,
articles of personal
adornment, toilet articles,
portable tools and
instruments, theatrical
costumes and similar effects
accompanying travelers, or
tourists. or arriving within a
reasonable time before and
after their arrival in the
Philippines, which are
duty rates at the date of the
auction, shall apply for
purposes of implementing
Section 1143(a) of this Act.
Sec. 106. Declarant. – A
declarant may be a
consignee or a person who
has the right to dispose of the
goods. The declarant shall
lodge a goods declaration
with the Bureau and may be:
(a) The importer, being the
holder of the bill of lading; or
(b) The exporter, being the
owner of the goods to be
shipped out; or
(c) A customs broker acting
under the authority of the
importer or from a holder of
the bill; or
(d) A person duly empowered
to act as agent or attorney-in-
fact for each holder.
In case the consignee or the
person who has the right to
dispose of the goods is a
juridical person, it may
authorize a responsible
officer of the company to sign
the goods declaration as
declarant on its behalf.
The goods declaration
submitted to the Bureau shall
be processed by the
declarant or by a licensed
time, in the discretion of the
Collector of Customs, before
or after the owners, in use of
and necessary and
appropriate for the wear or
use of such persons
according to their profession
or position for the immediate
purposes of their journey and
their present comfort and
convenience: Provided, That
this exemption shall not be
held to apply to articles
intended for other persons or
for barter, sale or hire:
Provided, further, That the
Collector of Customs may, in
his discretion, require a bond
in an amount equal to one
and one-half times the
ascertained duties, taxes and
other charges upon articles
classified under this
subsection, conditioned for
the exportation thereof or
payment of the
corresponding duties, taxes
and other charges, within six
months from the date of
acceptance of the import
entry: And Provided, finally,
That the Collector of
Customs may extend the
time for exportation or
payment of duties, taxes and
other charges for a term not
exceeding six months from
the expiration of the original
period.
k. Vehicles, horses,
harness, bed and table linen,
necessary and appropriate
for the wear and use of such
persons according to the
nature of the journey, their
comfort and convenience:
Provided, ….
within three (3) months from
the date of acceptance of the
import entry: And Provided
finally, That the Collector of
Customs may extend the
time for exportation or
payment of duties, taxes and
other charges for a term not
exceeding three (3) months
from the expiration of the
original period;
g-1. Personal and
household effects and
vehicles belonging to foreign
consultants and experts hired
by, and/or rendering service
customs broker: Provided,
That for importations, a
transition period of two (2)
years from the effectivity of
this Act is hereby provided
during which subparagraph
(d) of this section shall not be
implemented by the Bureau:
Provided, further, That after
two (2) years from the
effectivity of this Act,
subparagraph (d) of this
section shall take into effect
consistent with international
standards and customs best
practices.
Sec. 107. Rights and
Responsibilities of the
Declarant. – The declarant
shall be responsible for the
accuracy of the goods
declaration and for the
payment of all duties, taxes
and other charges due on the
imported goods. The licensed
customs broker shall likewise
be responsible for the
accuracy of the goods
declaration but shall not be
responsible for the payment
of duties, taxes and other
charges due on the imported
goods.
The declarant shall sign the
goods declaration, even
when assisted by a licensed
customs broker, who shall
likewise sign the goods
declaration.
table service, furniture,
musical instruments and
personal effects of like
character, owned and
imported by travelers or
tourists for their convenience
and comfort, upon
identification and the giving of
a bond in an amount equal to
one and one-half times the
ascertained duties, taxes and
other charges thereon,
conditioned for the
exportation thereof or
payment of the
corresponding duties, taxes
and other charges within six
months from the date of
acceptance of the import
entry: Provided, That the
Collector of Customs may
extend the time for
exportation or payment of
duties, taxes and other
charges for a term not
exceeding six months from
the expiration of the original
period.
. contract; And Provided,
to, the government, and their
staff or personnel and
families, accompanying them
or arriving within a
reasonable time before or
after their arrival in the
Philippines, in quantities and
of the kind necessary and
suitable to the profession,
rank or position of the person
importing them, for their own
use and not for barter, sale or
hire provided that, the
Collector of Customs may in
his discretion require either a
written commitment or a bond
in an amount equal to one
and one-half times the
ascertained duties, taxes and
other charges upon the
articles classified under this
subsection; conditioned for
the exportation thereof or
payment of the
corresponding duties, taxes
and other charges within six
(6) months after the
expiration of their term or
finally, That the Collector of
Customs may extend the
time for exportation or
payment of duties, taxes and
other charges for term not
exceeding six (6) months
from the expiration of the
original period;
h. Professional instruments
and implements, tools of
trade, occupation or
employment, wearing
Sec. 108. Penalties for Errors
in Goods Declaration. – The
Bureau shall not impose
substantial penalties for
errors when such errors are
inadvertent and there was no
fraudulent intent or gross
negligence in the commission
thereof: Provided, That in
order to discourage repetition
of such errors, a penalty may
be imposed but shall not be
excessive.
Sec. 109. Application of
Information and
Communications Technology.
– In accordance with
international standards, the
Bureau shall utilize
information and
communications technology
to enhance customs control
and to support a cost-
effective and efficient
customs operations geared
towards a paperless customs
environment.
The Bureau shall
communicate, exchange and
process trade- and logistics-
related information in the
national and regional level for
the efficient and prompt
clearance of goods and
commodities in a technology-
neutral and secured
infrastructure for business,
industries, and government.
 l. Professional instruments
and implements, tools of
trade, occupation or
employment, wearing
apparel, domestic animals,
and personal and household
effects, including those of the
kind and class provided for
under subsections "j" and "k"
and belonging to persons
coming to settle in the
Philippines, in quantities and
of the class suitable to the
profession, rank or position of
the person importing them,
for their own use and not for
barter or sale, accompanying
such persons, or arriving
within a reasonable time, in
the discretion of the Collector
of Customs, before or after
the arrival of their owners,
upon the production of
evidence satisfactory to the
Collector of Customs that
such persons are actually
coming to settle in the
Philippines, that the articles
are brought from their former
place of abode, that change
of residence is bona fide, and
that the privilege of free entry
under this subsection has
never been previously
granted to them: Provided,
That neither merchandise of
any kind, nor machinery or
other articles for use in
manufacture, shall be
classified under this
subsection.
apparel, domestic animals,
and personal and household
effects belonging to persons
coming to settle in the
Philippines or Filipinos and/or
their families and
descendants who are now
residents or citizens of other
countries, such parties
hereinafter referred to as
Overseas Filipinos, in
quantities and of the class
suitable to the profession,
rank or position of the
persons importing them, for
their own use and not for
barter or sale, accompanying
such persons, or arriving
within a reasonable time, in
the discretion of the Collector
of Customs, before or after
the arrival of their owners,
which shall not be later than
February 28, 1979 upon the
production of evidence
satisfactory to the Collector of
Customs that such persons
are actually coming to settle
in the Philippines, that
change of residence was
bona fide and that the
privilege of free entry was
never granted to them before
or that such person qualifies
under the provisions of
Letters of Instructions 105,
163 and 210, and that the
articles are brought from their
former place of abode, shall
be exempt from the payment
of customs duties and taxes:
Provided, That vehicles,
The security of data and
communication shall be in a
manner that is consistent with
applicable local and
internationally accepted
standards on information
security.
The Bureau shall likewise
include as part of its systems
and processes, a disaster
preparedness and recovery
plan to ensure business
continuity by maintaining its
uptime goal for its electronic
and online services.
For purposes of customs
procedures, electronic
documents, permits, licenses
or certificates shall be
acceptable and shall have
the legal effect, validity or
enforceability as any other
document or legal writing:
Provided, That when the
prescribed requirements are
duly complied with, the
Bureau shall:
(a) Recognize the
authenticity and reliability of
electronic documents;
(b) Transmit approval in the
form of electronic data
messages or electronic
documents; and
(c) Require and/or accept
payments and issue receipts
acknowledging such
 m. Animals, vehicles,
portable theaters, circus and
theatrical equipment,
including musical
instruments, sceneries,
panoramas, properties,
saddlery, wax figures and
similar objects for public
entertainment, and other
articles for display in public
expositions, or for exhibition
or competition for prizes, and
devices for projecting
pictures and parts and
appurtenances therefor, upon
identification and the giving of
a bond in an amount equal to
one and one-half times the
ascertained duties, taxes and
other charges thereon,
conditioned for exportation
thereof or payment of the
corresponding duties, taxes
and other charges within six
months from the date of
acceptance of the import
entry: Provided, That the
Collector of Customs may
extend the time for
exportation or payment of
duties, taxes and other
charges for a term not
exceeding six months from
the expiration of the original
period; and technical and
scientific films when imported
by technical, cultural and
scientific institutions, and not
to be exhibited for profit:
Provided, That if any of the
said films is exhibited for
profit, the proceeds therefrom
vessels, aircrafts,
machineries and other similar
articles for use in
manufacture, shall not be
classified hereunder;
i. Articles used exclusively
for public entertainment, and
for display in public
expositions, or for exhibition
or competitionfor prizes, and
devices for projecting
pictures and parts and
appurtenances thereof, upon
identification, examination,
and appraisal and the giving
of a bond in an amount equal
to one and one-half times the
ascertained duties, taxes and
other charges thereon,
conditioned for exportation
thereof or payment of the
corresponding duties, taxes
and other charges within six
(6) months from the date of
acceptance of the import
entry; Provided, That the
Collector of Customs 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; and technical
and scientific films when
imported by technical,
cultural and scientific
institutions, and not to be
exhibited for profit: Provided,
further, That if any of the said
films is exhibited for profit,
payments through systems
using electronic data
messages or electronic
documents.
The introduction and
implementation of information
and communications
technology shall be
undertaken with due
consultation with directly
affected parties and
stakeholders.
Sec. 110. Relationship
Between the Bureau and
Third Parties. – Parties may
transact business with the
Bureau either directly or
through a designated third
party to act on their behalf.
The customs transactions
directly transacted by a party
shall not be treated less
favorably or be subject to
more stringent requirements
than those transacted
through a designated third
party.
A designated third party shall
have the same rights and
obligations as the designating
party when transacting
business with the Bureau.
Subject to the provisions of
existing laws, treaties,
convention and international
agreements, the Secretary of
Finance shall make the
shall be subject to
confiscation, in addition to the
penalty provided under
section three thousand six
hundred and ten of this Code.
n. Articles (e.g.,
photographic, sound
recording, electrical and other
equipment, vehicles, animals,
costumes, apparel,
properties, supplies,
unexposed motion picture
films) brought by foreign
producers for making or
recording motion pictures on
location in the Philippines,
upon identification and the
giving of a bond in an amount
equal to one and one-half
times the ascertained duties,
taxes and other charges
thereon, conditioned for
exportation thereof or
payment of the
corresponding duties, taxes
and charges within six
months from the date of
acceptance of the import
entry. Unexposed motion
picture films allowed free
entry under bond for
exportation falling within this
subsection and subsequently
exposed, whether or not
developed, may be
reexported free of import
duties, taxes and other
charges.
. identification that such
Negative films,
undeveloped, exposed
the proceeds therefrom shall
be subject to confiscation, in
addition to the penalty
provided under Section
Thirty-six hundred and ten as
amended, of this Code;
j. Articles brought by
foreign film producers directly
and exclusively used for
making or recording motion
picture films on location in the
Philippines, upon their
identification, examination
and appraisal and the giving
of a bond in an amount equal
to one and one-half times the
ascertained duties, taxes and
other charges thereon,
conditioned for exportation
thereof or payment of the
corresponding duties, taxes
and other charges within six
(6) months from the date of
acceptance of the import
entry, unless extended by the
Collector of Customs for
another six (6) months;
photographic and
cinematographic films,
undeveloped, exposed
outside the Philippines by
resident Filipino citizens or by
producing companies of
Philippine registry where the
principal actors and artists
employed for the production
are Filipinos, upon affidavit
by the importer and
exposed films are the same
films previously exported
necessary guidelines for the
defined relationship of the
Bureau and third parties.
Sec. 111. Information of
General Application. – All
laws, decisions, rulings,
circulars, memoranda and
orders of the Bureau shall be
published in accordance with
law.
To foster an informed
compliance regime, the
Bureau shall ensure that all
relevant and available
information of general
application pertaining to
customs operations and
procedures which are not
confidential or intended for
the Bureau's internal use
only, shall be readily
accessible to any interested
person.
Any new information,
amendment or changes in
customs law, administrative
procedures or requirements,
shall, as far as practicable,
be made readily available
prior to its effective date of
implementation unless
advance notice is precluded.
Sec. 112. Information of a
Specific Nature. – The
Bureau shall provide
information, not otherwise
confidential or for the
Bureau's internal use only,
outside the Philippines by
resident Filipino citizens or by
producing companies of
Philippine registry where the
principal actors and artists
employed for the production
are Filipinos, upon affidavit
by the importer that such
exposed films are the same
films previously exported
from the Philippines. As used
in this paragraph, the terms
"actors" and "artists" include
the persons working the
photographic camera or other
photographic and sound
recording apparatus by
means of which the film is
made.
. Articles imported for the
o. Costumes, regalia and
other articles, including office
supplies and equipment,
imported for the official use of
members and attaches of
foreign embassies, legations,
consular officers and other
representatives of foreign
government: Provided, That
the country which any such
person represents accords
like privileges to
corresponding officials of the
Philippines.
. the Secretary of Finance in
Articles imported for the
personal or family use of the
members and attaches of
foreign embassies, legations,
consular officers and other
representatives of foreign
governments: Provided, That
from the Philippines. As used
in this paragraph, the terms
"actors" and "artists" include
the persons operating the
photographic cameras or
other photographic and
sound recording apparatus
by which the film is made;
k. Importations for the
official use of foreign
embassies, legations, and
other agencies of foreign
governments: Provided, That
those foreign countries
accord like privileges to
corresponding agencies of
the Philippines;
personal or family use of the
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: And
Provided, further, That the
privilege may be granted only
upon specific instructions of
each instance which will be
issued only upon request of
the Department of Foreign
Affairs;
l. Imported articles donated
to, or for the account of, any
relating to a specific matter
as may be requested by an
interested party for legitimate
use.
The Bureau may require the
payment of a reasonable fee
in providing such information.
The requested information
shall be release d within
reasonable time from the
filing of the request and
payment of the required fee.
Sec. 113. Decision and
Ruling. – The Bureau shall,
consistent with Section 1502
of this Act, issue binding and
advance decision and ruling
at the request of an
interested party on matters
pertaining to importation or
exportation of goods.
Upon written request of the
interested party, the Bureau
shall notify the party of its
decision in writing within the
period specified in this Act or
by regulation. Should the
decision be adverse to the
requesting interested party,
the reasons thereof shall be
indicated and the party shall
be advised of the party's right
of appeal.
The ruling and decision shall
be issued by the Bureau
within thirty (30) days from
the submission of the
such privilege shall be
accorded under special
agreements between the
Philippines and the countries
which they represent: And
Provided, further, That the
privilege may be granted only
upon specific instructions of
the Department of Finance in
each instance which will be
issued only upon request of
the Department of Foreign
Affairs.
p. Regalia, gems, statuary,
specimens or casts of
sculptures imported for the
bona fide use and by the
order of any society
incorporated or established
solely for religious,
philosophical, educational,
scientific or literary purposes,
or for the encouragement of
the fine arts, or for the use
and by the order of any
institution of learning, public
library, museum, orphan
asylum or hospital, and not
for barter, sale or hire:
Provided, That the term
"regalia" shall be held to
embrace only such insignia of
rank or office or emblems as
may be worn upon the
person or borne in the hand
during public exercises or
ceremonies of the society or
institution, and shall not
include articles of furniture or
fixtures, or ordinary wearing
duly registered relief
organization, not operated for
profit, for free distribution
among the needy, upon
certification by the
Department of Social
Services and Development or
the Department of Education,
Culture and Sports, as the
case may be;
m. Containers, holders and
other similar receptacles of
any material including kraft
paper bags for locally
manufactured cement for
export, including corrugated
boxes for bananas, mangoes,
pineapples and other fresh
fruits for export, except other
containers made of paper,
paperboard and textile
fabrics, which are of such
character as to be readily
identifiable and/or reusable
for shipment or transportation
of goods shall be delivered to
the importer thereof upon
identification, examination
and appraisal and the giving
of a bond in an amount equal
to one and one-half times the
ascertained duties, taxes and
other charges within six (6)
months from the date of
acceptance of the import
entry;
n. Supplies which are
necessary for the reasonable
requirements of the vessel or
aircraft in hervoyage or flight
necessary documents and
information.
Sec. 114. Right of Appeal,
Forms and Ground. – Any
party adversely affected by a
decision or omission of the
Bureau pertaining to an
importation, exportation, or
any other legal claim shall
have the right to appeal
within fifteen (15) days from
receipt of the questioned
decision or order.
An appeal in writing shall be
filed within the period
prescribed in this Act or by
regulation and shall specify
the grounds thereof.
The Bureau may allow a
reasonable time for the
submission of supporting
evidence to the appeal.
CHAPTER 3
TYPES OF IMPORTATION
Sec. 115. Treatment of
Importation. – Imported
goods shall be deemed
"entered" in the Philippines
for consumption when the
goods declaration is
electronically lodged,
together with any required
supporting documents, with
the pertinent customs office.
apparel, nor personal
property of individuals.
q. Musical organs imported
for the bona fide use and by
the owner of any society
incorporated or established
for religious or educational
purposes, or, expressly for
presentation thereto.
r. Scientific apparatus,
instruments and utensils
specially imported for the
bona fide use and by the
order of any society or
institution incorporated or
established solely for
educational, scientific, or
charitable purposes, or for
the encouragement of the
fine arts, or for the bona fide
use and by the order of any
institution of learning in the
Philippines, and not for
barter, sale or hire.
s. Philosophical, historical, foreign vessel or her
economic, scientific, technical equipment, wrecked,
and vocational books
specially imported for the
bona fide use and by the
order of any society or
institution, incorporated or
established solely for
philosophical, educational,
scientific, charitable or literary
purposes, or for the
encouragement of the fine
arts, or for the bona fide use
of and by the order of any
institution of learning in the
outside the Philippines,
including articles transferred
from a bonded warehouse in
any collection district to any
vessel or aircraft engaged in
foreign trade, for use or
consumption of the
passengers or its crew on
board such vessel or aircrafts
as sea or air stores; or
articles purchased abroad for
sale on board a vessel or
aircraft as saloon stores or air
store supplies: Provided,
That any surplus or excess of
such vessel or aircraft
supplies arriving from foreign
ports or airports shall be
dutiable;
o. Articles and salvage
from vessels recovered after
a period of two (2) years from
the date of filing the marine
protest or the time when the
vessel was wrecked or
abandoned, or parts of a
abandoned in Philippine
waters or elsewhere:
Provided, That articles and
salvage recovered within the
said period oftwo (2) years
shall be dutiable;
p. Coffins or urns
containing human remains,
bones or ashes, used
personal and household
effects (not merchandise) of
the deceased person, except
Sec. 116. Free Importation
and Exportation. – Unless
otherwise provided by law or
regulation, all goods may be
freely imported into and
exported from the Philippines
without need for import and
export permits, clearances or
licenses.
Sec. 117. Regulated
Importation and Exportation.
– Goods which are subject to
regulation shall be imported
or exported only after
securing the necessary
goods declaration or export
declaration, clearances,
licenses, and any other
requirements, prior to
importation or exportation. In
case of importation,
submission of requirements
after arrival of the goods but
prior to release from customs
custody shall be allowed but
only in cases provided for by
governing laws or
regulations.
Sec. 118. Prohibited
Importation and Exportation.
– The importation and
exportation of the following
goods are prohibited:
(a) Written or printed goods
in any form containing any
matter advocating or inciting
treason, rebellion,
insurrection, sedition against
the government of the
Philippines: Provided, That
the provisions of this
subsection shall apply to
books not exceeding two
copies of any one work when
imported by any individual for
his own use, and not for
barter, sale or hire.
Bibles, missals,
prayerbooks, koran, ahadith
and other religious books of
similar nature and extracts
therefrom, hymnal and
hymns for religious uses,
specially prepared books,
music and other instrumental
aids for the deaf, mute or
blind, and textbooks
prescribed for use in any
school in the Philippines:
Provided, That complete
books published in parts in
periodical form shall not be
classified herein.
t. Newsprint, whenever
imported by or for publishers
for the exclusive use in the
publication of newspapers.
u. Articles donated to
public or private institutions
established solely for
educational, scientific,
cultural, charitable, health,
relief, philanthropic or
religious purposes, for free
distribution among, or
exclusive use of, the needy.
vehicles, the value of which
does not exceed ten
thousand pesos
(P10,000.00), upon
identification as such;
q. Samples of the kind, in
such quantity and of such
dimension or construction as
to render them unsalable or
of no appreciable commercial
value; models not adapted for
practical use; and samples of
medicines, properly marked
"sample-sale punishable by
law," for the purpose of
introducing a new article in
the Philippine market and
imported only once in a
quantity sufficient for such
purpose by a person duly
registered and identified to be
engaged in that trade:
Provided, That importations
under this subsection shall be
previously authorized by the
Secretary of Finance:
Provided, however, That
importation of sample
medicine shall be previously
authorized by the Secretary
of Health that such samples
are new medicines not
available in the Philippines:
Provided, finally, That
samples not previously
authorized and/or properly
marked in accordance with
this section shall be levied
the corresponding tariff duty.
Philippines, or forcible
resistance to any law of the
Philippines, or written or
printed goods containing any
threat to take the life of, or
inflict bodily harm up on any
person in the Philippines;
(b) Goods, instruments,
drugs and substances
designed, intended or
adapted for producing
unlawful abortion, or any
printed matter which
advertises, describes or gives
direct or indirect information
where, how or by whom
unlawful abortion is
committed;
(c) Written or printed goods,
negatives or cinematographic
films, photographs,
engravings, lithographs,
objects, paintings, drawings
or other representation of an
obscene or immoral
character;
(d) Any goods manufactured
in whole or in part of gold,
silver or other precious
metals or alloys and the
stamp, brand or mark does
not indicate the actual
fineness of quality of the
metals or alloys;
(e) Any adulterated or
misbranded food or goods for
human consumption or any
adulterated or misbranded
 v. Food, clothing, house-
building and sanitary-
construction materials, and
medical, surgical and other
supplies for use in
emergency relief work, when
imported by or directly for the
account of any victim,
sufferer, refugee, survivor or
any other person affected
thereby, or by or for the
account of any relief
organization, not operated for
profit, for distribution among
the distressed individuals,
whenever the President shall,
by proclamation, declare an
emergency to exist by reason
of a state of war, pestilence,
cholera, plague, famine,
drought, typhoon,
earthquake, fire, flood and
similar conditions: Provided,
That the importation free of
duty of articles described in
this herein subsection shall
continue only during the
existence of such
emergency, or within such
limits and subject to such
conditions as the President
may, by his proclamation,
deem necessary to meet the
emergency.
w. Philippine articles
previously exported from the
Philippines and returned
without having been
advanced in value or
improved in condition by any
process of manufacture or
Commercial samples,
except those that are not
readily and easily identifiable
(e.g., precious and semi-
precious stones, cut or uncut,
and jewelry set with precious
stones), the value of any
single importation of which
does not exceed ten
thousand pesos (P10,000.00)
upon the giving of a bond in
an amount equal to twice the
ascertained duties, taxes and
other charges thereon,
conditioned for the
exportation of said samples
within six (6) months from the
date of the acceptance of the
import entry or in default
thereof, the payment of the
corresponding duties, taxes
and other charges. If the
value of any single
consignment of such
commercial samples exceeds
ten thousand pesos
(P10,000.00),the importer
thereof may select any
portion of same not
exceeding in value of ten
thousand pesos (P10,000.00)
for entry under the provision
of this subsection, and the
excess of the consignment
may be entered in bond, or
for consumption, as the
importer may elect;
r. Animals (except race
horses), and plants for
scientific, experimental,
propagation, botanical,
drug in violation of relevant
laws and regulations;
(f) Infringing goods as
defined under the Intellectual
Property Code and related
laws; and
(g) All otter goods or parts
thereof which importation and
exportation are explicitly
prohibited by law or rules and
regulations issued by the
competent authority.
Sec. 119. Restricted
Importation and Exportation.
– Except when authorized by
law or regulation, the
importation and exportation
of the following restricted
goods are prohibited:
(a) Dynamite, gunpowder,
ammunitions and other
explosives, firearms and
weapons of war, or parts
thereof;
(b) Roulette wheels,
gambling outfits, loaded dice,
marked cards, machines,
apparatus or mechanical
devices used in gambling or
the distribution of money,
cigars, cigarettes or other
goods when such distribution
is dependent on chance,
including jackpot and pinball
machines or similar
contrivances, or parts
thereof; (c) Lottery and
other means, and upon which
no drawback or bounty has
been allowed, and foreign
articles when returned after
having been loaned and
exported for use temporarily
abroad solely for exhibition,
examination or
experimentation, for scientific
or educational purposes, and
foreign containers packed
with exported Philippine
articles and returned empty if
imported by or for the
account of the person or
institution who exported them
from the Philippines and not
for sale, subject to
identification: Provided, That
any Philippine article falling
under this subsection upon
which drawback or bounty
has been allowed shall, upon
re-importation thereof, be
subject to a duty under this
subsection equal to the
amount of such drawback or
bounty.
x. Large containers (e.g.,
demijohns, cylinders, drums,
casks and other similar
receptacles of metal, glass or
other material) which are, in
the opinion of the Collector of
Customs, of such a character
as to be readily identifiable
may be delivered to the
importer thereof upon
identification and the giving of
a bond in an amount equal to
one and one-half times the
breeding, zoological and
national defense purposes:
Provided, That no live trees,
shoots, plants, moss, and
bulbs, tubers and seeds for
propagation purposes may
be imported under this
section, except by order of
the Government or other duly
authorized institutions:
Provided, further, That the
free entry of animals for
breeding purposes shall be
restricted to animals of
recognized breed, duly
registered in the book of
record established for that
breed, certified as such by
the Bureau of Animal
Industry: Provided,
furthermore, That certificate
of such record, and pedigree
of such animal duly
authenticated by the proper
custodian of such book of
record, shall be produced
and submitted to the
Collector of Customs,
together with affidavit of the
owner or importer, that such
animal is the animal
described in said certificate of
record and pedigree: And
Provided, finally, That the
animals and plants are
certified by the National
Economic and Development
Authority as necessary for
economic development;
s. Economic, technical,
vocational, scientific,
sweepstakes tickets, except
advertisements thereof and
lists of drawings therein;
(d) Marijuana, opium,
poppies, coca leaves, heroin
or other narcotics or synthetic
drugs which are or may
hereafter be declared habit
forming by the President of
the Philippines, or any
compound, manufactured
salt, derivative, or preparation
thereof, except when
imported by the government
of the Philippines or any
person duly authorized by the
Dangerous Drugs Board, for
medicinal purposes;
(e) Opium pipes or parts
thereof, of whatever material;
and
(f) Any other goods whose
importation and exportation
are restricted.
The restriction to import or
export the above stated
goods shall include the
restriction on their transit.
CHAPTER 4
RELIEF CONSIGNMENT
Sec. 120. Relief
Consignment. – Goods such
as food, medicine, equipment
and materials for shelter,
donated or leased to
ascertained duties, taxes and philosophical, historical, and government institutions and
other charges thereon, cultural books and/or accredited private entities for
conditioned for the publications: Provided, That free distribution to or use of
exportation thereof on those which may have victims of calamities shall be
payment of the already been imported but treated and entered as relief
corresponding duties, taxes pending release by the consignment.
and other charges within one Bureau of Customs at the
year from the date of effectivity of this Decree may Upon declaration of a state of
acceptance of the import still enjoy the privilege herein calamity, clearance of relief
entry. provided upon certification by consignment shall be a
the Department of Education, matter of priority and subject
y. Supplies or ship stores Culture and Sports that such to a simplified customs
listed as such for the use of imported books and/or procedure. The Bureau shall
the vessel; supplies which publications are for provide for:
are intended for the economic, technical,
reasonable requirements of vocational, scientific, (a) Lodging of a simplified
the vessel in her voyage philosophical, historical or goods declaration or of a
outside the Philippines, cultural purposes or that the provisional or incomplete
including such articles same are educational, goods declaration subject to
transferred from a bonded scientific or cultural materials completion of the declaration
warehouse in any collection covered by the International within a specified period;
district to any vessel engaged Agreement on Importation of
in foreign trade, for use or Educational Scientific and (b) Lodging, registering and
consumption of the Cultural Materials signed by checking of the goods
passengers or its crew on the President of the declaration and supporting
board such vessel as sea Philippines on August 2, documents prior to the arrival
stores; or articles purchased 1952, or other agreements of the goods, and their
abroad for sale on board a binding upon the Philippines. release upon arrival;
vessel as saloon stores or
supplies: Provided, That any Educational, scientific and (c) Clearance beyond the
surplus or excess of such cultural materials covered by designated hours of business
ship, sea or saloon stores international agreements or or away from customs offices
arriving from foreign ports commitments binding upon and waiver of any
shall be dutiable according to the Philippine Government so corresponding charges; and
the corresponding heading or certified by the Department of
subheading. Education, Culture and (d) Examination and/or
Sports. sampling of goods only in
z. Articles and salvage exceptional circumstances.
from vessels recovered after Bibles, missals, prayer
the period of two years from books, Koran, Ahadith and The Department of Finance
the date of filing the marine other religious books of (DOF) and the Department of
protest or the time when the similar nature and extracts Social Welfare and
vessel was wrecked or
abandoned as determined by
the Collector of Customs, or
such part of Philippine vessel
or her equipment, wrecked or
abandoned in Philippine
waters or elsewhere:
Provided, That articles and
salvage recovered within the
said period of two years shall
be dutiable according to the
corresponding heading or
subheading.
aa. Articles of easy
identification exported from
the Philippines for repairs
abroad and subsequently
reimported: Provided, That
the cost of the repairs made
to any such article shall pay a
rate of duty of twenty-five per
cent ad valorem.
bb. Coffins or urns
containing human remains,
bones or ashes, and all
articles for ornamenting said
coffins or urns and
accompanying same; used
personal and household
effects, not merchandise, of
deceased persons, upon
identification as such,
satisfactory to the Collector of
Customs.
Sec. 106. Drawbacks: a. On
Fuel Used for Propulsion of
Vessels. — On all fuel
imported into the Philippines
which is afterwards used for
the propulsion of vessels of
therefrom, hymnal and
hymns for religious uses;
t. Philippine articles
previously exported from the
Philippines and returned
without having been
advanced in value or
improved in condition by any
process of manufacture or
other means, and upon which
no drawback or bounty has
been allowed, including
instruments and implements,
tools of trade, machinery and
equipment, used abroad by
Filipino citizens in the pursuit
of their business, occupation
or profession; and foreign
articles previously imported
when returned after having
been exported and loaned for
use temporarily abroad solely
for exhibition, testing and
experimentation, for scientific
or educational purposes; and
foreign containers previously
imported which have been
used in packing exported
Philippine articles and
returned empty if imported by
or for the account of the
person or institution who
exported them from the
Philippines and not for sale,
barter or hire subject to
identification: Provided, That
any Philippine article falling
under this subsection upon
which drawback or bounty
has been allowed shall, upon
re-importation thereof, be
Development (DSWD) shall
jointly issue the rules and
regulations for the
implementation of tins
provision.
Sec. 121. Duty and Tax
Treatment. – Relief
consignment, as defined in
Section 120, imported during
a state of calamity and
intended for a specific
calamity area for the use of
the calamity victims therein,
shall be exempt from duties
and taxes.
TITLE II
BUREAU OF CUSTOMS
CHAPTER 1
GENERAL
ADMINISTRATION
Sec. 200. Chief Officials of
the Bureau. – The Bureau
shall be headed by a
Commissioner and shall be
assisted by at least four (4)
but not more than six (6)
Deputy Commissioners.
The Commissioner shall be
appointed by the President of
the Philippines.
The Deputy Commissioners
shall also be appointed by
the President and at least
Philippine registry engaged in
trade with foreign countries,
or in the coastwise trade, a
refund shall be allowed equal
to the duty imposed by law
upon such fuel, less one per
cent thereof, which shall be
paid under such rules and
regulations as may be
prescribed by the
Commissioner of Customs
with the approval of the
department head.
. under Congressional
b. On Articles Made from
Imported Materials or Similar
Domestic Materials and
Wastes Thereof— Upon the
exportation of articles
manufactured or produced in
the Philippines, including the
packing, covering, putting up,
marking or labeling thereof,
either in whole or in part of
imported materials, or from
similar domestic materials of
equal quantity and productive
manufacturing quality and
value, such question to be
determined by the Collector
of Customs, there shall be
allowed a drawback equal in
amount to the duties paid on
the imported materials so
used, or where similar
domestic materials are used,
to the duties paid on the
equivalent imported similar
materials, less one per cent
thereof: Provided, That the
exportation shall be made
within three years after the
subject to a duty under this
subsection equal to the
amount of such drawback or
bounty.
u. Aircraft, equipment and
machinery, spare parts
commissary and catering
supplies, aviation gas, fuel
and oil, whether crude or
refined, and such other
articles or supplies imported
by and for the use of
scheduled airlines operating
franchise: Provided, That
such articles or supplies are
not locally available in
reasonable quantity, quality
and price and are necessary
or incidental for the proper
operation of the scheduled
airline importing the same;
v. Machineries, equipment,
tools for production, plants to
convert mineral ores into
saleable form, spare parts,
supplies, materials,
accessories, explosives,
chemicals, and transportation
and communication facilities
imported by and for the use
of new mines and old mines
which resume operations,
when certified to as such by
the Secretary of Agriculture
and Natural Resources upon
the recommendation of the
Director of Mines, for a period
ending five (5) years from the
first date of actual
commercial production of
majority of whom shall come
from the ranks of the Bureau.
Sec. 201. Powers and
Functions of the
Commissioner. – The
Commissioner shall have the
following powers and
functions:
(a) Exclusive and original
jurisdiction, to interpret the
provisions of this Act, in
collaboration with other
relevant government
agencies, subject to review
by the Secretary of Finance;
(b) Exercise any customs
power, duties and functions,
directly or indirectly;
(c) Review any action or
decision of any customs
officer performed pursuant to
the provisions of this Act;
(d) Review and decide
disputed assessments and
other matters related thereto,
subject to review by the
Secretary of Finance and
exclusive appellate
jurisdiction of the Court of
Tax Appeals (CTA);
(e) Delegate the powers
vested under this Act to any
customs officer with the rank
equivalent to division chief or
higher, except for the
importation of the foreign
material used or constituting
the basis for drawback: And
Provided, further, That when
the articles exported or
coverings thereof are in part
of materials grown or
produced in the Philippines
not entitled to drawback
under this section, the
imported materials, or the
similar domestic materials of
equal quantity and productive
manufacturing quality and
value entitled to drawback,
shall so appear in the
completed articles or
packages that the quantity or
measure thereof may be
ascertained: And Provided,
finally, That the imported
materials, or the similar
domestic materials entitled to
drawback under this section
for which drawback is
claimed, shall be identified;
that the quantity of such
materials used and the
amount of duty paid thereon
or, if the domestic materials,
paid upon its equivalent, shall
be ascertained; and that the
fact of their exportation shall
be established; and the
refund if made shall be paid
to the manufacturer,
producer, or exporter, or to
the duly authorized agent of
any of them, under and in
accordance with such rules
and regulations as the
Commissioner of Customs
saleable mineral products:
Provided, That such articles
are not locally available in
reasonable quantity, quality
and price and are necessary
or incidental in the proper
operation of the mine; and
aircrafts imported by agro-
industrial companies to be
used by them in their
agriculture and industrial
operations or activities, spare
parts and accessories
thereof;
w. Spare parts of vessels
or aircraft of foreign registry
engaged in foreign trade
when brought into the
Philippine exclusively as
replacements or for the
emergency repair thereof,
upon proof satisfactory to the
Collector of Customs that
such spare parts shall be
utilized to secure the safety,
seaworthiness or
airworthiness of the vessel or
aircraft, to enable it to
continue its voyage or flight;
x. Articles of easy
identification exported from
the Philippines for repair and
subsequently reimported
upon proof satisfactory to the
Collector of Customs that
such articles are not capable
of being repaired locally:
Provided, That the cost of the
repairs made to any such
following powers and
functions:
(1) Promulgation of rules and
regulations;
(2) Issuance, revocation or
modification of rulings; and
(3) Compromise or abate of
customs obligations.
(f) Assignment or
reassignment of any customs
officer subject to the approval
of the Secretary of Finance:
Provided, That District
Collectors and other customs
officers that perform
assessment functions shall
not remain in the same area
of assignment for more than
three (3) years; and
(g) Perform all other duties
and functions as may be
necessary for the effective
implementation of this Act
and other customs related
laws.
Sec. 202. Functions of the
Bureau. – The Bureau shall
exercise the following duties
and functions:
(a) Assessment and
collection of customs
revenues from imported
goods and other dues, fees,
charges, fines and penalties
accruing under this Act;
shall prescribe with the article shall pay a rate of duty
approval of the department of thirty per cent ad valorem;
head.
y. Trailer chassis when
imported by shipping
companies for their exclusive
use inhandling containerized
cargo, upon posting a bond in
an amount equal to one and
one-half times the
ascertained duties, taxes and
other charges due thereon to
cover a period of one year
from the date of acceptance
of the entry, which period for
meritorious reasons may be
extended by the
Commissioner of Customs
from year to year, subject to
the following conditions:
1. That they shall be
properly identified and
registered with the Land
Transportation Commission;
2. That they shall be
subject to customs
supervision fee to be fixed by
the Collector of Customs and
subject to the approval of the
Commissioner of Customs;
3. That they shall be
deposited in the Customs
zone when not in use; and
4. That upon the
expiration of the period
prescribed above, duties and
(b) Simplification and
harmonization of customs
procedures to facilitate
movement of goods in
international trade;
(c) Border control to prevent
entry of smuggled goods;
(d) Prevention and
suppression of smuggling
and other customs fraud;
(e) Facilitation and security of
international trade and
commerce through an
informed compliance
program
(f) Supervision and control
over the entrance and
clearance of vessels and
aircraft engaged in foreign
commerce;
(g) Supervision and control
over the handling of foreign
mails arriving in the
Philippines for the purpose of
collecting revenues and
preventing the entry of
contraband;
(h) Supervision and control
on all import and export
cargoes, landed or stored in
piers, airports, terminal
facilities, including container
yards and freight stations for
the protection of government
taxes shall be paid, unless
otherwise re-exported.
The provisions of Sec. 105 of
Presidential Decree No. 34,
dated October 27, 1972, to
the contrary notwithstanding
any officer or employee of the
Department of Foreign
Affairs, including any attache,
civil or military, or member of
his staff assigned to a
Philippine diplomatic mission
abroad by his Department or
any similar officer or
employee assigned to a
Philippine consular office
abroad, or any personnel of
the Reparations Mission in
Tokyo or AFP military
personnel detailed with
SEATO or any AFP military
personnel accorded
assimilated diplomatic rank
on duty abroad who is
returning from a regular
assignment abroad, for
reassignment to his Home
office, or who dies, resigns,
or is retired from the service,
after the approval of this
Decree, shall be exempt from
the payment of all duties and
taxes on his personal and
household effects, including
one motor car which must
have been ordered or
purchased prior to the receipt
by the mission or consulate
of his order of recall, and
which must be registered in
his name: Provided, however,
revenue and prevention of
entry of contraband;
(i) Conduct a compensation
study with the end view of
developing and
recommending to the
President a competitive
compensation and
remuneration system to
attract and retain highly
qualified personnel, while
ensuring that the Bureau
remains financially sound and
sustainable;
(j) Exercise of exclusive
original jurisdiction over
forfeiture cases under this
Act; and
(k) Enforcement of this Act
and all other laws, rules and
regulations related to
customs administration.
Sec. 203. Annual Report of
the Commissioner. – The
Commissioner shall submit to
the President, the Congress
of the Philippines and the
NEDA an annual report on
the performance of the
Bureau, on or before March
31 of the following year.
Sec. 204. Promulgation of
Rules and Regulations. – The
Commissioner, subject to the
approval of the Secretary of
Finance, shall promulgate
rules and regulations for the
That this exemption shall
apply only to the value of the
motor car and to aggregate
assessed value of said
personal and household
effects the latter not to
exceed thirty per centum
(30%) of the total amount
received by such officer or
employee in salary and
allowances during his latest
assignment abroad but not to
exceed four years; And
Provided, finally, That the
officer or employee
concerned must have served
abroad for not less than two
years.
The provisions of general and
special laws, including those
granting franchises, to the
contrary notwithstanding,
there shall be no exemptions
whatsoever from the payment
of customs duties except
those provided for in this
Code; those granted to
government agencies,
instrumentalities or
government-owned or
controlled corporations with
existing contracts,
commitments, agreements,
or obligations (requiring such
exemption) with foreign
countries; international
institutions, associations or
organizations entitled to
exemption pursuant to
agreements or special laws;
and those that may be
granted by the President
enforcement of this Act. The
Commissioner shall regularly
prepare and publish an
updated customs manual,
and the rules, regulations and
decisions of the Bureau. The
Commissioner shall furnish
the Congress of the
Philippines, the NEDA and
the Tariff Commission with
electronic copies of
department orders,
administrative orders,
circulars, and rules and
regulations promulgated
pursuant to this Act.
Sec. 205. Copies of Goods
Declaration. – The
Commissioner shall regularly
furnish the NEDA, the
Philippine Statistics Authority
(PSA), the Bureau of Internal
Revenue (BIR.) and the Tariff
Commission electronic
copies of all customs goods
declaration processed and
cleared by the Bureau.
Upon request, the Tariff
Commission shall have
access to, and the right to be
furnished with copies of
liquidated goods declaration
and other documents
supporting the goods
declaration as finally filed in
the Commission on Audit
(COA).
For this purpose, the Bureau
shall maintain electronic
upon prior recommendation
of the National Economic and
Development Authority in the
interest of national economic
development.
Sec. 106. Drawbacks. — a.
On Fuel Used for Propulsion
of Vessels. — On all fuel
imported into the Philippines
used for propulsion of
vessels engaged in trade with
foreign countries, or in the
coastwise trade, a refund or
tax credit shall be allowed not
exceeding ninety-nine (99)
per cent of the duty imposed
by law upon such fuel, which
shall be paid or credited
under such rules and
regulations as may be
prescribed by the
Commissioner of Customs
with the approval of the
Secretary of Finance.
b. On Petroleum Oils and
Oils Obtained from
Bituminous Minerals, Crude
Eventually Used for
Generation of Electric Power
and for the Manufacture of
City Gas. — On petroleum
oils and oils obtained from
bituminous materials, crude
oils imported by non-electric
utilities, sold directly or
indirectly, in the same form or
after processing, to electric
utilities for the generation of
electric power and for the
manufacture of city gas, a
refund or tax credit shall be
records of goods declaration
and other documents
supporting the declaration.
CHAPTER 2
CUSTOMS DISTRICTS AND
PORTS OF ENTRY
Sec. 206. Customs Districts.
– For administrative
purposes, the Philippines
shall be divided into as many
Customs Districts as
necessary, the respective
limits of which may be
changed from time to time by
the Commissioner, with the
approval of the Secretary of
Finance.
Each Customs District shall
be supervised by one (1)
District Collector, assisted by
as many Deputy District
Collectors as may be
necessary. The choice of the
location of a District Office, its
business hours and the
staffing pattern thereof, shall
be based on the particular
requirements of each district.
Sec. 207. Ports of Entry. – All
ports of entry shall be under
the supervision and control of
a Customs District. A District
Collector shall be assigned in
the principal ports of entry
while a Deputy District
Collector may be assigned to
other types of ports of entry.
allowed not exceeding fifty
per cent (50%) of the duty
imposed by law upon such
oils, which shall be paid or
credited under such rules and
regulations as may be
prescribed by the
Commissioner of Customs
with the approval of the
Secretary of Finance.
c. On Articles Made from
Imported Materials. — Upon
exportation of articles
manufactured or produced in
the Philippines, including the
packing, covering, putting up,
marking or labeling thereof
either in whole or in part of
imported materials for which
duties have been paid, refund
or tax credit shall be allowed
for the duties paid on the
imported materials do used
including the packing,
covering, putting up, marking
or labeling thereof, subject to
the following conditions:
1. The actual use of the
imported materials in the
production or manufacture of
the article exported with their
quantity, value, and amount
of duties paid thereon, having
been established;
2. The duties refunded or
credited shall not exceed one
hundred (100) per cent of
duties paid on imported
materials used;
The principal ports of entry
shall be located in Aparri,
San Fernando, Manila,
Manila International
Container Port, Ninoy Aquino
International Airport, Subic,
Clark, Batangas, Legaspi,
Iloilo, Cebu, Tacloban,
Surigao, Cagayan de Oro,
Zamboanga, Davao, Limay
and such other ports that
may be created pursuant to
this Act.
For the effective enforcement
of the Bureau's functions and
without hampering business
and commercial operations of
the ports, sea ports and
airport authorities and private
ports and airport operators
shall provide suitable areas
for examination and for other
customs equipment free of
charge within, a definite
period of time, as agreed with
private port and airport
operations, if any.
Sec. 208. Power of the
President to Open and Close
Any Port. – Upon the
recommendation of the
Secretary of Finance, the
President may open or close
any port of entry. Upon
closure of a port of entry, the
existing personnel shall he
reassigned by the
Commissioner, subject to the
 3. There is no
determination by the National
Economic and Development
Authority of the requirement
for certification on non-
availability of locally-
produced or manufactured
competitive substitutes for
the imported materials used
at the time of importation;
4. The exportation shall be
made within one (1) year
after the importation of
materials used and claim of
refund or tax credit shall be
filed within six (6) months
from the date of exportation;
5. When two or more
products result from the use
of the same imported
materials, an apportionment
shall be made on its
equitable basis.
For every application of a
drawback, there shall be paid
to and collected by the
Bureau of Customs as filing,
processing and supervision
fees the sum of Five Hundred
Pesos (P500.00) which
amount may be increased or
decreased when the need
arises by the Secretary of
Finance upon the
recommendation of the
Commissioner of Customs.
d. Payment of Partial
Drawbacks. — The Secretary
approval of the Secretary of
Finance,
Sec. 209. Assignment of
Customs Officers and
Employees to Other Duties. –
The Commissioner, with the
approval of the Secretary of
Finance, may assign any
employee of the Bureau to
any port, service, division or
office of the Bureau within the
Bureau's staffing pattern or
organizational structure, or
may assign any employee
other duties: Provided, That
such assignment shall not
affect the employee's tenure
of office nor result in a
change of status, demotion in
rank and/or salary deduction.
Sec. 210. Duties of the
District Collector. – The
District Collector shall have
the following duties in their
assigned Customs District:
(1) Ensure entry of all
imported goods at the
customs office;
(2) Prevent importation and
exportation of prohibited
goods;
(3) Ensure legal compliance
of regulated goods and
facilitate the flow of legitimate
trade;
of Finance may, upon
recommendation of the
Commissioner of Customs,
promulgate rules and
regulations allowing partial
payments of drawbacks
under this section.
e. Payment of the
Drawbacks. — Claims for
refund or tax credit eligible for
such benefits shall be paid or
granted by the Bureau of
Customs to claimants within
sixty (60) days after receipt of
properly accomplished
claims: Provided, That a
registered enterprise under
Republic Act Numbered Fifty-
one hundred and eighty-six
or Republic Act Numbered
Sixty-one hundred and thirty-
five which has previously
enjoyed tax credit based on
customs duties paid on
imported raw materials and
supplies, shall not be entitled
to drawback under this
section, with respect to the
same importation
subsequently processed and
re-exported; Provided,
further, That is as a result of
the refund or tax credit by
way of drawback of customs
duties, there would
necessarily result a
corresponding refund or
credit of internal revenue
taxes on the same
importation, the Collector of
Customs shall likewise certify
the same to the
(4) Examine, classify and
value imported goods;
(5) Assess and collect duties,
taxes and other charges on
imported goods;
(6) Hold and dispose
imported goods in
accordance with this Act;
(7) Prevent smuggling and
other customs fraud; and
(8) Perform other necessary
duties that may be assigned
by the Commissioner for the
effective implementation of
this Act.
Subject to the supervision
and control of the District
Collector, the duties and
functions of the District
Collector may be delegated
to the Deputy District
Collector. The Deputy District
Collector assigned to a sub-
port shall be under the
supervision and control of the
District Collector of the
corresponding principal port.
Sec. 211. Temporary
Succession of Deputy District
Collector to Position of Acting
District Collector. – In the
absence or disability of a
District Collector or, in case
of vacancy, the Deputy
District Collector shall
temporarily discharge the
 Commissioner of Customs
who shall cause the said
refund or tax credit of internal
revenue taxes to be paid,
refunded or credited in favor
of the importer, with advice to
the Commissioner of Internal
Revenue.
TITLE II
ADMINISTRATIVE
PROVISIONS
TITLE II
ADMINISTRATIVE PART I
PROVISIONS BASES OF ASSESSMENT
OF DUTY
PART 1
BASES OF ASSESSMENT
OF DUTY Sec. 201. — Basis of
Dutiable Value. — The
. dutiable value of an imported
Sec. 201. Basis of Dutiable article subject to an ad
Value. — Whenever an valorem rate of duty shall be
imported article is subject to based on the cost (fair
an ad valorem rate of duty, market value) of same, like or
the duty shall be assessed similar articles, as bought
upon the market value or and sold or offered for sale
price at which, at the time of freely in the usual wholesale
exportation, the same, like or quantities in the ordinary
similar article is freely offered course of trade in the
for sale in the principal principal markets of the
markets of the exporting exporting country on the date
country for exportation to the of exportation to the
Philippines, in the usual Philippines (excluding
wholesale quantities and in internal excise taxes to be
the ordinary course of trade remitted or rebated) or where
(excluding internal excise there is none on such date,
taxes to be remitted or then on the cost (fair market
rebated), plus ordinary value) nearest to the date of
expenses prior and incidental exportation, including the
Sec. 201.Basis of Dutiable
Value. - (A) Method One.
Transaction Value. - The
dutiable value of an imported
article subject to an ad
valorem rate of duty shall be
the transaction value, which
shall be the price actually
paid or payable for the goods
when sold for export to the
Philippines, adjusted by
adding:
(1) The following to the
extent that they are incurred
by the buyer but are not
included in the price actually
paid or payable for the
imported goods:
(a) Commissions and
brokerage fees (except
buying commissions);
(b) Cost of containers;
(c) The cost of packing,
whether for labour or
materials;
(d) The value,
apportioned as appropriate,
of the following goods and
services: materials,
components, parts and
similar items incorporated in
the imported goods; tools;
duties of the District
Collector. Should there be no
Deputy District Collector, the
District Collector shall
designate, in writing, a senior
ranking customs officer to
temporarily perform the
duties of the District
Collector. In case there are
two (2) or more senior
ranking customs officers with
equal length of service, a
drawing of lots shall be
undertaken. The District
Collector shall report the
designation to the
Commissioner within twenty-
four (24) hours after the
designation.
Sec. 212. Records to be Kept
by Customs Officers. –
District Collectors, Deputy
District Collectors, and
customs officers acting in
such capacities must
maintain permanent records
of official transactions and
turn-over all records and
official papers to their
respective successors or
other authorized officials.
The records shall be made
available for inspection by
other authorized officials of
the Bureau.
If required, the District
Collector shall affix the official
dry seal of the Bureau on all
documents and records
requiring authentication.
to the lading of such article
on board the vessel or
aircraft at the port of export
(including taxes or duties, if
any) and freight paid as well
as insurance premium paid
covering the transportation of
such article to the port of
entry in the Philippines.
. the transportation of such
When the value of the article
cannot be ascertained in
accordance with the
preceding paragraph, the
value shall be the domestic
wholesale market value or
selling price of the same, like
or similar imported article in
the principal market of the
Philippines on the date of
exportation of the article
under appraisement, in the
usual wholesale quantities
and in the ordinary course of
trade, minus the import duty
and other taxes as well as a
commission not exceeding
six per centum if any has
been paid or contracted to be
paid on goods secured
otherwise than by purchase,
and profits not to exceed
eight per centum and a
reasonable allowance for
general expenses not to
exceed eight per centum on
purchased goods, and all
other expenses incidental to
the delivery from the port of
importation to the principal
market in the Philippines.
value of all container,
covering and/or packings of
any kind and all other
expenses, costs and charges
incident to placing the article
in a condition ready for
shipment to the Philippines,
and freight as well as
insurance premium covering
articles to the port of entry in
the Philippines.
Where the fair market value
or price of the article cannot
be ascertained thereat or
where there exists a
reasonable doubt as to the
fairness of such value or
price, then the fair market
value or price in the principal
market in the country of
manufacture or origin, if it is
not the country of
exportation, or in a third
country with the same stage
of economic development as
the country of exportation
shall be used.
When the dutiable value of
the article cannot be
ascertained in accordance
with the preceding
paragraphs or where there
exists a reasonable doubt as
to the cost (fair market value)
of the imported article
dies; moulds and similar
items used in the production
of imported goods; materials
consumed in the production
of the imported goods; and
engineering, development,
artwork, design work and
plans and sketches
undertaken elsewhere than in
the Philippines and
necessary for the production
of imported goods, where
such goods and services are
supplied directly or indirectly
by the buyer free of charge or
at a reduced cost for use in
connection with the
production and sale for
export of the imported goods;
(e) The amount of
royalties and license fees
related to the goods being
valued that the buyer must
pay, either directly or
indirectly, as a condition of
sale of the goods to the
buyer;
(2) The value of any part of
the proceeds of any
subsequent resale, disposal
or use of the imported goods
that accrues directly or
indirectly to the seller;
(3) The cost of transport of
the imported goods from the
port of exportation to the port
of entry in the Philippines;
Sec. 213. Reports of the
District Collector to the
Commissioner. – The District
Collector shall report to the
Commissioner any probable
or initiated litigation within the
Customs District and shall
submit regular monthly
reports on all district
transactions.
CHAPTER 3
EXERCISE OP POLICE
AUTHORITY
SBC. 214. Persons
Exercising Police Authority. –
For the effective
implementation of this Act,
the following persons are
authorized to effect search,
seizure, and arrest:
(a) Officials of the Bureau,
District Collectors, Deputy
District Collectors, police
officers, agents, inspectors
and guards of the Bureau;
(b) Upon authorization of the
Commissioner, officers and
members of the Armed
Forces of the Philippines
(AFP) and national law
enforcement agencies; and
(c) Officials of the BIR on all
cases falling within the
regular performance of their
duties, when payment of
declared in the entry, the
correct dutiable value of the
article shall be ascertained by
the Commissioner Of
Customs from the reports of
the Revenue or Commercial
Attache (Foreign Trade
Promotion Attache), pursuant
to Republic Act Numbered
Fifty-four Hundred and Sixty-
six or other Philippine
diplomatic officers or
Customs Attaches and from
such other information that
may be available to the
Bureau of Customs. Such
values shall be published by
the Commissioner of
Customs from time to time.
When the dutiable value
cannot be ascertained as
provided in the preceding
paragraphs, or where there
exists a reasonable doubt as
to the dutiable value of the
imported article declared in
the entry, it shall be domestic
wholesale selling price of
such or similar article in
Manila or other principal
markets in the Philippines or
on the date the duty become
payable on the article under
appraisement, on the usual
wholesale quantities and in
the ordinary course of trade,
minus:
(4) Loading, unloading and
handling charges associated
with the transport of the
imported goods from the
country of exportation to the
port of entry in the
Philippines; and
(5) The cost of insurance.
All additions to the price
actually paid or payable shall
be made only on the basis of
objective and quantifiable
data.
No additions shall be made
to the price actually paid or
payable in determining the
customs value except as
provided in this Sec. :
Provided, That Method One
shall not be used in
determining the dutiable
value of imported goods if:
(a) There are restrictions
as to the disposition or use of
the goods by the buyer other
than restrictions which:
(i) Are imposed or
required by law or by
Philippine authorities;
(ii) Limit the
geographical area in which
the goods may be resold; or
(iii) Do not substantially
affect the value of the goods.
internal revenue taxes is
involved.
All officers authorized by the
Commissioner to exercise
police authority shall at all
times coordinate with the
Commissioner.
Goods seized by deputized
officers pursuant to this
section shall be physically
turned-over immediately to
the Bureau, unless provided
under existing laws, rules and
regulations.
For this purpose, mission
orders shall clearly indicate
the specific name carrying
out the mission and the tasks
to be carried out.
Subject to the approval of the
Secretary of Finance, the
Commissioner shah1 define
the scope, areas covered,
procedures and conditions
governing the exercise of
such police authority
including custody and
responsibility for the seized
goods. The rules and
regulations to this effect shall
be furnished to the
concerned government
agencies and personnel for
guidance and compliance.
All seizures pursuant to this
section must be effected in
accordance with the

Sec. 202. Bases of Dutiable
Weight. — On articles that
are subject to specific rate of
duty, based on weight, the
duty shall be ascertained as
follows:
a. When articles are
dutiable by the gross weight,
the dutiable weight thereof
shall be the weight of same,
together with the weight of all
containers, packages,
holders and packings, of any
kind, in which said articles
are contained, held or packed
at the time of importation.
b. When articles are
dutiable by the legal weight,
the dutiable weight thereof
shall be the weight of same,
together with the weight of
the immediate containers,
holders and/or packing in
which such articles are
usually contained, held or
packed at the time of
importation and/or, when
imported in retail packages,
at the time of their sale to the
(a) not more than twenty-
five (25) per cent thereof for
expenses and profits; and
(b) duties and taxes paid
thereon. (as amended by
E.O. 156)
Sec. 202. Bases of Dutiable
Weight. — On articles that
are subject to the specific
rate of duty, based on weight,
the duty shall be ascertained
as follows:
(a) When articles are
dutiable by the gross weight,
the dutiable weight thereof
shall be the weight of same,
together with the weight of all
containers, packages,
holders and packing, of any
kind, in which said articles
are contained, held or packed
at the time of importation.
(b) When articles are
dutiable by the legal weight
thereof shall be the weight of
same, together with the
weight of the immediate
containers, holders and/or
packing in which such articles
are usually contained, held or
packed at the time of
importation and/or, when
imported in retail packages,
at the time of their sale to the
public in usual retail
quantities:
(b) The sale or price is
subject to some condition or
consideration for which a
value cannot be determined
with respect to the goods
being valued;
(c) Part of the proceeds of
any subsequent resale,
disposal or use of the goods
by the buyer will accrue
directly or indirectly to the
seller, unless an appropriate
adjustment can be made in
accordance with the
provisions hereof; or
(d) The buyer and the
seller are related to one
another, and such
relationship influenced the
price of the goods. Such
persons shall be deemed
related if:
(i) They are officers or
directors of one another's
businesses;
(ii) They are legally
recognized partners in
business;
(iii) There exists an
employer-employee
relationship between them;
(iv) Any person directly
or indirectly owns, controls or
holds five percent (5%) or
more of the outstanding
provisions on the conduct of
seizure proceedings provided
for in Chapters 3 and 4 of
Title XI of this Act.
Sec. 215. Place Where
Authority May be Exercised.
– All persons exercising
police authority as described
in the preceding section shall,
only exercise powers within
customs premises as
provided for in Section 303 of
this Act, and within the limits
of the authority granted by
the Commissioner.
Port and airport authorities in
all ports of entry shall provide
authorized customs officers
with unhampered access to
all premises within their
administrative jurisdiction.
Sec. 216. Exercise of Power
of Seizure. – Any person
exercising police authority
under this Act has the power
and duty to seize any vessel,
aircraft, cargo, goods, animal
or any other movable
property when the same is
subject to forfeiture or when
they are subject of a fine
imposed under this Act.
Sec. 217. Duty of Officer to
Disclose Official Character. –
For the proper exercise of
police authority, any
authorized person shall
disclose the nature of the
public in usual retail
quantities: Provided, That
when articles are packed in
single container, the weight
of the latter shall be included
in the legal weight.
. .
c. When articles are
dutiable by the net weight,
the dutiable weight thereof
shall be only the actual
weight of the articles at the
time of importation, excluding
the weight of the immediate
and all other containers,
holders or packing in which
such articles are contained,
held or packed.
d. Articles affixed to
cardboard, cards, paper,
wood or similar common
material shall be dutiable
together with the weight of
such holders.
. contains imported articles
e. When a single package
contains imported articles
dutiable according to different
weights, or to weight and
value, the common exterior
receptacles shall be prorated
and the different proportions
thereof treated in accordance
with the provisions of this
Code as to the dutiability or
non-dutiability of such
packing.
Sec. 203. General Rules of
Classification. — The
interpretation and application
Provided, That when
articles are packed in single
container, the weight of the
latter shall be included in the
legal weight.
(c) When articles are
dutiable by the net weight,
the dutiable weight thereof
shall be only the actual
weight of the articles at the
time of importation, excluding
the weight of the immediate
and all other containers,
holders or packing in which
such articles are contained,
held or packed.
(d) Articles affixed to
cardboard, cards, paper,
wood or similar common
material shall be dutiable
together with the weight of
such holders.
(e) When a single package
dutiable according to different
weights, or to weight and
value, the common exterior
receptacles shall be prorated
and the different proportions
thereof treated in accordance
with the provisions of this
Code as to the dutiability or
non-dutiability of such
packing.
Sec. 203. Rate of Exchange.
— For the assessment and
collection of import duty upon
imported articles and for
voting stock or shares of both
seller and buyer;
(v) One of them directly
or indirectly controls the
other;
(vi) Both of them are
directly or indirectly controlled
by a third person;
(vii) Together they
directly or indirectly control a
third person; or
(viii) They are members
of the same family, including
those related by affinity or
consanguinity up to the fourth
civil degree.
Persons who are
associated in business with
one another in that one is the
sole agent, sole distributor or
sole concessionaire, however
described, of the other shall
be deemed to be related for
the purposes of this Act if
they fall within any of the
eight (8) cases above.
(B) Method Two.
Transaction Value of Identical
Goods. Where the dutiable
value cannot be determined
under method one, the
dutiable value shall be the
transaction value of identical
goods sold for export to the
Philippines and exported at
or about the same time as
authority upon being
questioned at the time of
exercise thereof and shall
exhibit the corresponding
written authority issued by
the Commissioner.
Sec. 218. Authority to
Require Assistance and
Information. – Any person
exercising police authority
may demand the assistance
of and request information
from the Philippine National
Police (PNP), the AFP and
other national law
enforcement agencies, when
necessary, to effect any
search, seizure or arrest. It
shall be the duty of any police
officer and other national law
enforcers to give such lawful
assistance.
Sec. 219. Authority to Enter
Properties. – Any person
exercising police authority
may, at any time, enter, pass
through, and search any
land, enclosure, warehouse,
store, building or structure
not principally used as a
dwelling house.
When a security personnel or
any other employee lives in
the warehouse, store, or any
building, structure or
enclosure that is used for
storage of goods, it shall not
be considered as a dwelling
of the provisions of this Code
relating to the classification of
articles imported into the
Philippines shall be governed
by the following principles:
RULE 1. The titles of
schedules, chapters and
subchapters are provided for
ease of reference only; for
legal purposes, classification
shall be determined
according to the terms of the
headings or subheadings and
any relative schedule or
chapter notes and, provided
such headings, subheadings
or notes do not otherwise
require, according to the
succeeding rules.
. .
RULE 2. Any reference in
a heading or subheading to a
material or substance shall
include a reference to
mixtures or combinations of
that material or substance
with other materials or
substances. Any reference to
articles of a given material or
substance shall include a
reference to articles
consisting wholly or partly of
such material or substance.
The classification of articles
consisting of more than one
material or substance shall
be according to the principles
of Rule 3.
. any concealed dutiable or
RULE 3. When articles
are, prima facie, classifiable
other purposes, the value
and prices thereof quoted in
foreign currency shall be
converted into the currency of
the Philippines at the current
rate of exchange or value
specified or published, from
time to time, by the Central
Bank of the Philippines.
the goods being valued.
"Identical goods" shall mean
goods which are the same in
all respects, including
physical characteristics,
quality and reputation. Minor
differences in appearances
shall not preclude goods
otherwise conforming to the
definition from being
regarded as identical.
(C) Method Three.
Transaction Value of Similar
Goods. Where the dutiable
value cannot be determined
under the preceding method,
the dutiable value shall be
the transaction value of
similar goods sold for export
to the Philippines and
exported at or about the
same time as the goods
being valued. "Similar goods"
shall mean goods which,
although not alike in all
respects, have like
characteristics and like
component materials which
enable them to perform the
same functions and to be
commercially
interchangeable. The quality
of the goods, their reputation
and the existence of a
trademark shall be among
the factors to be considered
in determining whether goods
are similar.
If the dutiable value still
cannot be determined
house for purposes of this
Act.
Sec. 220. Authority to Search
Dwelling House. – A dwelling
house may be entered and
searched only upon warrant
issued by a Judge of a
competent court, the sworn
application thereon showing
probable cause and
particularly describing the
place to be searched and the
goods to be seized.
Sec. 221. Authority to Search
Vessels or Aircrafts and
Persons or Goods Conveyed
Therein. – Any person
exercising police authority
under this Act may board,
inspect, search and examine
a vessel or aircraft and any
container, trunk, package,
box or envelope found on
board, and physically search
and examine any person
thereon. In case of any
probable violation of this Act,
the person exercising police
authority may seize the
goods, vessel, aircraft, or any
part thereof.
Such power to search
includes removal of any false
bottom, partition, bulkhead,
or any other obstruction for
the purpose of uncovering
forfeitable goods.
under two or more headings
or subheadings, classification
shall be effected as follows:
a. The heading or
subheading which provides
the most specific description
shall be preferred to any
other heading or subheading
providing a more general
description.
. application of methods four
b. Mixtures and
composite articles which
consist of different materials
or are made up of different
components and which
cannot be classified by
reference to "a" shall be
classified as if they consisted
of the material or component
which give the articles their
essential character, insofar
as this criterion is applicable.
. be so determined.
c. When articles cannot
be classified by reference to
"a" or "b" they shall be
classified under the heading
or subheading which
provides the highest rate of
duty.
RULE 4. Where in a note
to a schedule or chapter it is
provided that certain articles
are not covered by that
schedule or chapter a
reference being made to
another schedule or chapter
or to a particular heading or
subheading, the note shall,
through the successive
application of the two
immediately preceding
methods, the dutiable value
shall be determined under
method four or, when the
dutiable value still cannot be
determined under that
method, under method five,
except that, at the request of
the importer, the order of
and five shall be reversed:
Provided, however, That if
the Commissioner of
Customs deems that he will
experience real difficulties in
determining the dutiable
value using method five, the
Commissioner of Customs
may refuse such a request in
which event the dutiable
value shall be determined
under method four, if it can
(D) Method Four.
Deductive Value. The
dutiable value of the imported
goods under this method
shall be the deductive value
which shall be based on the
unit price at which the
imported goods or identical or
similar imported goods are
sold in the Philippines, in the
same condition as when
imported, in the greatest
aggregate quantity, at or
about the time of the
importation of the goods
being valued, to persons not
The proceeding herein
authorized shall not give rise
to any claim for damage
caused to the goods, vessel
or aircraft, unless there is
gross negligence or abuse of
authority in the exercise
thereof.
Sec. 222. Authority to Search
Vehicles, Other Carriers,
Persons and Animals. –
Upon reasonable cause, any
person exercising police
authority may open and
examine any box, trunk,
envelope, or other container
for purposes of determining
the presence of dutiable or
prohibited goods. This
authority includes the search
of receptacles used for the
transport of human remains
and dead animals. Such
authority likewise includes
the power to stop, search,
and examine any vehicle or
carrier, person or animal
suspected of holding or
conveying dutiable or
prohibited goods.
Sec. 223. Authority to Search
Persons Arriving From
Foreign Countries. – Upon
reasonable cause, travelers
arriving from foreign
countries may be subjected
to search and detention by
the customs officers. The
dignity of the person under
search and detention shall be
unless the context requires
otherwise, refer to all the
articles falling within that
other schedule or chapter or
heading or subheading
notwithstanding that only
certain of those articles are
referred to by description in
the note.
. profit and general expenses
RULE 5. When dutiable
and duty-free articles or
those dutiable at different
rates are packed together or
mingled in such manner that
the value of each class of
such article cannot be readily
determined by the officials of
the Bureau of Customs, all
such articles shall pay duty at
the rate applicable to that
article in the package which
is subject to the highest rate
of duty, unless the importer
or consignee segregates
such article at his own risk
and on his account, under the
supervision of customs
officials, within fifteen days
after the acceptance of
import entry covering same,
and before delivery, in order
that the value of each article
may be determined.
. sold at or about the time of
RULE 6. In classifying
manufactured products, no
account shall be taken of the
following:
a. Insignificant parts of
composite goods, in
related to the persons from
whom they buy such goods,
subject to deductions for the
following:
(1) Either the
commissions usually paid or
agreed to be paid or the
additions usually made for
in connection with sales in
such country of imported
goods of the same class or
kind;
(2) The usual costs of
transport and insurance and
associated costs incurred
within the Philippines; and
(3) Where appropriate,
the costs and charges
referred to in subsection (A)
(3), (4) and (5); and
(4) The customs duties
and other national taxes
payable in the Philippines by
reason of the importation or
sale of the goods.
If neither the imported
goods nor identical nor
similar imported goods are
importation of the goods
being valued in the
Philippines in the conditions
as imported, the customs
value shall, subject to the
conditions set forth in the
preceding paragraph hereof,
respected at all times.
Female inspectors may be
employed for the examination
and search of persons of
their own sex.
Sec. 224. Power to Inspect
and Visit. – The
Commissioner or any
customs officer who is
authorized in writing by the
Commissioner, may demand
evidence of payment of
duties and taxes on imported
goods openly for sale or kept
in storage. In the event that
the interested party fails to
produce such evidence within
fifteen (15) days, the goods
may be seized and subjected
to forfeiture proceedings:
Provided, That during the
proceedings, the interested
party shall be given the
opportunity to prove or show
the source of the goods and
the payment of duties and
taxes thereon: Provided,
further, That when the
warrant of seizure has been
issued but subsequent
documents presented
evidencing proper payment
are found to be authentic and
in order, the District Collector
shall, within fifteen (15) days
from the receipt of the motion
to quash or recall the
warrant, cause the immediate
release of the goods seized,
subject to clearance by the
Commissioner: Provided,
particular such as are used
solely for mounting or
connecting separate parts
(e.g., nails, rivets, screws,
washers, gaskets, locks,
clamps, eyelets, clasps,
hinges, bolts, cornerpieces,
bands, threads, strings,
beltings, straps, ropes);
. after such importation.
b. Negligible processing,
refinement and decorations;
. goods nor identical nor
c. Manufacturers' marks
or names or trade marks,
indications of the country of
origin of the types of articles,
their sizes or capacities,
calibration marks, indications
of graduation and the like, not
of an ornamental character.
RULE 7. Unless otherwise
provided for, unfinished and
incomplete articles shall be
classified as the finished and
complete articles, provided
their intended use is
recognizable.
RULE 8. Unless otherwise
provided for, the separate
parts and unassembled
pieces of articles which
normally consist of various
component parts, shall be
classified as complete
articles, when imported
together by the same
importer, owner or consignee
from the same seller or
shipper on the same vessel
be based on the unit price at
which the imported goods or
identical or similar imported
goods sold in the Philippines
in the condition as imported
at the earliest date after the
importation of the goods
being valued but before the
expiration of ninety (90) days
If neither the imported
similar imported goods are
sold in the Philippines in the
condition as imported, then, if
the importer so requests, the
dutiable value shall be based
on the unit price at which the
imported goods, after further
processing, are sold in the
greatest aggregate quantity
to persons in the Philippines
who are not related to the
persons from whom they buy
such goods, subject to
allowance for the value
added by such processing
and deductions provided
under Subsections (D)(1),
(2), (3) and (4) hereof.
(E) Method Five.
Computed Value. The
dutiable value under this
method shall be the
computed value which shall
be the sum of:
(1) The cost or the value
of materials and fabrication or
other processing employed in
finally, That the release
thereof shall not be contrary
to law.
TITLE III
CUSTOMS JURISDICTION
AND CUSTOMS CONTROL
CHAPTER 1
CUSTOMS JURISDICTION
Sec. 300. Customs
Jurisdiction. – For the
effective implementation of
this Act, the Bureau shall
exercise jurisdiction over all
seas within Philippine
territory and all coasts, ports,
airports, harbors, bays, rivers
and inland waters whether
navigable or not from the sea
and any means of
conveyance.
The Bureau shall pursue
imported goods subject to
seizure during its transport by
land, water and air and shall
exercise jurisdiction as may
be necessary for the effective
enforcement of this Act.
When a vessel or aircraft
becomes subject to seizure
for violation of this Act, a
pursuit of such vessel or
aircraft which began within
the territorial waters or air
space may continue beyond
the same, and the vessel or
aircraft may be seized in the
or vehicle. The absence of
certain non-essential parts
does not affect the
application of this provision.
. and general expenses equal
RULE 9. Accessories and
spare parts shall be classified
with the articles with which
they are imported, when, by
their character and quantity,
they correspond to such
articles and when they are
usually sold together with
them and are included in the
price of such article.
. .
RULE 10. Cases, boxes,
caskets, sheaths and the like,
of normal type (e.g., such as
are used for cutlery,
binoculars, microscopes,
watches, musical
instruments, weapons, sport
goods) imported with the
corresponding articles, shall
be classified as such articles;
if imported separately, they
shall be classified under the
corresponding heading or
subheading of this Code.
RULE 11. No duties shall
be assessed on account of
the usual coverings or
holdings of articles dutiable
otherwise than ad valorem,
nor those free of duty, except
as in this Code expressly
provided, but if there be used
for covering or holding
imported articles, whether
dutiable or free, any unusual
producing the imported
goods;
(2) The amount for profit
to that usually reflected in the
sale of goods of the same
class or kind as the goods
being valued which are made
by producers in the country of
exportation for export to the
Philippines;
(3) The freight,
insurance fees and other
transportation expenses for
the importation of the goods;
(4) Any assist, if its
value is not included under
paragraph (1) hereof; and
(5) The cost of
containers and packing, if
their values are not included
under paragraph (1) hereof.
The Bureau of Customs
shall not require or compel
any person not residing in the
Philippines to produce for
examination, or to allow
access to, any account or
other record for the purpose
of determining a computed
value. However, information
supplied by the producer of
the goods for the purposes of
determining the customs
value may be verified in
another country with the
agreement of the producer
high seas or international air
space.
CHAPTER 2
CUSTOMS CONTROL
Sec. 301. Customs Control
Over Goods. – All goods,
including means of transport,
entering or leaving the
customs territory, regardless
of whether they are liable to
duties and taxes, shall be
subject to customs control to
ensure compliance with this
Act.
In the application of customs
control, the Bureau shall
employ audit-based controls
and risk management
systems, use automation to
the fullest extent possible,
and adopt a compliance
measurement strategy to
support risk management.
The Bureau shall seek to
cooperate and conclude
mutual administrative
assistance agreements with
other customs
administrations to enhance
customs control. The Bureau
shall consult, coordinate, and
cooperate with other
government regulatory
agencies, free zones
authorities, and the customs
stakeholders, in general, to
enhance customs control.
article, form or material and provided they will give
adapted for use otherwise sufficient advance notice to Sec. 302. Enforcement of
than in the bona fide the government of the Port Regulation of the Bureau
preservation or transportation country in question and the of Quarantine. – Customs
of such article to the latter does not object to the officials and employees shall
Philippines, such covering or investigation. cooperate with the quarantine
holding shall be classified authorities in the enforcement
under the corresponding (F) Method Six. Fallback of the port quarantine
heading or subheading of this Value. If the dutiable value regulations promulgated by
Code. cannot be determined under the Bureau of Quarantine and
. the preceding methods shall give effect to the same
RULE 12. When the described above, it shall be insofar as connected with
interior container or packing determined by using other matters of shipping and
of any article dutiable by Sec. 204. Effective Date of reasonable means and on navigation.
weight is of an unusual Rates of Import Duty. — the basis of data available in
character, such container or Imported articles shall be the Philippines. Sec. 303. Control Over
packing shall be classified subject to the rate or rates of Premises Used for Customs
under the corresponding import duty existing at the If the importer so requests, Purposes. – The Bureau
heading or subheading of this time of entry, or withdrawal the importer shall be shall, for customs purposes,
Code. from warehouse, in the informed in writing of the have exclusive control,
. Philippines, for consumption. dutiable value determined direction and management of
RULE 13. When an article under Method Six and the customs offices, facilities,
falling within a heading or On and after the day when method used to determine warehouses, ports, airports,
subheading is subject to ad this Code shall go into effect, such value. wharves, infrastructure and
valorem or specific rate of all articles previously other premises in the
duty, it shall be subject to imported, for which no entry No dutiable value shall be Customs Districts, in all
either the ad valorem or the has been made, and all determined under Method Six cases without prejudice to the
specific rate of duty articles previously entered on the basis of: general police powers of the
whichever is higher. without payment of duty and local government units
under bond for warehousing, (1) The selling price in (LGUs), the Philippine Coast
RULE 14.Unless otherwise transportation, or any other the Philippines of goods Guard and of law
provided for, the term "used" purpose, for which no permit produced in the Philippines; enforcement agencies in the
or any provision indicating of delivery to the importer or exercise of their respective
designation by use, for the his agent has been issued, (2) A system that functions.
purpose of classification and shall be subject to the rates provides for the acceptance
taxation of articles shall mean of any duty imposed by this for customs purposes of the Sec. 304. Power of the
the chief or predominant use Code and to any other duty, higher of two alternative President to Subject
of such articles upon the entry, or withdrawal values; Premises to Customs
notwithstanding any fugitive thereof from warehouse, for Jurisdiction. – When public
or incidental use to which consumption. (3) The price of goods in interest requires, the
such articles may be the domestic market of the President may, by executive
subjected. country of exportation; order, declare any public

RULE 15. Articles not
falling within any heading or
subheading of this Code shall
be classified under the
heading or subheading
appropriate to articles to
which they are most akin.
Sec. 204. Rate of Exchange.
— For the assessment and
collection of import duty upon
imported articles and for
other purposes, the value
and prices thereof quoted in
foreign currency shall be
converted into the currency of
the Philippines at the current
rate of exchange or value
specified or published, from
time to time, by the Central
Bank of the Philippines.
. specified entry form is
Sec. 205. Effective Date of
Rates of Import Duty. —
Imported articles shall be
subject to the rate or rates of
import duty existing at the
time of entry, or withdrawal
from warehouse in the
Philippines, for consumption.
. designated to receive such
On and after the day when
this Code shall go into effect
all articles previously
imported, for which no entry
has been made, and all
articles previously entered
without payment of duty and
under bond for warehousing,
transportation, or any other
purpose, for which no permit
On article abandoned or
forfeited to, or seized by, the
government, and then sold at
public auction, the rates of
duty and the tariff in force on
the date of the auction shall
apply: Provided, That duty
based on the weight, volume
and quantity of articles shall
be levied and collected on
the weight, volume and
quantity at the time of their
entry into the warehouse or
the date of abandonment,
forfeiture and/or seizure.
Sec. 205. Entry, or
Withdrawal from Warehouse,
for Consumption. — Imported
articles shall be deemed
"entered" in the Philippines
for consumption when the
properly filed and accepted,
together with any related
documents required by the
provisions of this Code
and/or regulations to be filed
with such form at the time of
entry, at the port or station by
the customs official
entry papers and any duties,
taxes, fees and/or other
lawful charges required to be
paid at the time of making
such entry have been paid or
secured to be paid with the
customs official designated to
receive such monies,
provided that the article has
(4) The cost of
production, other than
computed values, that have
been determined for identical
or similar goods in
accordance with Method Five
hereof;
(5) The price of goods
for export to a country other
than the Philippines;
(6) Minimum customs
values; or
(7) Arbitrary or fictitious
values.
If in the course of
determining the dutiable
value of imported goods, it
becomes necessary to delay
the final determination of
such dutiable value, the
importer shall nevertheless
be able to secure the release
of the imported goods upon
the filing of a sufficient
guarantee in the form of a
surety bond, a deposit, cash
or some other appropriate
instrument in an amount
equivalent to the imposable
duties and taxes on the
imported goods in question
conditioned upon the
payment of customs duties
and taxes for which the
imported goods may be
liable: Provided, however,
That goods, the importation
wharf, landing place,
infrastructure, street or land,
in any port of entry under the
jurisdiction of the Bureau as
may be necessary, for
customs purposes and/or to
authorize a port or terminal
operator to transfer
overstaying cargoes in an
inland depot or terminal.
Sec. 305. Trespass or
Obstruction of Customs
Premises. – No person shall
enter or obstruct a customs
office, warehouse, port,
airport, wharf, or other
premises under the control of
the Bureau without prior
authority, including the
streets or alleys where these
faculties are located.
Sec. 306. Special
Surveillance for the
Protection of Customs
Revenue and Prevention of
Smuggling. – The Bureau
shall conduct surveillance on
vessels or aircrafts entering
Philippine territory and on
imported goods entering the
customs office: Provided,
That the function of the
Philippine Coast Guard to
prevent and suppress the
illegal entry of these goods,
smuggling and other forms of
customs fraud and violations
of maritime law and its proper
surveillance of vessels
entering and/or leaving
of delivery to the importer or
his agent has been issued,
shall be subject to the rates
of duty imposed by this Code
and to no other duty, upon
the entry, or withdrawal
thereof from warehouse, for
consumption.
On articles abandoned or
forfeited to, or seized by, the
government, and then sold at
public auction, the rate of
duty and the tariff in force on
the date of the auction shall
apply: Provided, That duty
based on the weight, volume
and quantity of articles shall
be levied and collected on
the weight, volume and
quantity at the time of their
entry into the warehouse or
the date of abandonment,
forfeiture and/or seizure.
Sec. 206. Entry, Withdrawal
from Warehouse, for
Consumption. — Imported
articles shall be deemed
"entered" in the Philippines
for consumption when the
specified entry form is
properly filed and accepted,
together with any related
documents required by the
provisions of this Code
and/or regulations to be filed
with such form at the time of
entry, at the port or station by
the customs official
designated to receive such
entry papers and any duties,
previously arrived within the
limits of the port of entry.
Imported articles shall be
deemed "withdrawn" from
warehouse in the Philippines
for consumption when the
specified form is properly
filed and accepted, together
with any related documents
required by any provisions of
this Code and/or regulations
to be filed with such form at
the time of withdrawal, by the
customs official designated to
receive the withdrawal entry
and any duties, taxes, fees
and/or other lawful charges
required to be paid at the
time of withdrawal have been
deposited with the customs
official designated to receive
such payment.
PART 2
SPECIAL DUTIES
Sec. 301. Dumping Duty. —
of which is prohibited by law
shall not be released under
any circumstance
whatsoever.
Nothing in this Sec. shall
be construed as restricting or
calling into question the right
of the Collector of Customs to
satisfy himself as to the truth
or accuracy of any statement,
document or declaration
presented for customs
valuation purposes. When a
declaration has been
presented and where the
customs administration has
reason to doubt the truth or
accuracy of the particulars or
of documents produced in
support of this declaration,
the customs administration
may ask the importer to
provide further explanation,
including documents or other
evidence, that the declared
value represents the total
amount actually paid or
payable for the imported
goods, adjusted in
accordance with the
provisions of Subsection (A)
hereof.
If, after receiving further
information, or in the absence
of a response, the customs
administration still has
reasonable doubts about the
truth or accuracy of the
declared value, it may,
without prejudice to an
Philippine territory as
provided in Republic Act No.
9993, otherwise known as
the "Philippine Coast Guard
Law of 2009", shall continue
to be in force
Sec. 307. Temporary Storage
of Goods. – Subject to the
rules and regulations to be
issued by the Secretary of
Finance, the Commissioner
shall establish a system for
temporary storage of imports
prior to goods declaration in
case of abandoned or
overstaying-goods.
TITLE IV
IMPORT CLEARANCE AND
FORMALITIES
CHAPTER 1
GOODS DECLARATION
Sec. 400. Goods to be
Imported through Customs
Office. – 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. 401. Importations
Subject to Goods
Declaration. – Unless
otherwise provided for in this
taxes, fees and/or other
lawful charges required to be
paid at the time of making
such entry have been paid or
secured to be paid with the
customs official designated to
receive such monies,
provided that the article has
previously arrived within the
limits of the port of entry.
. foreign article, is being
Imported articles shall be
deemed "withdrawn" from
warehouse in the Philippines
for consumption when the
specified form is properly
filed and accepted, together
with any related documents
required by any provisions of
this Code and/or regulations
to be filed with such form at
the time of withdrawal, by the
customs official designated to
receive the withdrawal entry
and any duties, taxes, fees
and/or other lawful charges
required to be paid at the
time of withdrawal have been
deposited with the customs
official designated to receive
such payment.
Sec. 207. Revised Trade
Agreement not Affected. —
Nothing in this Code shall be
construed to abrogate or in
any manner impair or affect
the provisions of the Revised
Agreement concluded
between the Philippines and
the United States on
September 6, 1955.
a. Whenever the Secretary
of Finance (hereinafter called
the "Secretary") has reason
to believe, from invoices or
other documents or
newspapers, magazines or
information made available
by any government agency or
interested party, that a
specific kind or class of
imported into, or sold or is
likely to be sold in the
Philippines, at a price less
than its fair value, the
importation and sale of which
might injure, or retard the
establishment of, or is likely
to injure, an industry
producing like goods in the
Philippines, he shall so
advise the Tariff Commission
(hereinafter called the
"Commission"), and shall
instruct the Collector of
Customs to require an anti-
dumping bond of twice the
dutiable value of the imported
article coming from the
specific country.
b. The Commission, upon
receipt of the advice from the
Secretary shall conduct an
investigation to:
1. Verify if the kind or
class of article in question is
being imported into, or sold
or is likely to be sold in the
Philippines at a price less
than its fair value;
importer's right to appeal
pursuant to Article 11 of the
World Trade Organization
Agreement on customs
valuation, be deemed that the
customs value of the
imported goods cannot be
determined under Method
One. Before taking a final
decision, the Collector of
Customs shall communicate
to the importer, in writing if
requested, his grounds for
doubting the truth or
accuracy of the particulars or
documents produced and
give the importer a
reasonable opportunity to
respond. When a final
decision is made, the
customs administration shall
communicate to the importer
in writing its decision and the
grounds therefor."
Act, 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.
Sec. 402. Goods Declaration
for Consumption. – All goods
declaration for consumption
shall be cleared through a
formal entry process except
for the following goods which
shall be cleared through 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
(P50,000.00). Every three (3)
years after the effectivity of
this Act, the Secretary of
Finance shall adjust this
amount as provided herein to
its present value, using the
Consumer Price Index (CPI)
as published by the PSA; and
(b) Personal and household
effects or goods, not in
commercial quantity,
imported in a passenger's
baggage or mail.
The Commissioner may
adjust the value of goods of
commercial nature that shall

PART 2
SPECIAL DUTIES
Sec. 301. Dumping Duty. —
a. Whenever the Secretary of
Finance (hereinafter called
the Secretary") has reason to
believe, from invoices or
other papers or from
information made available to
him by any government
agency or interested party,
that a specific kind or class of
foreign article, whether
dutiable or duty-free, is being
sold or is likely to be sold for
exportation to, or in, the
Philippines, at a price less
than its fair value, as
hereinafter defined, the
importation or sale of which
might injure, or prevent the
establishment of, or is likely
to injure an industry in the
Philippines, he shall so
advise the Tariff Commission
(hereinafter called the
"Commission").
. countries other than the
b. The Commission, upon
receipt of such advice from
the Secretary, shall conduct
an investigation to —
1. Verify if the kind or class
of articles in question is being
sold or is likely to be sold for
exportation to, or in, the
Philippines at a price less
than its fair value;
The fair value of an
article shall be its home
consumption price, excluding
internal excise tax.
If the fair value of an
article cannot be determined,
the following rules shall
apply:
i. If the home
consumption price is
unreliable because of
association or a
compensatory arrangement
between the exporter and the
importer or a third party, or if
the quality of like to similar
articles sold by the producers
for home consumption is
negligible in relation to the
quality sold for exportation to
countries other than the
Philippines as to be an
inadequate basis for
comparison, then the fair
value of the articles shall be
based from the export price
of like articles sold to
Philippines, or
ii. If the country of
export is a state-controlled
economy, then the fair value
of like articles shall be the
home consumption price of
like articles in a proxy country
at the same stage of
economic development which
is a proven or established
be cleared through an
informal entry process
without prejudice to the
periodic adjustment period in
subparagraph (a) of this
section.
All importations entered
through a formal entry
process shall be covered by
a letter of credit or any
verifiable commercial
document evidencing
payment or in cases where
there is no sale for export, by
any commercial document
indicating the commercial
value of the goods.
Sec. 403. Provisional Goods
Declaration. – Where the
declarant does not have all
the information or supporting
documents required to
complete the goods
declaration, the lodging of a
provisional goods declaration
may be allowed: Provided,
That it substantially contains
the necessary information
required by the Bureau and
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.
 chan robles virtual law lib .
rary
2. Determine if, as a result
thereof, an industry in the
Philippines is being injured or
is likely to be injured or is
prevented from being
established by reason of the
importation or sale of such
kind or class of article into the
Philippines; and
. origin or the country of export
3. Ascertain the difference,
if any, between the purchase
price or, in the absence
thereof, the exporter's sales
price, and the fair value of the
article. The Commission shall
submit its findings to the
Secretary within one month
after receipt of the aforesaid
advice.
c. The Secretary shall, within
fifteen days from the report of
the Commission, decide
whether the article in
question is being imported in
violation of this section and
shall give due notice of such
finding and shall direct the
Commissioner of Customs to
cause the dumping duty, to
be levied, collected and paid,
as prescribed in this section,
in addition to any other
duties, taxes and charges
imposed by law on such
article.
. .
d. The "dumping duty" as
provided for in subsection "e"
competitive producer of the
article under consideration.
iii. In the case where
products are not imported
directly from the country of
origin but are exported to the
country of importation from
an intermediate country, the
fair value shall be the home
consumption in the country of
whichever is higher.
iv. If the fair value of
such or like articles cannot be
determined in accordance
with the preceding
paragraphs then, the fair
value of the article under
consideration shall be its cost
of production as determined
of calculated from reasonably
available data.
2. Determine if, as a
result thereof, an industry
producing like goods in the
Philippines, is being injured
or is likely to be injured or is
retarded from being
established by reason of the
importation or sale of that
kind or class of article into the
Philippines: Provided, That a
finding that an article is being
imported into the Philippines
at a price less than its fair
market value shall be
deemed prima facie proof of
injury, or retarding the
establishment of an industry
producing like goods in the
If the Bureau accepts a
provisional goods
declaration, the duty
treatment of the goods shall
not be different from that of
goods with complete
declaration. 'I Goods under a
provisional goods declaration
may be released upon
posting of any required
security equivalent to the
amount ascertained to be the
applicable duties and taxes.
Sec. 404. Owner of Imported
Goods. – All goods imported
into the Philippines shall be
deemed to be the property of
the consignee or the holder
of the bill of lading, airway bill
or other equivalent transport
document if duly endorsed by
the consignee therein, or, if
consigned to order, duly
endorsed by the consignor.
The underwriters of
abandoned goods and the
salvors of goods saved from
wreck at sea, coast, or in any
area of the Philippines, may
be regarded as the
consignees. Sec. 405.
Liability of Importer for Duties
and Taxes. – Unless relieved
by laws or regulations, the
liability for duties, taxes, fees,
and other charges attached
to importation constitutes a
personal debt due and
demandable against the
importer in favor of the
government and shall be
hereof shall be equal to the
difference between the
purchase price or, in the
absence thereof, the
exporter's sales price, and
the fair value of the article.
. whether the wholesale prices
e. For the purpose of this
section —
1. The "fair value" of an
article shall be its foreign
market value, or, in the
absence of such value, its
cost of production.
. 3. Ascertain the
2. The "purchase price" of
an imported article shall be
the price at which such article
has been purchased or
agreed to be purchased, prior
to the time of exportation, by
the person by whom or for
whose account the article is
imported, plus, when not
included in such price —
(a) The cost of all
containers and coverings and
all other costs, charges and
expenses incident to placing
the article in condition,
packed ready for shipment to
the Philippines;
chan robles virtual law
libra . ry
(b) The amount of any
export tax paid in the country
of exportation on the
exportation of the article to
the Philippines;
. prescribed in this section, in
Philippines: And provided,
further, That in determining
whether the domestic
industry has suffered is being
threatened with injury, the
Commission shall determine
at which the domestic
products are sold are
reasonable, taking into
account the cost of raw
materials, labor, overhead, a
fair return on investment and
the overall efficiency of the
industry; and
difference, if any, between
the purchase price and the
fair market value of the
article. The Commission shall
submit its findings to the
Secretary within sixty (60)
days after the submission of
the memoranda of the parties
which shall not be later than
fifteen (15) days after the
termination of the public
hearing.
c. The Secretary shall,
within sixty (60) days after
receipt of the report of the
Commission, decide whether
the article in question is being
imported in violation of this
section and shall give due
notice of such decision and
shall direct the Commissioner
of Customs to cause the
dumping duty, to be levied,
collected and paid, as
discharged only upon
payment of duties, taxes,
fees and other charges. It
also constitutes alien on the
imported goods which may
be enforced while such
goods are under customs'
custody.
SBC. 406. Importations by
the Government. – Except
those provided for in Section
800 of this Act, all
importations by the
government for its own use or
that of its subordinate
branches or instrumentalities,
or corporations, agencies or
instrumentalities owned or
controlled by the government,
shall be subject to the duties,
taxes, fees and other charges
under this Act.
Sec. 407. Goods Declaration
and Period of Filing. . – As far
as practicable, the format of
the goods declaration shall
conform with international
standards. The data required
in the goods declaration shall
be limited to such particulars
that are deemed necessary
for the assessment and
collection of duties and taxes,
the compilation of statistics
and compliance with this Act.
The Bureau shall require the
electronic lodgement of the
goods declaration.
 (c) The amount of any
import duties imposed by the
country of exportation which
have been rebated, or which
have not been collected, by
reason of the exportation of
the article to the Philippines;
and
. subsequently imported under
(d) The amount of any
taxes imposed in the country
of exportation upon the
manufacturer, producer or
seller, in respect to the
manufacture, production or
sale of the article, which have
been rebated, or which have
not been collected, be reason
of the exportation of the
article of the Philippines.
. .
Any additional costs,
charges and expenses
incident to bringing the article
from the place of shipment in
the country of exportation to
the place of delivery in the
Philippines and Philippine
customs duties imposed
thereon shall not be included.
3. The "exporter's sale
price" of an imported article
shall be the price at which
such article is sold or agreed
to be sold in the Philippines,
before or after the time of
exportation, by or for the
account of the exporter,
including —
addition to any other duties,
taxes and charges as
prescribed in this section,
addition to any other duties,
taxes and charges imposed
by law on such article, and on
the articles of the same
specific kind or class
similar circumstances coming
from the specific country.
d. The "Dumping Duty" as
provided for in sub-section
"c" hereof shall be equal to
the difference between the
actual purchase price and the
fair value of the article as
determined in the dumping
decision. All importations of
like articles within sixty
(60)days immediately
preceding the filing of the
protest are covered by the
investigation. However, in
cases of subsequent
importations of the same kind
or class of article from the
specific country named in the
protest, the dumping duty
shall be equal to the
difference between the actual
purchase price and the fair
value actually existing at the
time of importation as
determined by the Tariff
Commission from the
supporting documents
submitted or from other
reliable sources.
The Bureau shall only require
supporting documents
necessary for customs
control to ensure that all
requirements of the law have
been complied with.
Translation of supporting
documents shall not be
required except when
necessary.
Goods declaration must be
lodged within fifteen (15)
days from the date of
discharge of the last package
from the vessel or aircraft.
The period to file the goods
declaration may, upon
request, be extended on valid
grounds for another fifteen
(15) days: Provided, That the
request is made before the
expiration of the original
period within which to file the
goods declaration: Provided,
however, That the period of
the lodgement of the goods
declaration maybe adjusted
by the Commissioner.
Sec. 408. Lodgement and
Amendment of Goods
Declaration. – The Bureau
shall permit the electronic
lodgement of the goods
declaration at any designated
customs office. The Bureau
shall, for valid reason and
under terms and conditions
provided by regulation, permit
the declarant to amend the
goods declaration that has
 (a) The cost of all
containers and coverings and
all other costs, charges and
expenses incident to placing
the article in condition,
packed ready for shipment to
the Philippines;
..
(b) The amount of any
import duties imposed by the
country of exportation which
have been rebated, or which
have not been collected, by
reason of the exportation of
the article to the Philippines;
and
. Tax Appeals in the same
(c) The amount of any
taxes imposed in the country
of exportation upon the
manufacturer, producer or
seller in respect to the
manufacture, production or
sale of the article, which have
been rebated, or which have
not been collected, by reason
of its exportation to the
Philippines. The following
amount, if included, shall be
deducted —
(1) The amount of
costs, charges and
expenses, and Philippine
customs duties, incident to
bringing the article from the
place of shipment in the
country of exportation to the
place of delivery in the
Philippines;
. presentation of landing
e. Pending investigation
and final decision of the case,
the article in question, and
articles of the same specific
kind or class subsequently
imported under similar
circumstances, shall be
released to the owner,
importer, consignee or agent
upon the giving of a bond in
an amount equal to twice the
estimated dutiable value
thereof.
f. Any aggrieved party may
appeal only the amount of the
dumping duty to the Court of
manner and within the same
period provided for by law in
the case of appeal from
decision of the Commissioner
of Customs.
g. (1) The article, if it has
not been previously released
under bond as provided for in
subsection "e" hereof, shall
be released after payment by
the party concerned of the
corresponding dumping duty
in addition to any ordinary
duties, taxes, and charges, if
any, or re-exported by the
owner, importer, consignee
or agent, at his option and
expense, upon the filing of a
bond in an amount equal to
twice the estimated dutiable
value of the article,
conditioned upon
certificate issued by a
already been lodged:
Provided, That the request to
amend the goods declaration,
together with the intended
amendments, must be
received prior to final
assessment or examination
of the goods.
Sec. 409. Advance
Lodgement and Clearance. –
The Bureau may provide for
the lodgement and clearance
of goods declaration and
supporting documents prior
to the arrival of the goods
under such terms and
conditions as may be
provided by rules and
regulations to be
promulgated under this Act.
Sec. 410. Entry of Goods in
Part for Consumption and in
Part for Warehousing. –
Goods declaration covered
by one bill of lading or airway
bill over goods which are
meant in part for
consumption and in part for
warehousing may be both
entered simultaneously for
release at the port of entry.
Sec. 411. Contents of Goods
Declaration. – Goods
declaration shall contain the
names of the consignee,
importing vessel or aircraft
port of departure, port of
destination and date of
arrival, the number and
 (2) The amount of
commissions, if any, for
selling in the Philippines the
particular article under
consideration;
. previously released under
(3)An amount equal
to the expenses, if any,
generally incurred by or for
the account of the exporter in
the Philippines in selling
identical or substantially
identical article; and
. any.
(4) The amount of any
export tax paid in the country
of exportation on the
exportation of the article to
the Philippines.
4. The "foreign market
value" of an imported article
shall be the price, at the time
of exportation of such article
to the Philippines, at which
such or similar article is sold
or freely offered for sale to all
purchasers in the principal
markets of the country from
which exported, in the usual
wholesale quantities and in
the ordinary course of trade
for home consumption (or, if
not sold or offered for sale for
home consumption, then for
exportation to countries other
than the Philippines),
including the cost of all
containers and coverings and
all other costs, charges and
expenses incident to placing
the article in condition packed
consular officer of the
Philippines at the country of
destination; or
(2) If the article has been
bond, as provided in
subsection "e" hereof, the
party concerned shall be
required to pay the
corresponding dumping duty
in addition to any ordinary
duties, taxes and charges, if
h. Any investigation to be
conducted by the
Commission under this
section shall include a public
hearing or hearings where
the importer, consignee or
agent, of the imported article,
the local producers of a like
article, other parties directly
affected, and such other
parties as in the judgment of
the Commission are entitled
to appear, shall be given an
opportunity to be heard and
to present evidence bearing
on the subject matter.
i. The established dumping
duty shall be subject to
adjustment based on the
prevailing home consumption
price or the exporter's sales
price to third country or the
home consumption price of a
proxy country or in the
absence thereof, the cost of
production. The Commission
marks of packages, or the
quantity, if in bulk, the nature
and correct commodity
description of the goods
contained therein, its value
as set forth in a proper
invoice, and such other
information as may be
required by rules and
regulations. Where the
declarant does not have all
the information required to
make the goods declaration,
a provisional or incomplete
goods declaration shall, for
certain cases and for reasons
deemed valid by the Bureau,
be allowed to be lodged:
Provided, That it contains the
particulars deemed
necessary by the Bureau for
the acceptance of the entry
filed and that the declarant
undertakes to complete it
within forty-five (45) days
from the filing of the
provisional goods declaration
in accordance with Section
403 of this Act
Sec. 412. Statements to be
Provided in the Goods
Declaration. – No entry of
imported goods shall be
allowed unless the goods
declaration has been lodged
with the Bureau. The goods
declaration shall, under
penalties of falsification or
perjury, contain the following
statements:
ready for shipment to the shall conduct quarterly (a) The invoice and goods
Philippines, except that in the examination and/or declaration contain an
case of articles purchased or verification of the fair value to accurate and faithful account
agreed to be purchased by determine the necessity of of the prices paid or payable
the person by whom or for adjustment. Should the for the goods and other
whose account the article is Secretary, upon receipt of the adjustments to the price
imported, prior to the time of report of the Commission, actually paid or payable, and
exportation, the foreign find that there is a need for that nothing has been omitted
market value shall be an adjustment he shall direct therefrom or concealed
ascertained as of the date of the commissioner of Customs whereby the government of
such purchase or agreement to effect the necessary the Republic of the
to purchase. In the adjustment in dumping duty. Philippines might be
ascertainment of foreign defrauded of any part of the
market value for the purpose The Philippines Finance duties and taxes lawfully due
of this section, no pretended Attache or, in the absence on the goods; and
sale or offer for sale, and no thereof, the Commercial
sale or offer for sale intended Attache or, in the absence (b) To the best of the
to establish a fictitious thereof, the diplomatic officer declarant's information and
market, shall be taken into and/or consular officer belief, all the invoices and
account. abroad shall be advised by bills of lading or airway bills
. the Secretary of any article relating to the goods are the
5. The "cost of production" covered by dumping only ones in existence
of an imported article shall be decision. The concerned relating to the importation in
the sum of — Attache or the Officer shall question, and that these
submit quarterly report on documents are in the same
(a) The cost of materials home consumption prices, or state as when they were
of, and of fabrication, in the absence thereof, the received by the declarant,
manipulation or other process cost of production, of said and the declaration thereon
employed in manufacturing or articles to the Secretary and are in all respects genuine
producing, identical or the Commission, thru the and true.
substantially identical article, department head.
at a time preceding the date Goods declaration shall be
of shipment of the particular j. Whenever the submitted electronically
article under consideration Commission, on its own pursuant to Republic Act No.
which would ordinarily permit motion or upon the 8792, otherwise known as
the manufacture or application of any interested the "Electronic Commerce
production of the particular party, finds that any of the Act of 2000". Such
article under consideration in conditions which declarations when printed
the usual course of business; necessitated the imposition of and certified by a competent
the dumping duty has ceased customs officer as a faithful
(b) The usual general to exist, it shall submit the reproduction of the electronic
expenses not less than 10 necessary recommendation submission shall be
per cent of such cost, in the
case of identical or
substantially identical articles;
. .
(c) The cost of all
containers and coverings,
and all other costs, charges
and expenses incident to
placing the particular article
under consideration in
condition, packed ready for
shipment to the Philippines;
and
. shall be effective for a period
(d) An addition for profit
not less than 8 per cent of the
sum of the amounts
determined under
subparagraphs (a) and (b)
hereof, equal to the profit
which is originally added, in
the case of articles of the
same general character as
the particular article under
consideration, by
manufacturers or producers
in the country of manufacture
or production who are
engaged in the same general
trade as the manufacturer or
producer of the particular
article under consideration.
. The findings of the
f. For the purposes of
this section the "exporter" of
an imported article shall be
the person by whom or for
whose account the article is
imported into the Philippines
— any dumping decision for five
to the Secretary for the
discontinuance or
modification of such dumping
duty. Any decision or order
made under this section by
the Secretary shall be
published in the Official
Gazette and/or in a
newspaper of general
circulation.
k. Any dumping decision
promulgated by the Secretary
of five years from the time of
its promulgation except upon
the representation of the
interested party of the
necessity to continues the
implementation of said
decision, in which case the
Secretary shall advice the
Commission to conduct an
investigation to determine
whether the conditions in
paragraphs b-1 and b-2 still
exist. The action for
extension shall be brought
before the Secretary at least
six (6) months before the
expiration of the period.
Commission shall be
submitted to the Secretary at
least three (3) months before
the expiration of the period.
[All industries protected by
years or more from the time
of its promulgation may apply
considered as actionable
documents for purposes of
prosecuting a declarant if the
declarations are found to be
fraudulent.
Sec. 413. Description of
Goods. – Under such terms
and conditions prescribed
under the rules and
regulations, the description of
the goods in the goods
declaration must be sufficient
and specific in detail to
enable the goods to be
identified for customs
valuation, statistical
purposes, and classification
to the appropriate tariff
heading and subheading in
the currency of the invoice,
and in such other particulars
necessary for the proper
assessment and collection of
duties and taxes. The
quantity and value of each of
the several classes of goods
shall be separately declared
according to their respective
headings or subheadings and
the totals of each heading or
subheading shall be duly
shown.
Sec. 414. Commercial and
Noncommercial Invoice. –
Commercial invoice of
imported goods shall contain
the following:
(a) The agreed price paid or
to be p aid for the goods;
 1. If such person is
the agent or principal of the
exporter, manufacturer or
producer; or
2. If such person
owns or controls, directly or
indirectly, through stock
ownership or control or
otherwise, any interest in the
business of the exporter,
manufacturer or producer; or
. respective functions under
3. If the exporter,
manufacturer or producer
owns or controls, directly or
indirectly, through stock
ownership or control or
otherwise, any interest in any
business conducted by such
persons; or
. description, in customary
4. If any person or
persons, jointly or severally,
directly or indirectly, through
stock ownership or control or
otherwise, own or control in
the aggregate 20 per cent or
more of the voting power or
control in the business
carried on by the person by
whom or for whose account
the article is imported into the
Philippines, and also 20 per
cent or more of such power
or control in the business of
the exporter, manufacturer or
producer.
g. Pending investigation
and final decision of the case,
the article in question, and
for extension to the Secretary
within six (6) months from
effectivity of this Decree. The
decision shall be deemed
terminated upon failure to file
the application within the
period so provided.]
l. The Secretary and the
Commission shall promulgate
all rules and regulations
necessary to carry out their
this Section.
(b) The adjustments to the
price paid or to be paid as
defined in Section 701(1) of
this Act, if not yet included in
the invoice, as may be
applicable;
(c) The names of the buyer,
seller, and the time and place
of sale;
(d) The port of entry;
(e) A sufficient description to
enable the accurate
identification of goods for
tariff classification, customs
valuation, and statistical
purposes, indicating the
correct commodity
term or commercial
designation, the grade or
quality, numbers, marks or
symbols under which they
are sold by the seller or
manufacturer, together with
the marks and number of
packages in which the goods
are packed;
(f) The quantities in the
weights or measures of the
goods shipped; and
(g) Any other fact deemed
necessary for the proper
examination, customs
valuation, and tariff
classification of the goods as
articles of the same specific
kind or class subsequently
imported under similar
circumstances, shall be
released to the owner,
importer, consignee or agent
upon the giving of a bond in
an amount equal to the
double the estimated value
thereof. Articles which may
have been delivered under
the provision of section
fifteen hundred and three of
this Code prior to the
institution of the investigation
provided in this section shall,
pending final decision, be
ordered returned to the
custody of the collectors of
customs unless released
under bond in accordance
with this section.
h. Any aggrieved party
may only appeal the amount
of dumping duty that is levied
and collected by the
Commissioner of Customs to
the Court of Tax Appeals in
the same manner and within
the same period provided for
by law in the case of appeals
from decisions of the
Commissioner of Customs.
.
i. (1) The article, if it has
not been previously released
under bond as provided in
subsection "g" hereof, shall
be released after payment by
the party concerned of the
corresponding dumping duty
may be prescribed by rules
and regulations.
To the extent possible, the
above requirements shall
also apply to goods imported
but not covered by sale, such
as goods on consignment or
lease, samples, or donations,
covered by a consignment,
pro forma invoice, or other
noncommercial invoice.
Sec. 415. Mode of Payment
and Terms of Trade. –
Subject to existing laws and
rules on foreign currency
exchange, the internationally
accepted standards and
practices on the mode of
payment or remittance
covering import and export
transactions, including
standards developed by
international trading bodies
such as the International
Chamber of Commerce (ICC)
on trading terms (incoterms)
and on international letters of
credit such as the Uniform
Customs and Practice for
Documentary Credits
(UCPDC), shall be
recognized.
Sec. 416. Examination of
Samples. – Customs officers
shall see to it that
representative samples taken
during examination shall be
properly receipted for and
retained within a reasonable
in addition to any other
duties, taxes and charges, if
any, or re-exported by the
owner, importer, consignee
or agent, at his option and
expense, upon the filing of a
bond in an amount equal to
double the estimated value of
the article, conditioned upon
the presentation of a landing
certificate issued by a
consular officer of the
Philippines at the country of
destination; or
(2) If the article has
been previously released
under bond, as provided in
subsection "g" hereof, the
party concerned shall be
required to pay the
corresponding dumping done
in addition to any other
duties, taxes and charges, if
any.
j. Any investigation to be
conducted by the
Commission under this
section shall include a
hearing or hearings where
the owner, importer,
consignee or agent of the
imported article, the local
producers of a like article,
other parties directly affected,
and such other parties as in
the judgment of the
Commission are entitled to
appear, shall be given an
opportunity to be heard and
Sec. 302. Countervailing
Duty. —
a. Whenever any article is
directly or indirectly granted
any bounty, subsidy or
subvention upon its
production, manufacture or
exportation in the country of
origin and/or exportation, and
the importation of which has
been determined by the
Secretary, after investigation
and report of the
Commission, as likely to
injure an established
industry, or prevent or
considerably retard the
establishment of an industry
in the Philippines, there shall
be levied a countervailing
duty equal to the ascertained
or estimated amount of such
bounty, countervailing duty
period of time. The quantity
and value of the samples
taken shall be noted in the
specified box of goods
declaration or electronic form.
Such samples shall be duly
labeled as will definitely
identify them with the
importation for which they are
taken.
Sec. 417. Forwarding of
Cargo and Remains of
Wrecked Vessel or Aircraft. –
When vessels or aircrafts are
wrecked within the
Philippines, the original
owners or consignees of the
cargo, or by its underwriters,
in ease of abandonment, may
seek approval from the
Bureau to forward the goods
saved from the wreck to the
ports of destination without
going through, the customs
office in the district in which
the goods were cast ashore
or unloaded. Upon approval,
the goods may be forwarded
with particular manifests and
duly certified by a customs
officer in charge of the goods.
The owner of the vessel or
aircraft may be permitted to
export the remains of the
wreck upon proper
examination and inspection.
The remains of a wrecked
vessel shall include not only
its hull and rigging, but also
all sea stores, goods and
to present evidence bearing
on the subject matter.
. bounty, subsidy or
k. It shall be the duty of
collectors of customs at all
ports of entry to levy and
collect the dumping duty in
accordance with subsection
"d" hereof on the specific kind
or class of article as to which
the Secretary has made a
decision of dumping.
. exported article from duty or
It shall also be their duty
to bring to the attention of the
Secretary, thru the
Commissioner of Customs,
any case coming within their
notice which may, in their
opinion, require action as
provided in this section.
. the meaning of this
l. The Secretary shall
promulgate all rules and
regulations necessary to
carry out the provisions of
this section.
Sec. 302. Countervailing
Duty. — a. On articles
dutiable under this Code,
upon the production,
manufacture or export of
which any bounty, subsidy or
subvention is directly or
indirectly granted in the
country of origin and/or
exportation, and the
importation of which has
been determined by the
Secretary, after investigation
and report of the
equal to the ascertained or
estimated amount of such
subvention: Provided, That
the injury criterion to a
domestic industry shall be
applied only in case of
imports from countries which
adhere to the GATT Code on
Subsidies and Countervailing
Duties; Provided further, That
the exemption of any
tax imposed on like articles
when destined for
consumption in the country of
origin and/or exportation or
the refunding of such duty or
tax, shall not be deemed to
constitute a grant of a bounty,
subsidy or subvention within
subsection: Provided,
furthermore, That should an
article be allowed drawback
by the country of origin
and/or exportation, only the
ascertained or estimated
excess of the amount of the
drawback over the total
amount of the duties and/or
internal taxes, if any, shall
constitute a bounty, subsidy
or subvention: Provided,
finally, That petitions for
imposition of countervailing
duty shall be filed with the
Secretary of Finance. Upon
finding of a prima facie case
of bounty, subsidy or
subvention enjoyed by the
imported article and injury to,
equipment, such as sails,
ropes and chain anchors.
Sec. 418. Derelicts and
Goods from Abandoned
Wrecks. – Derelicts and all
goods recovered from sea or
from abandoned wrecks shall
be under the jurisdiction of
the port where the goods
arrive, and shall be retained
in the custody of the Bureau.
If not claimed by the owner,
underwriter or salvor, the
same shall be deemed as
property of the government.
When such goods are
brought into port by lighters
or other craft, each vessel
shall submit a manifest of
their respective cargo.
The customs officer nearest
the scene of the wreck shall
take charge of the goods
saved and shall give
immediate notice to the
District Collector or the
nearest customs office.
In order to prevent any
attempt to commit fraud, the
District Collector shall be
represented at the salvage of
the cargo by customs officers
who shall examine and
receive the inventory made
on the cargo.
Derelicts and goods salvaged
from foreign vessels or
Commission, as likely to
materially injure an
established industry, or
prevent or considerably
retard the establishment of
an industry in the Philippines,
there shall be levied a
countervailing duty equal to
the ascertained or estimated
amount of such bounty,
subsidy or subvention:
Provided, That the exception
of any exported article from a
duty or tax imposed on like
articles when destined for
consumption in the country of
origin and/or exportation or
the refunding of such duty or
tax, shall not be deemed to
constitute a grant of a bounty,
subsidy or subvention within
the meaning of this section;
however, should an article be
allowed drawback by the
country of origin and/or
exportation, only the
ascertained or estimated
excess of the amount of the
drawback over the total
amount of the duties and/or
internal taxes, if any, shall
constitute a bounty, subsidy
or subvention.
. same specific kind or class
b. The Commission, on its
own motion or upon
application of any interested
party, when in its judgment
there is good and sufficient
reason therefor, shall
ascertain, determine or
estimate the net amount of
or likelihood of injury to a
domestic industry, the
Secretary shall refer the case
to the Tariff Commission for
investigation for investigation
and shall instruct the
Commissioner of Customs to
require the filing of
countervailing bonds for
importations entered during
the pendency of
countervailingproceedings;
b. The Secretary shall,
after receipt of the reports of
the Commission, decide
whether the article in
question is granted any
bounty, subsidy or
subvention and if so, fix the
countervailing duty equal to
the ascertained or estimated
bounty, subsidy or
subvention. He shall give due
notice of his decision and
shall direct the Commissioner
of Customs to cause the
countervailing duty to be
levied, collected and paid in
addition to any ordinary
duties, taxes and charges
imposed by law on such
articles and on articles of the
subsequently imported under
similar circumstances;
c. Pending investigation
and final decision of the case,
the article in question shall
not be released from customs
custody to the owner except
upon the filing of a bond
aircrafts recovered from sea
or wreck are prima facie
dutiable and may be entered
for consumption or
warehousing. If claimed to be
of Philippine production, and
consequently conditionally
duty-free, proof must be
submitted as in ordinary
cases of reimportation of
goods. Foreign goods landed
from a vessel or aircraft in
distress is dutiable if sold or
disposed of in the
Philippines.
Before any goods taken from
a recent wreck are admitted
to the customs territory, the
same shall be appraised, and
the owner or importer shall
have the same right to appeal
as in ordinary importation.
No part of a Philippine vessel
or aircraft or its equipment,
wrecked either in Philippine
or foreign waters, shall be
subject to duty.
CHAPTER 2
EXAMINATION OF GOODS
Sec. 419. Examination of
Goods. – Examination of
goods, when required by the
Bureau, shall be conducted
immediately after the goods
declaration has been lodged.
Priority in the examination
shall be given to live animals,
such bounty, subsidy or
subvention and shall transmit
to the Secretary the amounts
so ascertained, determined
or estimated, if any.
Wherever it is ascertained
that the conditions which
necessitated the imposition of
the countervailing duty have
ceased to exist, and the
Commission shall so certify
to the Secretary, the latter
shall take the necessary
steps to suspend or
discontinue the imposition of
such duty.
c. The Secretary shall make
all rules and regulations
necessary to carry out the
provisions of this section.
equal to the ascertained or
estimated amount of bounty,
subsidy or subvention as
provisionally determined by
the Secretary of Finance;
d. The article, if not
previously released under
bond as provided for in this
section, shall be released
after payment by the party
concerned of the
corresponding countervailing
duty in addition to any
ordinary duties, taxes and
charges, if any, or re-
exported upon the filing of a
bond in an amount twice the
estimated dutiable value of
the article, conditioned upon
the presentation of a landing
certificate issued by a
consular officer of the
Philippines at the country of
destination. If the article has
been previously released
under bond, the party
concerned shall be required
to pay the corresponding
countervailing duty in addition
to ordinary duties, taxes and
other charges, if any;
e. Whenever the
Commission, on its motion or
upon application of any
interested party, finds that the
condition which necessitated
the imposition of the
countervailing duty has
ceased to exist, it shall
submit the necessary
perishable goods and other
goods requiring immediate
examination.
Whenever necessary, a
system of coordination and
joint examination of goods
shall be established by the
Bureau and other regulatory
agencies under existing laws
and regulations.
As a general rule, the Bureau
may examine the goods in
the presence of the declarant
or an authorized
representative. Examination
of the goods in the absence
of the declarant or authorized
representative may be
allowed in exceptional
circumstance and for valid
and justifiable grounds, as
may be defined by
regulations promulgated by
the Secretary of Finance,
upon recommendation of the
Commissioner. The Bureau
may require the declarant to
be present or to be
represented at the
examination of the goods or
to render any assistance
necessary to facilitate the
examination.
The Bureau shall take
samples of the goods only
when needed to establish the
tariff description and value of
goods declared, or to ensure
compliance with this Act.
recommendations to the
Secretary for the
discontinuance of the
imposition of that duty. Any
order made under this
section by the Secretary shall
be published in the Official
Gazette and/or in a
newspaper of general
circulation;
f. Any countervailing
decision promulgated by the
Secretary shall be effective
for a period of five (5) years
from the time of its
promulgation except upon the
representation of the
interested party of the
necessity to continue the
implementation of said
decision, in which case the
Secretary shall advise the
Commission to conduct an
investigation to determine
whether the conditions in
paragraph "a" still exist. The
action for extension shall be
brought before the Secretary
at least six (6) months before
the expiration of the period.
The findings of the
Commission shall be
submitted to the Secretary at
least three (3) months before
the expiration of the period.
g. The Secretary and the
Commission shall promulgate
all rules and regulations
necessary to carry out their
Samples drawn shall be as
minimal as possible.
Sec. 420. Conditions for
Examination.. – Pursuant to
internationally accepted
standards, the Bureau may
adopt nonintrusive
examination of goods, such
as the use of x-ray machines.
Physical examination of the
goods shall be conducted
when:
(a) It is directed by the
Commissioner on account of
a derogatory information;
(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 and
controversies surrounding the
goods declaration and the
import clearance process; or
(e) The importer or declarant
requests for the examination
of the goods.
The Commissioner may
exempt from physical
examination the goods of
authorized economic
operators or of those
provided for under any
respective functions under
this section.
Sec. 303. Marking of
Imported Articles and
Containers. —
a. Marking of Articles. —
Except as hereinafter
provided, every article of
foreign origin (or its
container, as provided in
subsection "b" hereof)
imported into the Philippines
shall be marked in any official
language of the Philippines
and in a conspicuous place
as legibly, indelibly and
permanently as the nature of
the article (or container) will
permit in such manner as to
indicate to an ultimate
purchaser in the Philippines
the name of the country of
origin of the article. The
Commissioner of Customs
shall, with the approval of the
department head, issue rules
and regulations to —
1. Determine the
character of words and
phrases or abbreviation
thereof which shall be
acceptable as indicating the
country of origin and
prescribe any reasonable
method of marking, whether
by printing, stenciling,
stamping, branding, labelling
or by any other reasonable
existing trade facilitation
program of the Bureau.
Physical examination, when
required, shall be conducted
in an expeditious manner.
Sec. 421. Duties of Customs
Officer Tasked to Examine
the Imported Goods., – In the
examination, classification,
and valuation of the goods,
the customs officer shall:
(a) Determine whether the
packages for examination
and their contents are in
accordance with the goods
declaration, invoice and other
pertinent documents;
(b) Take samples of the
imported goods for
examination or laboratory
analysis when necessary;
(c) Issue a receipt for a
sample taken and retained
during examination; and
(d) Report whether the goods
have been correctly declared
as to value, quantity,
measurement, weight, tariff
classification and not
imported contrary to law.
Failure on the part of the
customs officer to perform
the above duties shall be
penalized according to

Sec. 303. Marking of
Imported Articles and
Containers. — a. Marking of
Articles. — Except as
hereinafter provided, every
article of foreign origin (or its
container, as provided in
subsection "b" hereof)
imported into the Philippines
shall be marked in any official
language of the Philippines
and in a conspicuous place
as legibly, indelibly and
permanently as the nature of
the article (or container) will
permit in such manner as to
indicate to an ultimate
purchaser in the Philippines
the name of the country of
origin of the article. The
Commissioner of Customs
shall, with the approval of the
department head, issue rules
and regulations to —
(1) Determine the
character of words and
phrases or abbreviations
thereof which shall be
method, and a conspicuous
place on the article or
container where the marking
shall appear.
2. Require the addition
of any other words or
symbols which may be
appropriate to prevent
deception or mistake as to
the origin of the article or as
to the origin of any other
article with which such
imported article is usually
combined subsequent to
importation but before
delivery to an ultimate
purchaser; and
3. Authorize the
exception of any article from
the requirements of marking
if -
a. Such article is
incapable of being marked;
b. Such article cannot
be marked prior to shipment
to the Philippines without
injury;
c. Such article cannot
be marked prior to shipment
to the Philippines, except at
an expense economically
prohibitive of its importation;
d. The marking of a
container of such article will
reasonably indicate the origin
of such article;
Section 1431 of Title XIV of
this Act.
Sec. 422. Customs Expenses
Constituting Charges on
Goods. – The cost of
examination shall be for the
account of the importer or
exporter, subject to proper
accounting and
documentation. All expenses
incurred by the Bureau for
the handling or storage of
goods and other necessary
operations shall be
chargeable against the
goods, and shall constitute a
lien thereon.
CHAPTER 3
ASSESSMENT AND
RELEASE
Sec. 423. Determination of
the De Minimis Value. – No
duties and taxes shall be
collected on goods with an
FOB or FCA value often
thousand pesos (P10,000.00)
or below. The Secretary of
Finance shall adjust the de
minimis value as provided
herein every three (3) years
after the effectivity of this Act.
The value herein stated shall
be adjusted to its present
value using the CPI, as
published by the PSA.
Sec. 424. Duty of Customs
Officer Tasked to Assess
acceptable as indicating the
country of origin and
prescribe any reasonable
method of marking, whether
by printing, stenciling,
stamping, branding, labeling
or by any other reasonable
method, and a conspicuous
place on the article or
container where the marking
shall appear;
. by the importer or for his
(2) Require the addition of
any other words or symbols
which may be appropriate to
prevent deception or mistake
as to the origin of the article
or as to the origin of any
other article with which such
imported article is usually
combined subsequent to
importation but before
delivery to an ultimate
purchaser; and
. .
(3) Authorize the exception
of any article from the
requirements of marking if —
(a) Such article is
incapable of being marked;
(b) Such article cannot
be marked prior to shipment
to the Philippines without
injury;
(c) Such article cannot
be marked prior to shipment
to the Philippines, except at
an expense economically
prohibitive of its importation;
e. Such article is a
crude substance;
f. Such article is
imported for use by the
importer and not intended for
sale in its imported or any
other form;
g. Such article is to be
processed in the Philippines
account otherwise than for
the purpose of concealing the
origin of such article and in
such manner that any mark
contemplated by this section
would necessarily be
obliterated, destroyed or
permanently concealed;
h. An ultimate
purchaser, by reason of the
character of such article or by
reason of the circumstances
of its importation must
necessarily know the country
of origin of such article even
though it is not marked to
indicate its origin;
i. Such article was
produced more than twenty
years prior to its importation
into the Philippines; or
j. Such article cannot
be marked after importation
except at an expense which
is economically prohibitive,
and the failure to mark the
article before importation was
Imported Goods. – For
purposes of assessing duties
and taxes on imported goods,
the customs officer shall
classify, value, and determine
the duties and taxes to be
paid. The customs officer
shall prepare and submit an
assessment report as
established under this Act.
Sec. 425. Tentative
Assessment of Goods
Subject to Dispute
Settlement. – Assessment
shall be deemed tentative if
the duties and taxes initially
assessed are disputed by the
importer. The assessment
shall be completed upon final
readjustment based on the
tariff ruling in case of
classification dispute, or the
final resolution of the protest
case involving valuation,
rules of origin, and other
customs issues.
The District Collector may
allow the release of the
imported goods under
tentative assessment upon
the posting of sufficient
security to cover the
applicable duties and taxes
equivalent to the amount that
is disputed.
Sec. 426. Tentative
Assessment of Provisional
Goods Declaration. –
Assessment of a provisional
 . not due to any purpose of the
(d) The marking of a
container of such article will
reasonably indicate the origin
of such article;
. .
(e) Such article is a
crude substance;
. .
(f) Such article is
imported for use by the
importer and not intended for
sale in its imported or any
other form;
. .
(g) Such article is to be
processed in the Philippines
by the importer or for his
account otherwise than for
the purpose of concealing the
origin of such article and in
such manner that any mark
contemplated by this section
would necessarily be
obliterated, destroyed or
permanently concealed;
. provisions of this section,
(h) An ultimate
purchaser, by reason of the
character of such article or by
reason of the circumstance of
its importation, must
necessarily know the country
of origin of such article even
though it is not marked to
indicate its origin;
. subsection "b" hereof), is not
(i) Such article was
produced more than twenty
years prior to its importation
into the Philippines; or
. article a marking duty of 5 per
importer, producer, seller or
shipper to avoid compliance
with this section.
b. Marking of Containers.
— Whenever an article is
excepted under subdivision
(3) of subsection "a" of this
section from the
requirements of marking, the
immediate container, if any,
of such article, or such other
container or containers of
such article as may be
prescribed by the
Commissioner of Customs
with the approval of the
department head, shall be
marked in such manner as to
indicate to an ultimate
purchaser in the Philippines
the name of the country of
origin of such article in any
official language of the
Philippines, subject to all
including the same
exceptions as are applicable
to articles under subdivision
(3) of subsection "a".
c. Marking Duty for Failure
to Mark. — If at the time of
importation any article (or its
container, as provided in
marked in accordance with
the requirements of this
section, there shall be levied,
collected and paid upon such
goods declaration shall be
deemed tentative and such
assessment shall be
completed upon final
readjustment and submission
by the declarant of the
additional information or
documentation required to
complete the declaration
within the period provided in
Section 403 of this Act.
Sec. 427. Readjustment of
Appraisal, Classification or
Return. – Such appraisal,
classification or return, as
finally passed upon and
approved or modified by the
District Collector, shall not be
altered or modified in any
manner, except:
(1) Within one (1) year after
payment of the duties, upon
statement of error in
conformity with Section 912
of this Act, as approved by
the District Collector;
(2) Within fifteen (15) days
after such payment, upon
request for reappraisal or
reclassification addressed to
the Commissioner by the
District Collector, if the
appraisal or classification is
deemed to be low;
(3) Upon request for
reappraisal and/or
reclassification, in the form of
a timely protest addressed to
 (j) Such article cannot
be marked after importation
except at an expense which
is economically prohibitive,
and the failure to mark the
article before importation was
not due to any purpose of the
importer, producer, seller or
shipper to avoid compliance
with this section.
b. Marking of Containers. —
Whenever an article is
excepted under subdivision
(3) of subsection "a" of this
section from the
requirements of marking, the
immediate container, if any,
of such article, or such other
container or containers of
such article as may be
prescribed by the
Commissioner of Customs
with the approval of the
department head, shall be
marked in such manner as to
indicate to an ultimate
purchaser in the Philippines
the name of the country of
origin of such article in any
official language of the
Philippines, subject to all
provisions of this section,
including the same
exceptions as are applicable
to articles under subdivision
(3) of subsection "a".
c. Marking Duty for Failure to
Mark. — If at the time of
cent ad valorem, which shall
be deemed to have accrued
at the time of importation,
except when such article is
exported or destroyed under
customs supervision and
prior to the final liquidation of
the corresponding entry.
d. Delivery Withheld Until
Marked. — No imported
article held in customs
custody for inspection,
examination or appraisement
shall be delivered until such
article and/or its containers,
whether released or not from
customs custody, shall have
been marked in accordance
with the requirements of this
section and until the amount
of duty estimated to be
payable under subsection "c"
of this section shall have
been deposited. Nothing in
this section shall be
construed as excepting any
article or its container from
the particular requirements of
marking provided for in any
provision of law.
e. The failure or refusal of
the owner or importer to mark
the articles as herein required
within a period of thirty days
after due notice shall
constitute as an act of
abandonment of said articles
and their disposition shall be
governed by the provisions of
the District Collector by the
interested party if the latter
should be dissatisfied with
the appraisal or return; or
(4) Upon demand by the
Commissioner after the
completion of compliance
audit in accordance with the
provisions of this Act.
Sec. 428. Assessment of
Duty on Less Than Entered
Value. – Duty shall not be
assessed in any case upon
an amount less than the
entered value, unless by
direction of the
Commissioner in cases when
the importer certifies at 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 increases made by
the appraiser in similar cases
then pending re-
appraisement; and the lower
assessment shall be allowed
only when the importer's
contention is 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.
– Assessment shall be
deemed final fifteen (15) days
after receipt of the notice of
importation any article (or its
container, as provided in
subsection "b" hereof), is not
marked in accordance with
the requirements of this
section, there shall be levied,
collected and paid upon such
article a marking duty of 5 per
cent ad valorem, which shall
be deemed to have accrued
at the time of importation,
except when such article is
exported or destroyed under
customs supervision and
prior to the final liquidation of
the corresponding entry.
. articles wholly or in part the
d. Delivery Withheld until
Marked. — No imported
article held in customs
custody for inspection,
examination or appraisement
shall be delivered until such
articles and/or their
containers, whether released
or not from customs custody,
shall have been marked in
accordance with the
requirements of this section
and until the amount of duty
estimated to be payable
under subsection "c" of this
section shall have been
deposited. Nothing in this
section shall be construed as
excepting any article or its
container from the particular
requirements of marking
provided for in any provisions
of law.
. .
this Code relative to
abandonment of imported
articles.
Sec. 304. Discrimination by
Foreign Countries. —
a. The President, when he
finds that the public interest
will be serves thereby, shall
by proclamation specify and
declare new or additional
duties in an amount not
exceeding one hundred (100)
per cent ad valorem upon
growth or product of, or
imported in a vessel of, any
foreign country whenever he
shall find as a fact that such
country —
1. Imposes, directly or
indirectly, upon the
disposition or transportation
in transit through or re-
exportation from such country
of any article wholly or in part
the growth or product of the
Philippines, any
unreasonable charge,
exaction, regulation or
limitation which is not equally
enforced upon the like
articles of every foreign
country; or
2. Discriminates in fact
against the commerce of the
Philippines, directly or
indirectly, by law or
assessment by the importer
or consignee.
Sec. 430. Period of
Limitation. – In the absence
of fraud and when the goods
have been finally assessed
and released, the
assessment shall be
conclusive upon all parties
three (3) years from the date
of final payment of duties and
taxes, or upon completion of
the post clearance audit.
Sec. 431. Release of Goods
after Payment of Duties and
Taxes. – Goods declared
shall be released when duties
and taxes and other lawful
charges have been paid or
secured and all the pertinent
laws, rules and regulations
have been complied with.
When the Bureau requires
laboratory analysis of
samples, detailed technical
documents or expert advice,
it may release the goods
before the results of such
examination are known after
posting of sufficient security
by the declarant.
Sec. 432. Release of Goods
to the Holder of Bill of Lading
or Airway Bill. – Any customs
officer who releases goods to
the consignee or lawful
holder of the bill of lading or
airway bill shall not be liable
e. The failure or refusal of the
owner or importer to mark the
articles as herein required
within a period of thirty days
after due notice shall
constitute as an act of
abandonment of said articles
and their disposition shall be
governed by the provisions of
this Code relative to
abandonment of imported
articles.
. .
Sec. 304. Discrimination by
Foreign Countries. —
a. The President, when he
finds that the public interest
will be served thereby, shall
by proclamation specify and
declare new or additional
duties in an amount not
exceeding 50 per cent of the
existing rates as hereinafter
provided upon articles wholly
or in part the growth or
product of, or imported in a
vessel of, any foreign country
whenever he shall find as a
fact that such country —
(1) Imposes, directly or
indirectly, upon the
disposition in, or
transportation in transit
through or re-exportation
from such country of any
article wholly or in part the
growth or product of the
Philippines any unreasonable
charge, exaction, regulation
administrative regulation or
practice, by or in respect to
any customs, tonnage, or
port duty, fee, charge,
exaction, classification,
regulation, condition,
restriction or prohibition, in
such manner as to place the
commerce of the Philippines
at a disadvantage compared
with the commerce of any
foreign country.
b. If at any time the
President shall find it to be a
fact that any foreign country
has not only discriminated
against the commerce of the
Philippines, as aforesaid, but
has, after the issuance of a
proclamation as authorized in
subsection "a" of this section,
maintained or increased its
said discrimination against
the commerce of the
Philippines, the President is
hereby authorized, if he
deems it consistent with the
interests of the Philippines, to
issue a further proclamation
directing that such product of
said country or such article
imported in its vessels as he
shall deem consistent with
the public interests, shall be
excluded from importation
into the Philippines.
c. Any proclamation issued
by the President under this
section shall, if he deems it
consistent with the interest of
for any defect or irregularity
in its negotiation unless the
customs officer has notice of
the defect or irregularity.
Sec. 433. Release of Goods
Without Production, of Bill of
Lading or Airway Bill. – No
customs officer shall release
goods to any person without
the submission of the bill of
lading or airway bill covering
the goods, except on written
order of the carrier or agent
of the vessel or aircraft, in
which case neither the
government nor the customs
officer shall be held liable for
any damage arising from
wrongful release of the
goods: Provided, That when
the release of goods is made
against such written order,
the customs officer shall
require the submission of a
copy of the bill.
Sec. 434. Release of Goods
Upon Order of Importer. – An
importer may issue a written
authorization for the release
of goods stored in a bonded
warehouse to another
person. Such authorization
shall not relieve the importer
from liability for the duties,
taxes and other charges due
on the goods unless the
person to whom the release
was authorized assumes
such liability.
or limitation which is not the Philippines, extend to the Sec. 435. Withholding
equally enforced upon the whole of any foreign country Release Pending Satisfaction
like articles of every foreign or may be confined to any of Lien. – When the District
country; or subdivision or subdivisions Collector is duly notified
thereof; and the President through a lawful order of a
(2) Discriminates in fact shall, whenever he deems competent court of a Hen for
against the commerce of the the public interests require, freight, lighterage or general
Philippines, directly or suspend, revoke, supplement average upon any imported
indirectly, by law or or amend any such goods, the District Collector
administrative regulation or proclamation. shall withhold the release of
practice, by or in respect to the goods unless the claim
any customs, tonnage, or has been paid or secured. In
port duty, fee, charge, d. All articles imported case of disagreement, the
exaction, classification, contrary to the provisions of District Collector may release
regulation, condition, this section shall be forfeited the goods after payment of
restriction or prohibition, in to the Government of the the freight and lighterage due
such manner as to place the Philippines and shall be liable on the quantity or weight
commerce of the Philippines to be seized, prosecuted and landed as actually
at a disadvantage compared condemned in like manner determined.
with the commerce of any and under the same
foreign country. regulations, restrictions and Sec. 436. Fine or Surcharge
provisions as may from time on Goods. – Goods subject
b. If at any time the President to time be established for the to any fine or surcharge shall
shall find it to be a fact that recovery, collection, be released only after the
any foreign country has not distribution and remission or payment of the fine or
only discriminated against the forfeiture to the government surcharge.
commerce of the Philippines, by the tariff and customs
as aforesaid but has, after laws. Whenever the provision CHAPTER 4
the issuance of a of this section shall be
proclamation as authorized in applicable to importations SPECIAL PROCEDURES
subsection "a" of this section, into the Philippines of articles
maintained or increased its wholly or in part the growth or Sec. 437. Traveler and
said discriminations against product of any foreign Passenger Baggage. – The
the commerce of the country, they shall be Bureau shall provide
Philippines, the President is applicable thereto, whether simplified customs procedure
hereby authorized, if he such articles are imported for traveler and baggage
deems it consistent with the directly or indirectly. processing based on
interests of the Philippines, to international agreements and
issue a further proclamation e. It shall be the duty of the customs best practices.
directing that such product of Commission to ascertain and
said country or such articles at all times to be informed Travelers shall be permitted
imported in its vessels as he whether any of the to export goods for
shall deem consistent with
the public interests, shall be
excluded from importation
into the Philippines.
. practiced by any country; and
c. Any proclamation issued
by the President under the
authority of this section shall,
if he deems it consistent with
the interests of the
Philippines, extend to the
whole of any foreign country
or may be confined to any
subdivision or subdivisions
thereof; and the President
shall, whenever he deems
the public interests require,
suspend, revoke, supplement
or amend any such
proclamation.
. .
d. All articles imported
contrary to the provisions of
this section shall be forfeited
to the Government of the
Philippines and shall be liable
to be seized, prosecuted and
condemned in like manner
and under the same
regulations, restrictions and
provisions as may from time
to time be established for the
recovery, collection,
distribution and remission of
forfeiture to the government
by the tariff and customs
laws. Whenever the provision
of this section shall be
applicable to importations
into the Philippines of articles
wholly or in part the growth or
product of any foreign
discrimination against the
commerce of the Philippines
enumerated in subsections
"a" and "b" of this section are
if and when such
discriminatory acts are
disclosed, it shall be the duty
of the Commission to bring
the matter to the attention of
the President, together with
recommendations.
f. The Secretary of finance
shall make such rules and
regulations as are necessary
for the execution of such
proclamation as the
President may issue in
accordance with the
provisions of this section.
PART 3
FLEXIBLE TARIFF
Sec. 401. Flexible Clause. —
a. In the interest of national
economy, general welfare
and/or national security, and
subject to the limitations
herein prescribed, the
President, upon
recommendation of the
National Economic and
commercial pm-poses,
subject to compliance with
the necessary export
formalities and payment of
export duties, taxes and
charges, if any.
Sec. 438. Postal Item or Mail.
– Postal item or mail shall
include letter-post and
parcels, as described in
international practices and
agreements, such as the Acts
of the Universal Postal Union
(AUPU), currently in force.
A simplified procedure shall
be used in the clearance of
postal item or mail, including
the collection of the
applicable duties and taxes
on such items or goods.
When all the information
required by the customs are
available in the special
declaration form for postal
items as provided in the
AUPU or similar international
agreements, the special
declaration form and
supporting documents shall
be the goods declaration.
However, a separate goods
declaration shall be required
for the following:
(a) Goods whose value fall
within the level that the
Commissioner has
determined to be taxable and
country, they shall be
applicable thereto whether
such articles are imported
directly or indirectly.
. reduce or remove existing
e. It shall be the duty of the
Commission to ascertain and
at all times to be informed
whether any of the
discriminations against the
commerce of the Philippines
enumerated in subsections
"a" and "b" of this section are
practiced by any country; and
if and when such
discriminatory acts are
disclosed, it shall be the duty
of the Commission to bring
the matter to the attention of
the President, together with
recommendation.
. imports not exceeding ten
f. The Secretary shall make
such rules and regulations as
are necessary for the
execution of such
proclamation as the
President may issue in
accordance with the
provisions of this section.
. protection levels granted in
g. The authority granted
herein to the President shall
be exercised only when
Congress is not in session.
PART 3
FLEXIBLE TARIFF
Development Authority
(hereinafter referred to as
NEDA), is hereby
empowered: (1) to increase,
protective rates of import duty
(including any necessary
change in classification). The
existing rates may be
increased or decreased to
any level, in one or several
stages but in no case shall
the increased rate of import
duty be higher than a
maximum of one hundred
(100) per cent ad valorem;
(2) to establish import quota
or to ban imports of any
commodity, as may be
necessary; and (3) to impose
an additional duty on all
(10%) per cent ad valorem
whenever necessary;
Provided, That upon periodic
investigations by the Tariff
Commission and
recommendation of the
NEDA, the President may
cause a gradual reduction of
Section One Hundred and
Four of this Code, including
those subsequently granted
pursuant to this section.
b. Before any
recommendation is submitted
to the President by the NEDA
pursuant to the provisions of
this section, except in the
imposition of an additional
thus must be covered by a
goods declaration;
(b) Prohibited and regulated
goods;
(c) Goods, the exportation of
which must be certified; and
(d) Imported goods under a
customs procedure other
than for consumption. '
Sec. 439. Express Shipment
– The Bureau shall provide
simplified customs
procedures based on
international standards and
customs best practices for air
shipments considered as
time-sensitive and requiring
pre-arrival clearance.
Express shipments of
accredited air express cargo
operators may be released
prior to the payment of the
duty, tax and other charges
upon posting of a sufficient
security.
Sec. 440. Establishment of
Advance Customs Clearance
and Control Program. – The
Bureau may establish and
implement a voluntary
program on advance customs
clearance and control on
containerized cargoes. The
details of the voluntary
advance customs clearance
shall be subject to the rules
and regulations to be issued
Sec. 401. Flexible Clause. —
a. The President, upon
investigation by the
Commission and
recommendation of the
National Economic Council,
is hereby empowered to
reduce by not more than fifty
per cent or to increase by not
more than five times the rates
of import duty expressly fixed
by statute (including any
necessary change in
classification) when in his
judgment such modification in
the rates of import duty is
necessary in the interest of
national economy, general
welfare and/or national
defense.
. public hearings.
b. Before any
recommendation is submitted
to the President by the
Council pursuant to the
provisions of this section, the
Commission shall conduct an
investigation in the course of
which it shall hold public
hearings wherein interested
parties shall be afforded
reasonable opportunity to be
present, to produce evidence
and to be heard. The
Commission may also
request the views and
recommendations of any
government office, agency or
instrumentality, and such
office, agency or
instrumentality shall
duty not exceeding ten (10)
per cent ad valorem, the
Commission shall conduct an
investigation in the course of
which they shall hold public
hearings wherein interested
parties shall be afforded
reasonable opportunity to be
present, produce evidence
and to be heard. The
Commission shall also hear
the views and
recommendations of any
government office, agency or
instrumentality concerned.
The Commission shall submit
their findings and
recommendations to the
NEDA within thirty (30) days
after the termination of the
c. The power of the
President to increase or
decrease rates of import duty
within the limits fixed in
subsection "a" shall include
the authority to modify the
form of duty. In modifying the
form of duty, the
corresponding ad valorem or
specific equivalents of the
duty with respect to imports
from the principal competing
foreign country for the most
recent representative period
shall be used as bases.
d. The Commissioner of
Customs shall regularly
furnish the Commission a
copy of all customs import
entries as filed in the Bureau
Sec. 2. Sec. 1302 of Part 2,
Title IV of the Tariff and
Customs Code of the
Philippines, as amended, is
hereby further amended to
read as follows:
"Sec. 1302. Import Entries.
All imported articles, except
importations admitted free of
duty under Subsection "k",
Sec. one hundred and five of
this Code, shall be subject to
a formal or informal entry.
Articles of a commercial
nature intended for sale,
barter or hire, the dutiable
value of which is Two
thousand pesos (P2,000.00)
or less, land personal and
household effects or articles,
not in commercial quantity,
by the Bureau after
conducting the necessary
public hearings and
consultations with the
concerned sectors.
TITLE V
EXPORT CLEARANCE AND
FORMALITIES
CHAPTER 1
EXPORT CLEARANCE AND
DECLARATION
Sec. 500. Export Declaration.
– All goods exported from the
Philippines, whether subject
to export duty or not, shall be
declared through a
competent customs office
through an export
declaration, duly signed
electronically or otherwise by
the party making the
declaration.
The description of the goods
in the export declaration must
contain sufficient and specific
information for statistical
purposes as well as for the
proper valuation and
classification of the goods.
Sec. 501. Export Product to
Conform to Standard Grades.
– If applicable, products shall
conform to export standard
grades established by the
government. The packaging
cooperate fully with the
Commission.
c. The President shall have
no authority to transfer
articles from the duty-free list
to the dutiable list nor from
the dutiable list to the duty-
free list of the tariff.
d. The power of the President
to increase or decrease rates
of import duty within the limits
fixed in subsection "a" shall
include the authority to
modify the form of duty. In
modifying the form of duty the
corresponding ad valorem or
specific equivalents of the
duty with respect to imports
from the principal concerning
foreign country for the most
recent representation period
shall be used as basis.
e. The Commissioner of
Customs shall regularly
furnish to the Commission a
copy each of all customs
import entries containing
every pertinent information
appearing in the collectors'
liquidated duplicates,
including the consular invoice
and/or the commercial
invoice. The Commission or
its duly authorized agents
shall have access to and the
right to copy all the customs
import entries and other
documents appended thereto
of Customs. The Commission
or its duly authorized
representatives shall have
access to, and the right to
copy all liquidated customs
import entries and other
documents appended thereto
as finally filed in the
Commission on Audit.
e. The NEDA shall
promulgate rules and
regulations necessary to
carry out the provisions of
this section.
f. Any Order issued by the
President pursuant to the
provisions of this section
shall take effect thirty (3)
days after promulgation,
except in the imposition of
additional duty not exceeding
ten (10) per cent ad valorem
which shall take effect at the
discretion of the President.
Sec. 402. Promotion of
Foreign Trade. —
a. For the purpose of
expanding foreign markets
for Philippine products as a
means of assistance in the
economic development of the
country, in overcoming
domestic unemployment, in
increasing the purchasing
power of the Philippine peso,
and in establishing and
maintaining better relations
imported in passenger's
baggage, mail or otherwise,
for personal use, shall be
cleared on an informal entry
whenever duty, tax or other
charges are collectible.
The Commissioner may,
upon instruction of the
Secretary of Finance, for the
protection of domestic
industry or of the revenue,
require a formal entry,
regardless of value, whatever
be the purpose and nature of
the importation.
A formal entry may be for
immediate consumption, or
under irrevocable domestic
letter of credit, bank
guarantee or bond for:
(a) Placing the article in
customs bonded warehouse;
(b) Constructive
warehousing and immediate
transportation to other port of
the Philippines upon proper
examination and appraisal; or
(c) Constructive
warehousing and immediate
exportation.
Import entries under
irrevocable domestic letter of
credit, bank guarantee or
bond shall be subject to the
provisions of Title V, Book II
of this Code.
of the said goods shall
likewise be labeled and
marked, in accordance with
related laws and regulations.
Export declaration may not
be granted for goods violating
the aforementioned
requirements.
Sec. 502. Lodgement and
Processing of Export
Declaration. – The Bureau
shall promulgate rules and
regulations to allow manual
and electronic lodgement and
processing of the export
declaration.
Sec. 503. Rules of Origin.. –
Pursuant to the applicable
rules of origin, the Bureau or
any other designated
government agency may
determine the origin of goods
for export and, if appropriate,
issue the corresponding
certificates of origin.
However, the exporter may
adopt a self-certification
system: Provided, That it is
duly accredited by the Bure
au or any other authorized
government agencies.
TITLE VI
CUSTOMS TRANSIT AND
TRANSSHIPMENT
CHAPTER 1
CUSTOMS TRANSIT
as finally in the General
Auditing Office.
f. The Commission is
authorized to adopt such
reasonable procedure, rules
and regulations as it may
deem necessary to carry out
the provisions of this section.
g. Any order issued by the
President pursuant to the
provisions of this section
shall take effect thirty days
after its issuance.
h. The provisions of this
section shall not apply to any
article the importation of
which into the Philippines is
or may be governed by
Section 402 of this Code.
i. The authority herein
granted to the President shall
be exercised only when
Congress is not in session.
Sec. 402. Promotion of
Foreign Trade. — a. For the
between the Philippines and
other countries, the
President, is authorized from
time to time:
(1) To enter into trade
agreements with foreign
governments or
instrumentalities thereof; and
(2) To modify import
duties (including any
necessary change in
classification) and other
import restrictions, as are
required or appropriate to
carry out and promote foreign
trade with other countries:
Provided, however, That in
modifying import duties or
fixing import quota the
requirements prescribed in
subsection "a" of Section 401
shall be observed: Provided,
further, That any modification
of import duties and any
fixing of import quotas made
pursuant to this agreement
on ASEAN Preferential
Trading Arrangements
ratified on August 1, 1977
shall not be subject to the
limitations of aforesaid
section "a" of Section 401.
b. The duties and other
import restrictions as
modified in subsection "a"
above, shall apply to articles
which are the growth,
produce or manufacture of
the specific country, whether
All importations entered
under formal entry shall be
covered by a letter of credit
or any other verifiable
document evidencing
payment."
Sec. 3. Sec. 1407 of Part 3
Title IV of the Tariff and
Customs Code of the
Philippines, as amended, is
hereby further amended to
read as follows:
"Sec. 1407. Readjustment
of Appraisal, Classification or
Return. - Such appraisal,
classification or return as
finally passed upon and
approved or modified by the
Collector shall not be altered
or modified in any manner,
except:
(a) Within one year after
payment of the duties, upon
statement of error in
conformity with Sec.
seventeen hundred and
seven hereof, approved by
the Collector.
(b) Within fifteen days
after such payment upon
request for reappraisal and/or
reclassification addressed to
the Commissioner by the
Collector, if the appraisal
and/or classification is
deemed to be low.
Sec. 600. Customs Transit in
the Customs Territory. –
Customs transit within the
customs territory shall be
allowed for goods except
those intended for
consumption, to be
transported as follows:
(a) From port of entry to
another port of entry as exit
point for outright exportation;
(b) From port of entry to
another port of entry or inland
customs office;
(c) From inland customs
office to a port of entry as exit
point for outright exportation;
and
(d) From one port of entry or
inland customs office to
another port of entry or inland
customs office.
A transit permit is required for
goods transported under
customs transit. However,
transfer of goods in customs
transit from one means of
transport to another shall be
allowed: Provided, That any
customs seal or fastening is
not broken or tampered.
The party responsible for the
compliance of the obligations
imposed on customs transit
shall ensure that the goods
purpose of expanding foreign
markets for Philippine
products as a means of
assisting in the economic
development of the country,
in overcoming domestic
unemployment, in increasing
the purchasing power of the
Philippine peso, and in
establishing and maintaining
better relationship between
the Philippines and other
countries, the President,
upon investigation by the
Commission and
recommendation of the
National Economic Council,
is authorized from time to
time:
(1) To enter into trade
agreements with foreign
governments or
instrumentalities thereof; and
. reduce in any manner any of
(2) To modify import duties
(including any necessary
change in classification) and
other import restrictions, as
are required or appropriate to
carry out and promote foreign
trade with other countries:
Provided, however, That in
modifying import duties no
increase shall exceed by five
times or the decrease be
more than fifty per cent of the
rate of duty expressly fixed
by this Code.
b. The proclaimed duties and
other import restrictions shall
imported directly or indirectly,
with which the Philippines
has entered into a trade
agreement: Provided, That
the President may suspend
the application of any
concession to articles which
are the growth, produce or
manufacture of such country
because of acts (including
the operations of international
cartels) or policies which in
his opinion tend to defeat the
purposes set in this section;
and the duties and other
import restrictions as
negotiated shall be in force
and effect from and after
such time as specified in the
Order.
c. Nothing in this section
shall be construed to give
any authority to cancel or
the indebtedness of any
foreign country to the
Philippines or any claim of
the Philippines against any
foreign country.
d. Before any trade
agreement is concluded with
any foreign government or
instrumentality thereof,
reasonable public notice of
the intention to negotiate an
agreement with such
government or instrumentality
shall be given in order than
any interested person may
have an opportunity to
present his views to the
(c) Upon request for
reappraisal and/or
reclassification, in the form of
a timely protest addressed to
the Collector by the
interested party if the latter
should bed dissatisfied with
the appraisal or return.
(d) Upon demand by the
Commissioner of Customs
after the completion of
compliance audit pursuant to
the provisions of this Code."
Sec. 4. Sec. 1603 of Part 5,
Title IV of the Tariff and
Customs Code of the
Philippines, as amended, is
hereby further amended to
read as follows:
"Sec. 1603. Finality of
Liquidation. When articles
have been entered and
passed free of duty or final
adjustments of duties made,
with subsequent delivery,
such entry and passage free
of duty or settlements of
duties will, after the expiration
of three (3) years from the
date of the final payment of
duties, in the absence of
fraud or protest or
compliance audit pursuant to
the provisions of this Code,
be final and conclusive upon
all parties, unless the
liquidation of the import entry
was merely tentative."
are presented intact and in
due course at the customs
office of destination. Failure
to comply with the
aforementioned obligations or
like-wise failure to follow a
prescribed itinerary or period
for delivery of the goods may
immediately subject the
goods to the corresponding
duties, taxes and other
applicable fines, penalties,
and surcharges.
SBC. 601. Duty and Tax on
Goods Intended for Transit. –
Transit goods admitted for
storage in a customs bonded
warehouse, or for outright
exportation at the port of
destination or inland customs
office, and goods intended for
transit covered by Republic
Act No. 10668, otherwise
known as "An Act Allowing
Foreign Vessels to Transport
and Co-Load Foreign
Cargoes for Domestic
Transshipment and for Other
Purposes", shall not be
subject to the payment of
duties and taxes at the port of
entry: Provided, That any
conditions and security
required by the Bureau are
complied with.
Goods for consumption and
other goods intended for
customs transit not covered
by the immediately preceding
paragraph shall be subject to
apply to articles the growth,
produce or manufacture of all
foreign countries, whether
imported directly or indirectly:
Provided, That the President
may suspend the application
of any concession to articles
the growth, produce or
manufacture of any country
because of its discriminatory
treatment of Philippine
commerce or because of
other acts (including the
operations of international
cartels) or policies which in
his opinion tend to defeat the
purposes set in this section;
and the proclaimed duties
and other import restrictions
shall be in force and effect
from and after such time as is
specified in the proclamation.
The President may at any
time terminate any such
proclamation in whole or in
part.
. reasonable, taking into
c. Every trade agreement
concluded pursuant to this
section shall be subject to
termination upon due notice
to the foreign government
concerned at the end of not
more than five years from the
date on which the agreement
comes into force and, if not
then terminated, shall be
subject to termination
thereafter upon not more
than six months' notice.
. report of the findings and
Commission which shall seek Sec. 5. A new section to be the payment of duties and
information and advice from known as Sec. 2317 is taxes at the port of discharge.
the Department of hereby inserted under Part 2,
Agriculture, Department of Title VI of the Tariff and Sec. 602. Carrier's Security.
Natural Resources, Customs Code of the – Carriers that transport
Department of Trade and Philippines, as amended, imported goods that shall be
Industry, Department of which shall read as follows: placed under customs transit
Tourism, the Central Bank of from a port of entry to other
the Philippines, the "Sec. 2317. Government's ports, shall post a general
Department of Foreign Right of Compulsory transportation security
Affairs, the Board of Acquisition. In order to amounting to at least fifty
Investments and from such protect government revenues thousand pesos
other sources as it may deem against the undervaluation of (P50,000.00). Such security
appropriate. goods subject to ad valorem shall ensure the complete
duty, the Commissioner of and immediate delivery of
e. (1) In advising the Customs may acquire goods to the customs officer
President, as a result of the imported goods under at the port of destination and
trade agreement entered into, question for a price equal to the payment of pertinent
the Commission shall their declare customs value customs charges and
determine whether the plus any duties already paid expenses and other transfer
domestic industry has on the goods, payment for costs. The amount of the
suffered or is being which shall be made within security may be adjusted by
threatened with injury and ten (10) working days from the Commissioner, upon
whether the wholesale prices issuance of a warrant signed approval of the Secretary of
at which the domestic by the Commissioner of Finance.
products are sold are Customs for the acquisition of
such goods. CHAPTER 2
account the cost of raw
materials, labor, overhead, a An importer who is CUSTOMS
fair return on investment, and dissatisfied with a decision of TRANSSHIPMENT
the overall efficiency of the the Commissioner of
industry. Customs pertaining to this Sec. 603. Customs
section may, within twenty Transshipment. – Goods
(2) The NEDA shall (20) working days after the admitted for transshipment
evaluate the report of the date on which notice of the shall not be subject to the
Commission and submit decision is given, appeal to payment of duties and taxes:
recommendations to the the Secretary of Finance and Provided, That the goods
President. thereafter if still dissatisfied, declaration for customs
to the court of Tax Appeals transshipment particularly
(3) Upon receipt of the as provided for in Sec. 2402 indicates such nature of the
of the Tariff and Customs goods, duly supported by
recommendations of the commercial or transport
d. The authority of the
President to enter into trade
agreements under this
section shall terminate on the
expiration of five years from
the date of enactment of this
Code: Provided, That trade
agreements concluded
pursuant to the provisions of
this section and subsisting as
of the date of the expiration
of this authority shall remain
in force for the period fixed in
the agreement in and may
not be extended but he may
be sooner terminated in
accordance with the
preceding subsection.
. NEDA, is authorized by the
e. Nothing in this section
shall be construed to give
any authority to cancel or
reduce in any manner any of
the indebtedness of any
foreign country to the
Philippines or any claim of
the Philippines against any
foreign country.
. wholesale prices.
f. Before any trade
agreement is conducted with
any foreign government or
instrumentality thereof,
reasonable public notice of
the intention to negotiate an
agreement with such a
government or instrumentality
shall be given in order that
any interested person may
have an opportunity to
present his views to the
Commission which shall seek
NEDA, the President may
prescribe such adjustments
in the rates of import duties,
withdraw, modify or suspend,
in whole or in part, or institute
such other import restrictions
as the NEDA recommends to
be necessary in order to fully
protect domestic industry and
the consumers, subject to the
condition that the wholesale
prices of the domestic
products concerned shall be
reduced to, or maintained at,
the level recommended by
the NEDA unless for good
cause shown, an increase
thereof, as recommended by
President. Should increases
be made without such
authority, the NEDA shall
immediately notify the
President, who shall allow the
importation of competing
products in such quantities as
to protect the public from the
unauthorized increase in
f. This section shall not
prevent the effectivity of any
executive agreement or any
future preferential trade
agreement with any foreign
country.
g. The NEDA and the
Commission are authorized
to promulgate such
reasonable procedure, rules
and regulations as they may
Code of the Philippines, as
amended.
Where no appeal is made
by the importer, or upon
reaffirmation of the
commissioner's decision
during the appeals process,
the Bureau of Customs or its
agent shall sell the acquired
goods pursuant to existing
laws and regulations.
Nothing in this Sec. limits
or affects any other powers of
the Bureau of Customs with
respect to the disposition of
the goods or any liability of
the importer or any other
person with respect to an
offense committed in the
importation of the goods."
Sec. 6. Sec. 2401 of Part,
Title VI of the Tariff and
Customs Code of the
Philippines, as amended, is
hereby further amended to
read as follows:
"Sec. 2401. Supervision
and Control Over Criminal
and Civil Proceedings. - Civil
and criminal actions and
proceedings instituted in
behalf of the government
under the authority of this
Code or other law enforced
by the Bureau shall be
brought in the name of the
government of the Philippines
and shall be conducted by
documents or evidence as
required by the Bureau.
Goods for transshipment
must be exported from the
Philippines within thirty (30)
days from arrival thereof.
The Commissioner may allow
an extension of such period
after the establishment of
valid reasons.
Sec. 604. Goods Entered for
Immediate Reexportation. –
Where an intent of
reexportation of the goods is
shown by the bill of lading,
invoice, manifest, or other
satisfactory evidence, the
whole or a part of a bill
comprising not less than one
package may be entered for
immediate reexportation
under security. The District
Collector shall designate the
vessel or aircraft in which the
goods are loaded
constructively as a
warehouse to facilitate the
direct transfer of the goods to
the exporting vessel or
aircraft.
Unless it shall appear in the
bill of lading, airway bill,
invoice, manifest, or other
satisfactory evidence, that
goods arriving in the
Philippines are destined for
transshipment, no exportation
thereof will be permitted
except under entry for
information and advice from
the Department of Agriculture
and Natural Resources, the
Department of Commerce
and Industry, the Central
Bank of the Philippines and
from such other sources as it
may deem appropriate. chan
robles virtual
g. (1) The Commission, upon
its own motion, or in
pursuance of a request of the
President or a resolution of
either house of Congress, or
upon application of any
interested party when in the
judgment of the Commission
there is good and sufficient
reason therefor, shall conduct
an investigation to determine
whether any product, as a
result of any concession
granted under a trade
agreement, is being imported
into the Philippines in such
increased quantities as to
cause or threaten serious
injury to the domestic
industry producing like or
directly competitive products.
The Commission shall render
a report thereof to the
President, through the
National Economic Council,
within three months after the
motion, request, resolution or
application was received.
Should the Commission find
that the representations
deem necessary to execute customs but no civil or
their respective functions criminal action for the
under this section. recovery of duties or the
enforcement of any fine,
penalty or forfeiture under
this Code shall be filed in
court without the approval of
the Commissioner."
Sec. 7. Sec. 2606 of Part 5,
Title VI of the Tariff and
Customs Code of the
Philippines, as amended, is
hereby further amended to
read as follows:
"Sec. 2606. Disposition of
Surplus from the Proceeds of
Sale of Abandoned or
Forfeited or Acquired Articles.
- Except in the case of the
sale of abandoned or
forfeited articles, and articles
which are not claimed by
payment of duties, taxes and
other charges and
compliance with all legal
requirements within the
prescribed period, any
surplus remaining after the
satisfaction of all unlawful
charges as aforesaid shall be
retained by the Collector for
ten (10) days subject to the
call of the owner.
Upon failure of the owner
to claim such surplus within
this period, the Collector shall
deposit such amount in a
special trust fund which shall
be used solely for the
immediate reexportation
under sufficient security in an
amount equal to the
ascertained duties, taxes and
other charges.
Upon the reexportation of the
goods, and the production of
proof of landing beyond the
limits of the Philippines, the
security shall be released.
TITLE VII
IMPORT DUTY AND TAX
CHAPTER 1
BASIS OF VALUATION
Sec. 700. Sequential
Application of Valuation
Methods. – Imported goods
shall be valued in accordance
with the provisions of Section
701 of this Act whenever the
conditions prescribed therein
are fulfilled.
Where the customs value
cannot be determined under
the provisions of Section 701
of this Act, it is to be
determined by proceeding
sequentially through the
succeeding sections hereof
to the first such section under
which the customs value can
be determined. Except as
provided in Section 704 of
this Act, it is only when the
customs value cannot be
made in accordance with the
preceding paragraph are
justified, it shall recommend
to the President, through the
National Economic Council
the withdrawal or modification
of the concession, its
suspension in whole or in
part, or the establishment of
import quota which shall not
be less than ten per centum
or more than one hundred
per centum of the average
annual quantity imported or,
in the absence thereof, the
average annual value of such
importation, during the three
calendar years immediately
preceding the date such
quota is fixed, to the extent
and for the time necessary to
prevent or remedy such
injury.
2) Upon receipt of the report
of the findings and
recommendation of the
Commission, the President
may prescribe such
adjustments in the rates of
import duties, or such other
modifications as are
recommended by the
Commission to be necessary
to prevent or remedy serious
injury to the respective
domestic industry.
h. Nothing in this section
shall be construed to
preclude giving effect to any
executive agreement or any
PART 4
TARIFF COMMISSION
Sec. 501. Chief Officials of
the Tariff Commission. —
The Officials of the Tariff
Commission shall be the
Chairman and two (2)
Member Commissioners to
be appointed by the
President of the Philippines.
Sec. 502. Qualifications. —
No person shall be eligible for which shall read as follows:
appointment as Chairman
and Tariff Commissioners
unless they are natural-born
citizens of the Philippines, of importers are required to
good moral character and
proven integrity, and who by
experience and academic
training are possessed of
qualifications requisite for
developing expert knowledge and for a period three (3)
of tariff problems. They shall years from the date of
not, during their tenure in
purpose of financing the
compulsory acquisition of
imported goods by the
government as provided in
Sec. 2317 hereof.
In all such cases the
Collector shall report fully his
action in the matter, together
with all the particulars, to the
Commissioner and to the
Chairman on Audit. After one
year, the unused amounts in
such special trust funds,
except for an amount
necessary to finance forced
government acquisitions
before the first auction of the
succeeding year, shall be
turned over to the Bureau of
Treasury as customs
receipts."
Sec. 8. A new section to be
known as Sec. 3514 is
hereby inserted in Part, 2
Title VII of the Tariff and
Customs Code of the
Philippines, as amended,
"Sec. 3513. Requirement
to Keep Records. - All
keep at their principal place
of business, in the manner
prescribed by regulations to
be issued by the
Commissioner of Customs
importation, all the records of
determined under the
provisions of a particular
section that the provisions of
the next section in the
sequence can be used.
If the importer does not
request that the order of
Sections 704 and 705 of this
Act be reversed, the normal
order of the sequence is to
be followed. If the importer so
requests but it is impossible
to determine the customs
value under Section 705 of
this Act, the customs value
shall be determined under
Section 704.
When the customs value
cannot be determined under
Sections 701 through 705, it
may be determined under
Section 706 of this Act.
Sec. 701, Transaction Value
System – Method One. – The
transaction value shall be the
price actually paid or payable
for the goods when sold for
export to the Philippines
adjusted in accordance with
the provisions of tins section:
Provided, That:
(a) There are no restrictions
as to the disposition or use of
the goods by the buyer other
than restrictions which:
future preferential trade office, engage in the practice their importations and/or (i) Are imposed or required
agreement with the United of any profession, or books of accounts, business by law or by Philippine
States, or to extend to any intervene directly or indirectly and computer systems and authorities;
other country the preferential in the management or control all customs commercial data
treatment accorded by the of any private enterprise including payment records (ii) Limit the geographical
Philippines to the products of which may, in any way, be relevant for the verification of area in which the goods may
the United States of America. affected by the functions of the accuracy of the be resold; or
their office nor shall be, transaction value declared by
i. The Commission is directly or indirectly, the importers/customs (iii) Do not substantially affect
authorized to adopt such financially interested in any brokers on the import entry. the value of the goods;
reasonable procedure, rules contract with the
and regulations as it may Government, or any All brokers are required to (b) The sale or price is not
deem necessary to execute subdivision or instrumentality keep at their principal place subject to some condition or
its functions under this thereof. of business, in the manner consideration for which a
section. prescribed by regulations to value cannot be determined
Sec. 503. Appointment and be issued by the with respect to the goods
PART 4 Compensation of Officials Commissioner of Customs being valued; and
TARIFF COMMISSION and Employees. — All and for a period of three (3)
employees of the years from the date of (c) The buyer and the seller
Commission shall be importation copies of the are not related, or where the
Sec. 501. Chief Officials of appointed by the Chairman in above mentioned records buyer and the seller are
the Tariff Commission. — accordance with the Civil covering transactions that related, that the transaction
The Tariff Commission shall Service Law except the they handle." value is acceptable for
be under a chief and private secretaries to the customs purposes under the
assistant chief to be known Chairman, Commissioners Sec. 9. A new section to be provisions hereof.
as Commissioner and and Executive Director. known as Sec. 3515 is
Assistant Commissioner, and hereby inserted in Part 2, For purposes of this Act,
who shall be appointed by The Tariff Commission shall Title VII of the Tariff and persons shall be deemed
the President with the be reorganized in accordance Customs Code of the related only if:
consent of the Commission with the requirements of its Philippines, as amended,
on Appointments. They shall reorganized functions and which shall read as follows: (i) They are officers or
hold office during good responsibilities. The directors of one another's
behavior unless sooner Chairman of the Commission, "Sec. 3515. Compliance business;
removed in accordance with subject to the approval of the Audit or Examination of
law. Director-General of the Records. - The (ii) They are legally
National Economic and importers/customs brokers recognized partners in
The Commissioner and Development Authority, shall shall allow any customs business;
Assistant Commissioner shall determine the new positions- officer authorized by the
each receive twelve thousand designations and salary Bureau of Customs to enter (iii) There exists an
and ten thousand pesos, per scales of the officials and during office hours any employer-employee
annum, respectively. employees of the premises or place where the relationship between them;
Commission by taking into records referred to in the
Sec. 502. Qualifications. —
No person shall be eligible for
appointment as
Commissioner and as
Assistant Commissioner
unless he is a natural-born
citizen of the Philippines and
who by experience and
academic training is
possessed of qualifications
requisite for developing
expert knowledge of tariff
problems. They shall not,
during their tenure in office,
engage in the practice of any
profession, or intervene
directly or indirectly in the
management or control of
any private enterprise which
may, in any way, be affected
by the functions of his office;
nor shall he, directly or
indirectly, be financially
interested in any contract
with the Government, or any
subdivision or instrumentality
thereof.
. Sec. 505. Functions of the
Sec. 503. Appointment and
Compensation of Officials
and Employees. — All
employees of the
Commission shall be
appointed by the
Commissioner in accordance
with the civil service law
except a private secretary
each to the Commissioner
and the Assistant
Commissioner.
. officer produces to the
account the degree of
responsibilities of each
position: Provided, That the
Office of Compensation and
Position Classification shall
be furnished a copy of the
new plantilla of positions
incorporating the new
designations to be
automatically included in its
manual of positions:
Provided, further, That the
reorganization shall not in
any way affect whatever
benefits the officials and
employees of the
Commission are allowed
under existing law and/or
authority.
Sec. 504. Official Seal. —
The Commission is
authorized to adopt an official
seal.
Commission. — The
Commission shall investigate
— (a) the administration of,
and the fiscal and industrial
effects of, the tariff and
customs laws of this country
now in force or which may
hereafter be enacted;
(b) the relation between
the rates of duty on raw
materials and the finished or
partly finished products;
preceding section are kept to
conduct audit examination,
inspection, verification and/or
investigation of those records
either in relation to specific
transactions or to the
adequacy and integrity of the
manual or electronic system
or systems by which such
records are created and
stored. For this purpose. A
duty authorized customs
officer shall be full and free
access to all books, records,
and documents necessary or
relevant for the purpose of
collecting the proper duties
and taxes.
In addition, the authorized
customs officer may make
copies of, or take extracts
from any such documents.
The records or documents
must, as soon as practicable
after copies of such have
been taken, be returned to
the person in charge of such
documents.
A copy of any such
document certified by or on
behalf of the importer/broker
is admissible in evidence in
all courts as if it were the
original.
An authorized customs
officer is not entitled to enter
any premises under this Sec.
unless, before so doing, the
(iv) Any person directly or
indirectly owns, controls or
holds five percent (5%) or
more of the outstanding
voting stocks or shares of
both seller and buyer;
(v) One of them directly or
indirectly controls the other;
(vi) Both of them are directly
or indirectly controlled by a
third person;
(vii) Together they directly or
indirectly control a third
person; or
(viii) They are members of
the same family, including
those related by affinity or
consanguinity up to the fourth
civil degree.
Persons who are associated
in business with one another
in that one is the sole agent,
sole distributor or sole
concessionaire, however
described, of the other shall
be deemed to be related for
the purposes of this Act if
they fall within, any of the
eight (8) cases cited in the
preceding paragraph.
In a sale between related
persons, the transaction
value shall be accepted as
basis for customs valuation
whenever the importer
demonstrates that such value
The Commissioner shall
adopt a salary schedule for
the principal executive and
technical personnel in
accordance with the following
rates, any provision of law to
the contrary notwithstanding:
1. Executive director
P8,400.00
chan robles virtual law li .
brary
2. Technical assistants
7,200.00
. treaties, preferential
3. Chiefs of division
7,200.00
. bounties and preferential
4. Commodity specialists
6,600.00
. (f) the volume of
5. Research economists,
tariff researchers, cost
accountants, and statisticians
6,000.00
6. Librarian-researcher
4,800.00
7. Junior commodity
specialists, junior research
economists, junior tariff
researchers, junior cost
accountants, and junior
statisticians 3,600.00
Sec. 504. Official Seal. —
The Commission is
authorized to adopt an official
seal.
. hereinafter provided; and
(c) the effects of ad
valorem and specific duties
and of compounds specific
and ad valorem duties;
(d) all questions relative to
the arrangement of
schedules and classification
of articles in the several
sections of the tariff law;
(e) the tariff relations
between the Philippines and
foreign countries, commercial
provisions, economic
alliances, the effect of export
transportation rates;
importations compared with
domestic production and
consumption;
(g) conditions, causes and
effects relating to competition
of foreign industries with
those of the Philippines,
including dumping and cost
of production;
(h) in general, to
investigate the operation of
customs and tariff laws,
including their relation to the
national revenues, their effect
upon the industries and labor
of the country, and to submit
reports of its investigation as
person occupying or
apparently in charge of the
premises written evidence of
the fact that he or she is an
authorized officer. The
person occupying or
apparently in charge of the
premises entered by an
officer shall provide the
officer with all reasonable
facilities and assistance for
the effective exercise of
powers under this Sec. .
Unless otherwise provided
herein or in other provisions
of law, the Bureau of
Customs may, in case of
disobedience, invoke the aid
of the proper regional trial
court within whose
jurisdiction the matter falls.
The court may punish
contumacy or refusal as
contempt. In addition, the fact
that the importer/broker
denies the authorized
customs officer full and free
access to importation records
during the conduct of a post-
entry audit shall create a
presumption of inaccuracy in
the transaction value
declared for their imported
goods and constitute grounds
for the Bureau of Customs to
conduct a re-assessment of
such goods.
This is without prejudice to
the criminal sanctions
imposed by this Code and
closely approximates one of
the following occurring at or
about the same time:
(a) The transaction value in
sales to unrelated buyers of
identical or similar goods for
export to the same country of
importation;
(b) The customs value of
identical or similar goods as
determined under the
provisions of Section 704 of
this Act; or
(c) The customs value of
identical or similar goods are
determined under the
provisions of Section 705 of
this Act.
In determining the transaction
value, the following shall be
added to the price actually
paid or payable for the
imported goods:
(1) To the extent that they are
incurred by the buyer but are
not included in the price
actually paid or payable for
the imported goods:
(a) Commissions and
brokerage fees except buying
commissions;
(b) Cost of containers;
(c) Cost of packing, whether
for labor or materials;
Sec. 505. Functions of the
Commission. — The
Commission shall investigate
— (a) the administration of
and the fiscal and industrial
effects of the tariff and
customs laws of this country
now in force or which may
hereafter be enacted;
. Central Bank of the
(b) the relations between the
rates of duty on raw materials
and the finished or partly
finished products;
(c) the effects of ad valorem
and specific duties and of
compound specific and ad
valorem duties;
(d) all questions relative to
the arrangement of
schedules and classification
of articles in the several
schedules of the tariff law;
(e) the tariff relations
between the Philippines and
foreign countries, commercial
treaties, preferential
provisions, economic
alliances, the effect of export
bounties and preferential
transportation rates;
(f) the volume of importations
compared with domestic
production and consumption;
(g) conditions, causes, and
effects relating to competition
of foreign industries with
(i) the nature and
composition of, and the
classification of, articles
according to tariff commodity
classification and heading
number for customs revenue
and other related purposes
which shall be furnished to
NEDA, Board of Investments,
Philippines, and Secretary of
Finance.
Sec. 506. Assistance to the
President and Congress of
the Philippines. — In order
that the President and the
Congress may secure
information and assistance, it
shall be the duty of the
Commission to —
(a) Ascertain conversion
costs and costs of production
in the principal growing,
producing or manufacturing
centers of the Philippines,
whenever practicable;
(b) Ascertain conversion
costs and costs of production
in the principal growing,
producing or manufacturing
centers of foreign countries of
articles imported into the
Philippines whenever such
conversion costs or costs of
production are necessary for
comparison with those in the
Philippines;
administrative sanctions that
the Bureau of Customs may
impose against contumacious
importers under existing laws
and regulations including the
authority to hold delivery or
release of their imported
articles."
Sec. 10. A new Sec. to be
known as Sec. 3516 is
hereby inserted in Part 2,
Title VII of the Tariff and
Customs Code of the
Philippines, as amended,
which shall read as follows:
"Sec. 3516. Scope of the
Audit.
(a) The audit of
importers shall be
undertaken:
(1) When firms are
selected by a computer-aided
risk management system, the
parameters of which are to
be based on objective and
quantifiable data and are to
be approved by the Secretary
of Finance upon
recommendation of the
Commissioner of Customs.
The criteria for selecting firms
to be audited shall include,
but not be limited to, the
following:
(a) Relative
magnitude of customs
revenue from the firm;
(d) Value, apportioned as
appropriate, of the following
goods and services:
materials, components, parts
and similar items
incorporated in the imported
goods; tools; dies; moulds
and similar items used in the
production of imported
goods; materials consumed
in the production of the
imported goods; and
engineering, development,
artwork, design work and
plans and sketches
undertaken elsewhere than in
the Philippines and
necessary for the production
of imported goods, where
such goods and services are
supplied directly or indirectly
by the buyer free of charge or
at a reduced cost for use in
connection with the
production and sale for
export of the imported goods;
and
(e) Amount of royalties and
license fees related to the
goods being valued that the
buyer must pay either directly
or indirectly, as a condition of
sale of the goods to the
buyer.
(2) Value of any part of the
proceeds of any subsequent
resale, disposal or use of the
imported goods that accrues
those of the Philippines,
including dumping and cost
of production; and
(h) in general, to investigate
the operation of customs and select and describearticles of
tariff laws, including their
relation to the national
revenues, their effect upon
the industries and labor of the file samples of articles so
country, and to submit
reports of its investigations as
hereinafter provided.
Sec. 506. Assistance to the
President and Congress. —
In order that the President
and the Congress may
secure information and
assistance, it shall be the
duty of the Commission to —
(a) Ascertain conversion
costs and costs of production
in the principal growing,
producing or manufacturing
(c) Select and describe
representative articles
imported into the Philippines
similar to, or comparable
with, those locally produced;
the Philippines similar to, or
comparable with, such
imported article; obtain and
selected whenever advisable;
(d) Ascertain import costs
of such representative
articles so selected;
(e) Ascertain the grower's,
producer's or manufacture's
selling prices in the principal
growing, producing, or
manufacturing centers in the
Philippines, of the articles of
the Philippines, so selected;
(f) Ascertain all other facts their importer clients and/or
which will show the difference fill information gaps revealed
in, or which affect competition during an audit of their
between, articles of the
Philippines and those
imported in the principal
markets of the Philippines;
(g) Ascertain conversion
costs and costs of production Customs Code of the
including effects of tariff
modifications or import
restrictions on prices in the
principal growing, producing
or manufacturing centers in
the Philippines, whenever
practicable; and
(b) The rates of
duties of the firm's imports;
(c) The compliance
tract records of the firm; and
(d) An assessment
of the risk to revenue of the
firm's import activities.
(2) When errors in the
import declaration are
detected;
(3) When firms
voluntarily request to be
audited, subject to the
approval of the
Commissioner of Customs.
(b) Brokers shall be
audited to validate audits of
importers clients."
Sec. 11. A new Sec. to be
known as Sec. 3517 is
hereby inserted in Part 2,
Title VII of the Tariff and
Philippines, as amended,
which shall read as follows:
"Sec. 3517. Documents in
Foreign Language. - Where a
document in a foreign
language is presented to a
customs officer in relation to
the carrying out of any duty
directly or indirectly to the
seller;
(3) Cost of transport of the
imported goods from the port
of exportation to the port of
entry in the Philippines;
(4) Loading, unloading and
handling charges associated
with the transport of the
imported goods from, the
country of exportation to the
port of entry in the
Philippines; and
(5) Cost of insurance.
All additions to the price
actually paid or payable shall
be made only on the basis of
objective and quantifiable
data.
Sec. 702. Transaction Value
of Identical Goods – Method
Two. – Where the dutiable
value cannot be determined
under method one, the
dutiable value shall be the
transaction value of identical
goods sold for export to the
Philippines and exported at
or about the same time as
the goods being valued. For
purposes of this section,
"Identical goods" refer to
goods which are the same in
all respects, including
physical characteristics,
quality and reputation. Minor
differences in appearances
centers of the Philippines,
whenever practicable;
chan robles virtual law lib .
rary
(b) Ascertain conversion
costs and costs of production
in the principal growing,
producing or manufacturing
centers of foreign countries of
articles imported into the
Philippines whenever such
conversion costs or costs of
production are necessary for
comparison with those in the
Philippines;
. Congress of the Philippines
(c) Select and describe
representative articles
imported into the Philippines
similar to or comparable with
those locally produced; select
and describe articles of the
Philippines similar to or
comparable with such
imported articles; and obtain
and the samples of articles
so selected, whenever
advisable;
. summary of all reports made
(d) Ascertain import costs
of such representative
articles so selected;
. Documents and Assistance
(e) Ascertain the grower's,
producer's or manufacturer's
selling prices in the principal
growing, producing or
manufacturing centers of the
Philippines of the articles of
the Philippines so selected;
and
(h) Submit annual reports
of these to the President of
the Philippines, copy of which
shall be furnished to the
NEDA, Central Bank of
thePhilippines, Department of
Finance and the Board of
Investments.
Sec. 507. Reports of the
Commission. — The
Commission shall place at
the disposal of the President
and any member of the
or its member thereof all
information at its command;
shall make such investigation
and report as may be
required by the President and
the Congress of the
Philippines and shall report to
the President and Congress
on the first Monday of
December of each year
hereafter a statement of
methods adopted and a
during the year.
Sec. 508. Access to
to the Commission. — The
Commission or its duly
authorized representative
shall have access to any
document, paper or record,
pertinent to the subject
matter under investigation, in
the possession of any
person, firm, co-partnership,
or the exercise of any power
of the Bureau of Customs
under this Code, said
document in a foreign
language must be
accompanied with a
translation in the official
language of this country."
Sec. 12. A new Sec. to be
known as Sec. 3518 is
hereby inserted in Part 2,
Title VII of the Tariff and
Customs Code of the
Philippines, as amended,
which shall read as follows:
"Sec. 3518. Records to Be
Kept by Customs. The
Bureau of Customs shall
likewise keep a record of
audit results in a database of
importer and broker profiles,
to include but not be limited
to:
(a) Articles of
Incorporation;
(b) The company
structure, which shall include
but not be limited to:
(1) Incorporators and
Board of Directors;
(2) Key officers; and
(3) Organizational
structure;
(c) Key importations;
shall not preclude goods
otherwise conforming to the
definition from being
regarded as identical.
If, in applying this section,
more than one transaction
value of identical goods are
found, the lowest value shall
be used to determine the
customs value.
Sec. 703. Transaction Value
of Similar Goods - Method
Three. – Where the dutiable
value cannot be determined
under the preceding method,
the dutiable value shall be
the transaction value of
similar goods sold for export
to the Philippines and
exported at or about the
same time as the goods
being valued. For purposes
of this section, "Similar
goods" refer to goods which,
although not alike in all
respects, have like
characteristics and similar
component materials which
enable them to perform the
same functions and to be
commercially
interchangeable. The quality
of the goods, its reputation
and the existence of a
trademark shall be among
the factors to be considered
in determining whether goods
are similar.
 (f) Ascertain all other facts
which will show the
differences in or which affect
competition between articles
of the Philippines and those
imported in the principal
markets of the Philippines.
Sec. 507. Reports of the
Commission. — The
Commission shall place at
the disposal of the President
any member of the Congress
of the Philippines or each
member thereof all
information at its command;
shall make such investigation
and report as may be
required by the President and
the Congress of the
Philippines and shall report to
the President and Congress
on the first Monday of
December of each year
hereafter a statement of
methods adopted and a
corporation or association
engaged in the production,
importation or distribution of
any article under
investigation, and shall have
the power to summon
witnesses, take testimony,
administer oaths, and to
issue subpoena duces tecum
requiring the production of
books, papers or documents
relating to the matter under
investigation. The
Commission may also
request the views,
recommendations and/or
assistance of any
government office, agency or
instrumentality, and such
office, agency or
instrumentality shall
cooperate fully with the
Commission.
Sec. 509. Sworn Statements.
— The Commission may
order the taking of sworn
statements at any stage of
any proceeding or
investigation before it. Such
sworn statements may be
taken before any person
having power to administer
oaths.
Sec. 510. Verified
Statements. — The
Commission is authorized to
require any importer, grower,
producer, manufacturer or
seller to file with the
Commission a statement,
(d) Privileges enjoyed;
(e) Penalties; and
(f) Risk category (ies)."
Sec. 13. Part 3, Title VII of
the Tariff and Customs Code
of the Philippines, as
amended, shall be renamed
as "PROVISIONS ON
PENALTIES".chanrobles
virtualaw library
Sec. 14. Sec. 3604 of Part 3,
Title VII of the Tariff and
Customs Code of the
Philippines, as amended, is
hereby further amended to
read as follows:
"Sec. 3604. Statutory
Offenses of Officials and
Employees. - Every official,
agent or employee of the
Bureau or of any other
agency of the government
charged with the enforcement
of the provisions of this Code,
who is guilty of any
delinquency herein below
indicated shall be punished
with a fine of not less than
Five thousand pesos nor
more than Fifty thousand
pesos and imprisonment for
not less than one year nor
more than ten years and
perpetual disqualification to
hold public office, to vote and
If, in applying this section,
more than one transaction
value of identical goods are
found, the lowest such value
shall be used to determine
the customs value.
Sec. 704. Deductive Value –
Method Four. – Where the
dutiable value cannot be
determined under the
preceding method, the
dutiable value shall be the
deductive value unless
otherwise requested by the
importer as provided in
Section 700 hereof. The
deductive value which shall
be based on the unit price at
which the imported goods or
identical or similar imported
goods are sold in the
Philippines, in the same
condition as when imported,
in the greatest aggregate
quantity, at or about the time
of the importation of the
goods being valued, to
persons not related to the
persons from whom they buy
such goods, subject to
deductions for the following:
(1) Either the commissions
usually paid or agreed to be
paid or the additions usually
made for profit and general
expenses in connection with
sales in such country of
imported goods of the same
class or kind;
summary of all reports made
during the year.
. any article imported, grown,
Sec. 508. Access to
Documents. — The
Commission or its duly
authorized representative
shall have access to any
document, paper or record,
pertinent to the subject
matter under investigation, in
the possession of any
person, firm, co-partnership,
corporation or association
engaged in the production,
importation or distribution of
any article under
investigation, and shall have
power to summon witnesses,
take testimony, administer
oaths, and to issue subpoena
duces tecum requiring the
production or books, papers
or documents relating to the
matter under investigation.
. knowingly demand other or
Sec. 509. Sworn Statements.
— The Commission may
order the taking of sworn
statements at any stage of
under oath, giving his selling
prices in the Philippines of
produced, fabricated or
manufactured by him.
Sec. 511. Rules and
Regulations of the
Commission. — The
Commission shall adopt and
promulgate such rules and
regulations as may be
necessary to carry out the
provisions of this Code.
Sec. 512. Appropriation. —
In addition to its current
appropriation the amount of
Six Hundred Thousand is
hereby appropriated to carry
out the purpose of sections
five hundred one and five
hundred three of this Code.
TITLE III
EXPORT TARIFF AND
PREMIUM DUTY
to participate in any public
election:
(a) Those guilty of
extortion or willful oppression
under color of law;
(b) Those who
knowingly demand other or
greater sums than are
authorized by law or receive
any fee, compensation, or
reward except as by law
prescribed, for the
performance of any duty;
(c) Those who willfully
neglect to give receipts, as
required by law for any sum
collection the performance of
duty, or who willfully neglect
to perform any of the duties
enjoined by law;
(d) Those who
greater sums than are
authorized by law or receive
any fee, compensation, or
reward except as by law
prescribed, for the
performance of any duty;
(e) Those who willfully
make opportunity for any
person to defraud the
customs revenue or who do
or fail to do any act with
intent to enable any person to
defraud said revenue;
(2) The usual costs of
transport and insurance and
associated costs incurred
within the Philippines;
(3) Where appropriate, the
costs of: (i) transport of the
imported goods from the port
of exportation to the port of
entry in the Philippines; (ii)
loading, unloading and
handling charges associated
with the transport of the
imported goods from the
country of exportation to the
port of entry in the
Philippines; and (iii)
insurance; and
(4) The customs duties and
other national taxes payable
in the Philippines by reason
of the importation or sale of
the goods.
If neither the imported goods
nor identical nor similar
imported goods are sold at or
about the time of importation
of the goods being valued in
the Philippines in the
conditions they were
imported, the customs value
shall, subject to the
conditions set forth in the
preceding paragraph, be
based on the unit price at
which the imported goods or
identical or similar imported
goods sold in the Philippines
in the condition they were
imported and at the earliest
any proceeding or
investigation before it. Such
sworn statements may be
taken before any person
having power to administer
oaths.
. export duty on the gross
Sec. 510. Verified
Statements. — The
Commission is authorized to
require any importer, grower,
producer, manufacturer or
seller to file with the
Commission a statement,
under oath, giving his selling
prices in the Philippines of
any article imported, grown,
produced, fabricated or
manufactured by him.
. basic rate, there shall be
Sec. 511. Rules and
Regulations of the
Commission. — The
Commission shall adopt and
promulgate such rules and
regulations as may be
necessary to carry out the
provisions of this Code.
. the column Premium Duty;
Sec. 512. Appropriation. —
The amount of three hundred
thousand pesos is hereby
appropriated to carry out the
purpose of Part 4, Title II,
Book I of this Code.
Subsequent appropriations
shall be provided for in the
succeeding General
Appropriation Act.
Sec. 513. Transitory
Provision. — Upon the
Sec. 514. Export Products
subject to Duty and Rates. —
There shall be levied,
assessed and collected an
F.O.B. value at the time of
shipment based on the
prevailing rate of exchange,
of the following products in
accordance with the schedule
specified in the column
Export Duty.
In addition to the export
duties, herein referred to as
levied, assessed and
collected a premium duty on
the difference between the
current price as established
by the Bureau of Customs
and the base price of the
products in accordance with
the schedule specified under
Provided, That should the
current price of any export
product be below the
established base price, then
only the basic rate shall be
applied: Provided, further,
That, initially, the base price
upon which the premium duty
shall be levied eighty per
centum (80%) of the F.O.B.
value of exports established
by the Bureau of Customs for
February 1974. The National
(f) Those who
negligently or designedly
permit the violation of the law
by any other person;
(g) Those who make or
sign any false entry or entries
in any book, or make or sign
any false certificate or return
in any case where the law
requires the making by them
of such entry, certificate or
return;
(h) Those who, having
knowledge or information of a
violation of the Tariff and
Customs Law or any fraud
committed on the revenue
collectible by the Bureau, fail
to report such knowledge or
information to their superior
official or to report as
otherwise required by law;
(i) Those who, without
the authority of law, demand
or accept or attempt to collect
directly or indirectly as
payment of otherwise, any
sum of money or other thing
of value for the compromise,
adjustment, or settlement of
any charge or complaint for
any violation or alleged
violation of law; or
(j) Those, without
authority of law, disclose
confidential information
gained during any
investigation or audit, or use
date after the importation of
the goods being valued, but
before the expiration of ninety
(90) days after such
importation.
If neither the imported goods
nor identical nor similar
imported goods are sold in
the Philippines in the
condition as imported, then, if
the importer so requests, the
dutiable value shall be based
on the unit price at which the
imported goods, after further
processing, are sold in the
greatest aggregate quantity
to persons in the Philippines
who are not related to the
persons from whom they buy
such goods, subject to
allowance for the value
added by such processing
and deductions provided
under subsections (1), (2), (3)
and (4) hereof.
Sec. 705. Computed Value –
Method Five. – Where the
dutiable value cannot be
determined under the
preceding method, the
dutiable value shall be the
computed value of the sum
of:
(1) The cost or the value of
materials and fabrication or
other processing employed in
producing the imported
goods;
effectivity of this Code the
personnel, funds, equipment,
property and appropriations
of the Tariff Division under
the Department of Finance
are hereby transferred to the
Tariff Commission under this
Code.
Economic and Development such information for personal
Authority shall, from time to gain or to the detriment of the
time, review and establish government, the Bureau or
such base prices taking into third parties."
account, among others, the
cost conditions in various Sec. 15. A new section to be
industries. known as Sec. 3610 is
hereby inserted in Part 3,
Title VII of the Tariff and
Customs Code of the
EXPORT PRODUCTS Philippines, as amended,
EXPORT DUTY 1 which shall read as follows:
"Sec. 3610. Failure to
Keep Importation Records
Wood Products and Give Full Access to
Customs Officers. - Any
1. Logs 20% person who fails to keep all
the records of importations
2. Lumber and/or books of accounts,
3. Veneer business and computer
systems and all customs
4. Plywood commercial data in the
manner prescribed in Part 2,
Mineral Products Sec. 3514 of this Title shall
be punished with a fine of not
1. Metallic ores and less than One hundred
concentrates thousand pesos
(P100,000.00) but not more
a) Copper than Two hundred thousand
pesos (P200,000.00) and/or
b) Iron imprisonment of not less than
c) Chromite two (2) years and one day
but not more than six (6)
2. Gold years. This penalty shall
likewise be imposed against
3. Non-Metallic importers/brokers who deny
an authorized customs officer
a) Clinker, cement full and free access to such
records, books of accounts,
b) Portland cement business and computer
systems, and all customs
(2) The amount for profit and
general expenses equal to
that usually reflected in the
sale of goods of the same
class or kind as the goods
being valued which are made
by producers in the country of
exportation for export to the
Philippines;
(3) The freight, insurance
fees and other transportation
expenses for the importation
of the goods;
(4) Any assist, if its value is
not included under paragraph
(1) hereof; and
(5) The cost of containers
and packing, if their values
are not included under
paragraph (1) hereof.
The Bureau shall not require
or compel any person not
residing in the Philippines to
produce for examination, or
to allow access to, any
account or other record for
the purpose of determining a
computed value. However,
information supplied by the
producer of the goods for the
purposes of determining the
customs value may be
verified in another country
with the agreement of the
producer and provided that
said producer will give
sufficient advance notice to
the government of the
 4. Mineral fuel commercial data including
payment records. This is
a) Bunker fuel oil without prejudice to the
administrative sanctions that
b) Petroleum pitch the Bureau of Customs may
impose against the
5. Silver contumacious importers
under existing laws and
Plant and Vegetable regulations including the
Products authority to hold delivery or
release of their imported
1. Abaca (stripped hemp, articles."
manufactured)
2. Banana Sec. 16. A new section to be
known as Sec. 3611 is
3. Coconut hereby inserted in Part 3,
Title VII of the Tariff and
a) Copra Customs Code of the
Philippines, as amended,
b) Coconut oil which shall read as follows:
c) Copra meal/cake
"Sec. 3611. Failure to Pay
d) Dessicated coconut correct Duties and Taxes on
Imported Goods. - Any
4. Pineapple person who, after being
subjected to post-entry audit
a) Pineapple sliced or and examination as provided
crushed in Sec. 3515 of Part 2, Title
VII hereof, is found to have
b) Pineapple juice or juice incurred deficiencies in duties
concentrate and taxes paid for imported
goods, shall be penalized
5. Sugar and Sugar Products according to three (3)
degrees of culpability subject
a) Centrifugal sugar to any mitigating, aggravating
or extraordinary factors that
b) Molasses are clearly established by the
available evidence:
6. Tobacco
(a) Negligence - When
a) Tobacco leaf the deficiency results from an
offender's failure, through an
country in question and that
the latter does not object to
the investigation.
Sec. 706. Fallback Value–
Method Six. – If the dutiable
value cannot be determined
under the preceding methods
described above, it shall be
determined by using other
reasonable means and on
the basis of data available in
the Philippines. If the
importer so requests, the
importer shall be informed in
writing of the dutiable value
determined under method six
and the method used to
determine such value.
No dutiable value shall be
determined under method six
on the basis of:
(1) The selling price in the
Philippines of goods
produced in the Philippines;
(2) A system that provides for
the acceptance for customs
purposes of the higher of two
(2) alternative values;
(3) The price of goods in the
domestic market of the
country of exportation;
(4) The cost of production,
other than computed values,
that have been determined
for identical or similar goods
 b) Scrap tobacco
Animal Products
1. Shrimp and Prawns
For purposes of computing
the duty, the cost of
packaging and crating
materials shall be deductible
from the export value,
provided such materials are
domestically manufactured
using a substantial portion of
local raw materials, as
determined by the Board of
Investments.
Sec. 515. Flexible Clause. —
The President, upon
recommendation of the
National Economic and
Development Authority, may
subject any of the above
products to higher or lower
rates of duty provided in this
Title, include additional
products, exclude or exempt
any product from this Title, or
additionally subject any
product to an export quota. In
the exercise of this authority
the President shall take into
account: (1) the policy of
encouraging domestic
processing; (2) the prevailing
prices of export products in
the world market; (3) the
advantages obtained by
export products from
act or acts of omission or
commission, to exercise
reasonable care and
competence to ensure that a
statement made is correct, it
shall be determined to be
negligent and punishable by
a fine equivalent to not less
than one-half (1/2) but not
more than two (2) times the
revenue loss.
(b) Gross Negligence -
When a deficiency results
from an act or acts of
omission or commission done
with actual knowledge or
wanton disregard for the
relevant facts and with
indifference to or disregard
for the offender's obligation
under the statute, it shall be
determined to be grossly
negligent and punishable by
a fine equivalent to not less
than two and a half (2 ) but
not more than four(4) times
the revenue loss.
(c) Fraud - When the
material false statement or
act in connection with the
transaction was committed or
omitted knowingly, voluntarily
and intentionally, as
established by clear and
convincing evidence, it shall
be determined to be
fraudulent and be punishable
by a fine equivalent to not
less than five (5) times but
not more than eight (8) times
in accordance with method
five hereof;
(5) The price of goods for
export to a country other than
the Philippines;
(6) Minimum customs values;
or
(7) Arbitrary or fictitious
values.
Sec. 707. Ascertainment of
the Accuracy of the Declared
Value. – Nothing in this
section shall be construed as
restricting or calling into
question the right of the
Bureau to ascertain the truth
or accuracy of any statement,
document or declaration
presented for customs
valuation purposes. When a
declaration has been
presented and when the
Bureau has reason to doubt
the truth or accuracy of the
particulars or of documents
produced in support of such
declaration, it may ask the
importer to provide further
explanation, including
documents or other evidence,
that the declared value
represents the total amount
actually paid or payable for
the imported goods, adjusted
in accordance with the
provisions of Section 701 of
this Act.
international agreements to
which the Philippines is a
signatory; (4) the preferential
treatment granted to our
export products by foreign
governments; and (5) the
need to meet domestic
consumption requirements.
Sec. 516. Assessment and
Collection of the Duty. —
The duty shall be assessed
by the Bureau of Customs
and collected by the Bureau
thru authorized agent banks
of the Central Bank not later
than 30 days from the date of
shipment.
Sec. 517. Deficiency and
Surcharges. — In case the
duty is not fully paid at the
time specified hereof, the
deficiency shall be increased
by an amount equivalent to
twenty-five per centum (25%)
thereof, the total to be
collected in the same manner
as the duty. Where the
deficiency is the result of
false or fraudulent statements
or representations
attributable to the exporter,
the surcharge shall be fifty
per centum (50%).
the revenue loss and
imprisonment of not less than
two (2) years but not more
than eight (8) years.
The decision of the
Commissioner of Customs,
upon proper hearing, to
impose penalties as
prescribed in this Sec. may
be appealed in accordance
with Sec. 2402 hereof."
Sec. 17. The following
provisions of the Tariff and
Customs Code of the
Philippines, as amended, are
renumbered as follows:
(a) Sec. 3514 of Part 2,
Title VII ("Words and Phrases
Defined") is renumbered as
Sec. 3519; and
(b) Sec. 3610 of Part 3,
Title VII ("Violations of Tariff
and customs Laws and
Regulations in General") is
renumbered as Sec. 3612.
Sec. 18. Rules and
Regulations. - The Secretary
of Finance shall, upon the
recommendation of the
Commissioner of Customs,
promulgate the necessary
rules and regulations for the
effective implementation of
this Act.
Sec. 19. Repealing Clause. -
All laws, decrees, executive
If in the course of determining
the dutiable value of imported
goods, it becomes necessary
to delay the final
determination of such
dutiable value, the importer
shall nevertheless be able to
secure the release of the
imported goods upon posting
of a sufficient security in an
amount equivalent to the
duties and taxes in dispute
conditioned on the payment
of additional duties and
taxes, if any, as may be
determined: Provided, That
prohibited goods shall not be
released under any
circumstance.
If, after receiving further
information, or in the absence
of a response, the Bureau
still has reasonable doubts
on the truth or accuracy of
the declared value, it may
deem that the customs value
of the imported goods cannot
be determined under method
one, without prejudice to an
importer's right to appeal
pursuant to Section 1104 of
this Act. Before taking a final
decision, the District Collector
shall communicate to the
importer, in writing if
requested, the grounds for
doubting the truth or
accuracy o£ the particulars or
documents produced and
give the importer a
reasonable opportunity to
Sec. 518. Allotment and
Disposition of the Proceeds.
— The proceeds of this duty
shall accrue to the General
Fund and shall be allotted for
development projects; except
that one per centum (1%)
annually shall be set aside for
the Export Assistance Fund
to be administered by the
Board of Investments and
expended in accordance with
the General Appropriations
Act to finance export
promotion projects; however,
thirty per cent of this 1% shall
accrue to the Bureau of
Customs which shall
constitute as its intelligence
fund to be disbursed by the
Commissioner of Customs in
the implementation of this
Title, such as but not limited
to the purchase of
equipment, hiring of
personnel if necessary and
for such other operational
expenses in the promotion of
the export industry.
Sec. 519. Rules and
Regulations. — The
Commissioner of Customs
shall promulgate the rules
and regulations necessary for
the implementation of this
Title, subject to the approval
of the Secretary of Finance.
orders, rules and regulations
and other issuances or parts
thereof which are
inconsistent with this Act are
hereby repealed or modified
accordingly.
Sec. 20. Effectivity. - This Act
shall take effect fifteen (15)
days after its publication in
the Official Gazette or in any
two (2) newspapers of
general circulation, whichever
date comes earlier.
respond. When a final
decision is made, the Bureau
shall communicate its
decision, and the grounds
therefor in writing.
Sec. 708. Exchange Rate. –
For the assessment and
collection of import duty upon
imported goods and for other
purposes, the value and
prices thereof quoted in
foreign currency shall be
converted into the currency of
the Philippines at the current
rate of exchange or value
specified or published, from
time to time, by the Bangko
Sentral ng Pilipinas (BSP).
CHAPTER 2
SPECIAL DUTIES AND
TRADE REMEDY
MEASURES
Sec. 709. Government's
Right of Compulsory
Acquisition. – In order to
protect government revenues
against undervaluation of
goods, the Commissioner
may, motu proprio or upon
the recommendation of the
District Collector, acquire
imported goods under
question for a price equal to
their declared customs value
plus any duties already paid
on the goods, payment for
which shall be made within
ten (10) working days from
issuance of a warrant signed
by the Commissioner for the
acquisition of such goods.

An importer who is
dissatisfied with a decision of
the Commissioner pertaining
to this section may, within
twenty (20) working days
after the date on which notice
of the decision is given,
appeal to the Secretary of
Finance, and thereafter If still
dissatisfied, to the CTA as
provided for in Section 1136
of this Act.

Where no appeal is made by

the importer, or upon
reaffirmation of the
Commissioner's decision
during the appeals process,
the Bureau or its agents shall
sell the acquired goods
pursuant to existing laws and
regulations.

Nothing in this section limits

or affects any other powers of
the Bureau with respect to
the disposition of the goods
or any liability of the importer
or any other person with
respect to an offense
committed in the importation
of the goods.

Sec. 710. Marking of

Imported Goods and
Containers. – (A) Marking of
Goods, – Except as
hereinafter provided, all
 goods of foreign origin
imported into the Philippines
or their containers, as
provided in subsection (B)
hereof shall be conspicuously
marked in any official
language of the Philippines
as legibly, indelibly and
permanently as the nature of
the goods or container will
permit and in such manner as
to indicate to an ultimate
purchaser in the Philippines
the name of the country of
BOOK II origin of the goods. Pursuant
CUSTOMS LAW thereto, the Commissioner
shall, with the approval of the
Secretary of Finance:

TITLE I (1) Determine the character

THE BUREAU OF
CUSTOMS
PART 1
ORGANIZATION,
FUNCTION AND
JURISDICTION OF THE
BUREAU
Section 601. Chief Officials of
Bureau of Customs. — The
Bureau of Customs shall
have one chief and one
assistant chief, to be known
respectively at the
Commissioner (hereinafter
known as the
"Commissioner") and
of words and phrases or
abbreviation thereof which
shall be acceptable as
indicating the country of
origin and prescribe any
reasonable method of
marking, whether by printing,
stenciling, stamping,
branding, labeling or by any
other reasonable method,
and in a conspicuous place
on the goods or container
where the marking' shall
appear;
(2) Require the addition of
other words or symbols which
may be appropriate to
prevent deception or mistake
as to the origin of the goods
or as to the origin of any
other goods with which such
Assistant Commissioner of
Customs, who shall each
receive an annual
compensation in accordance
with the rates prescribed by
existing laws. The Assistant
Commissioner of Customs
shall be appointed by the
proper department head.
Sec. 602. Functions of the
Bureau. — The general
duties, powers and
jurisdiction of the bureau
shall include:
a. The assessment and
collection of the lawful
revenues from imported
articles and all other dues,
fees, charges, fines and
penalties accruing under the
tariff and customs laws.
b. The prevention and
suppression of smuggling
and other frauds upon the
customs.
c. The supervision and
control over the entrance and
clearance of vessels and
aircraft engaged in foreign
commerce.
d. The general supervision,
control and regulation of
vessels engaged in the
carrying of passengers and
freight or in towage in
coastwise trade and in the
imported goods is usually
combined subsequent to
importation but before
delivery to an ultimate
purchaser; and
(3) Authorize the exception of
any goods from the
requirements of marking if:
(i) Such goods are incapable
of being marked;
(ii) Such goods cannot be
marked prior to shipment to
the Philippines without injury;
(iii) Such goods cannot be
marked prior to shipment to
the Philippines, except at an
expense economically
prohibitive of their
importation;
(iv) The marking of a
container of such goods will
reasonably indicate the origin
of such goods;
(v) Such goods are crude
substances;
(vi) Such goods are imported
for use by the importer and
not intended for sale in their
imported or any other form;
(vii) Such goods are to be
processed in the Philippines
by the importer or for the
importer's account other than
for the purpose of concealing
bays and rivers of the
Philippines.
e. The prohibition and
suppression of unnecessary
noises, such as explosion of
gasoline engines, the
excessive blowing of whistles
or sirens, and other needless
and disturbing sounds made
by water craft in the ports of
the Philippines or in parts of
rivers included in such ports.
f. The exclusion, if the
conditions of traffic should at
any time so require, of
vessels of more than one
hundred and fifty tons from
entering, berthing or mooring
in the Pasig River.
g. The admeasurement,
registration, documenting and
licensing of vessels built or
owned in the Philippines, the
recording of sales, transfers
and encumbrances of such
vessels, and the performance
of all the duties pertaining to
marine registry.
h. The inspection of
Philippine vessels, and
supervision over the safety
and sanitation of such
vessels.
i. The enforcement of the
lawful quarantine regulations
for vessels entering
Philippine ports.
the origin of such goods and
in such manner that any mark
contemplated by this section
would necessarily be
obliterated, destroyed, or
permanently concealed;
(viii) An ultimate purchaser,
by reason of the character of
such goods or by reason of
the circumstances of their
importation, must necessarily
know the country of origin of
such goods even though they
are not marked to indicate
their origin;
(ix) Such goods were
produced more than twenty
(20) years prior to their
importation into the
Philippines; or
(x) Such goods cannot be
marked after importation
except at an expense which
is economically prohibitive,
and the failure to mark the
goods before importation was
not due to any purpose of the
importer, producer, seller or
shipper to avoid compliance
with this section.
(B) Marking of Containers. –
Whenever goods are exempt
under paragraph (3) of
subsection (A) of this section
from the requirements of
marking, the immediate
container, if any, of such
goods, or such other

j. The enforcement of the
tariff and customs laws and
all other laws, rules and
regulations relating to the
tariff and customs
administration.
k. The licensing of marine
officers who have qualified in
the examination required by
law to be carried on
Philippine vessels, the
determination of the
qualifications of pilots, the
regulation of this service, and
the fixing of the fees which
they may charge.
l. The supervision and
control over the handling of
foreign mails arriving in the
Philippines, for the purpose
of the collection of the lawful
duty on dutiable articles thus
imported and the prevention
of smuggling through the
medium of such mails.
Sec. 603. Territorial
Jurisdiction. — For the due
and effective exercise of the
powers conferred by law and
to the extent requisite
therefor, said bureau shall
have the right of supervision
and police authority over all
seas within the jurisdiction of
the Philippines and over all
coasts, ports, airports,
harbors, bays, rivers and
container or containers of
such goods, shall be marked
in such manner as to indicate
to an ultimate purchaser in
the Philippines the name of
the country of origin of such
goods in any official language
of the Philippines, subject to
all provisions of this section,
including the same
exceptions as are applicable
to goods under paragraph (3)
of subsection (A).
(C) Pine for Failure to Mark. –
If, at the time of importation
any good or its container, as
provided in subsection (B)
hereof, is not marked in
accordance with the
requirements of this section,
there shall be levied,
collected, and paid upon
such good a marking duty of
five percent (5%) of dutiable
value, which shall be deemed
to have accrued at the time of
importation,
(D) Release Withheld Until
Marked. – No imported goods
held in customs custody for
inspection, examination, or
assessment shall be released
until such goods or their
containers shall have been
marked in accordance with
the requirements of this
section and until the amount
of duty estimated to be
payable under subsection (C)
inland waters navigable from
the sea.
When a vessel becomes
subject to seizure by reason
of an act done in Philippine
waters in violation of the tariff
and customs laws, a pursuit
of such vessel begun within
the jurisdictional waters may
continue beyond the maritime
zone, and the vessel may be
seized on the high sea.
Imported articles which may
be subject to seizure for
violation of the tariff and
customs laws may be
pursued in their
transportation in the
Philippines by land, water or
air and such jurisdiction
exerted over it at any place
therein as may be necessary
for the due enforcement of
the law.
Sec. 604. Jurisdiction over
Premises Used for Customs
Purposes. — The Bureau of
Customs shall, for customs
purposes, have exclusive
control, direction and
management of custom-
houses, warehouses, offices,
wharves, and other premises
in the respective ports of
entry, in all cases without
prejudice to the general
police powers of the city or
municipality wherein such
premises are situated.
of this section shall have
been deposited.
(E) The failure or refusal of
the owner or importer to mark
the goods as herein required
within a period of thirty (30)
days after due notice shall
constitute as an act of
abandonment of said goods
and their disposition shall be
governed by the provisions of
this Act relative to
abandonment of imported
goods.
Sec. 711. Dumping Duty. –
The provisions of Republic
Act No. 8752, otherwise
known as the "Anti-Dumping
Act of 1999", are hereby
adopted.
Sec. 712. Safeguard Duty. –
The provisions of Republic
Act No. 8800, otherwise
known as the "Safeguard
Measures Act", are hereby
adopted.
Sec. 713. Countervailing
Duty. –
The provisions of Republic
Act No. 8751, otherwise
known as "An Act
Strengthening the
Mechanisms for the
Imposition of Countervailing
Duties on Imported
Subsidized Products,

chan robles vi rtual law
library
Sec. 605. Enforcement of
Port Regulation of Bureau of
Quarantine. — Customs
officials and employees shall
cooperate with the quarantine
authorities in the enforcement
of the port quarantine
regulations promulgated by
the Bureau of Quarantine and
shall give effect to the same
in so far as they are
connected with matters of
shipping and navigation.
Sec. 606. Power of the
President to Subject
Premises to Jurisdiction of
Bureau of Customs. — When
any public wharf, landing
place, street or land, not
previously under the
jurisdiction of the Bureau of
Customs, in any port of entry,
is necessary or desirable for
any proper customs purpose,
the President of the
Philippines may, by executive
order, declare such premises
to be under the jurisdiction of
the Bureau of Customs, and
thereafter the authority of
such Bureau in respect
thereto shall be fully effective.
Sec. 607. Annual Report of
Commissioner. — The
Commodities or Articles of
Commerce in Order to
Protect Domestic Industries
from Unfair Trade
Competition, Amending for
the Purpose Section 302,
Part 2, Title II, Book I of
Presidential Decree No.
1464", otherwise known as
the "Tariff and Customs Code
of the Philippines, as
Amended", are hereby
adopted.
Sec. 714. Discrimination by
Foreign Countries. – Without
prejudice to the Philippine
commitment in any ratified
international agreements or
treaty, the following recourse
shall be applicable in case of
discrimination by foreign
countries:
(a) When the President finds
that the public interest will be
served thereby, the President
shall, by proclamation,
specify and declare new or
additional duties in an
amount not exceeding one
hundred percent (100%) ad
valorem upon goods wholly
or in part the growth or
product of, or imported in a
vessel of any foreign country
whenever the President shall
find as a fact that such
country:
(1) Imposes, directly or
indirectly, upon the
annual report of the
Commissioner shall, among
other things, contain a
compilation of the (a) volume
and value of articles imported
into the Philippines and the
corresponding customs
duties assessed and
collected thereon itemized in
accordance with the tariff
classification provided in this
Code and (b) volume and
value of articles exported
from the Philippines for the
preceding year.
Sec. 608. Commissioner to
Make Rules and Regulations.
— The Commissioner shall,
subject to the approval of the
department head, make all
rules and regulations
necessary to enforce the
provisions of this Code.
PART 2
COLLECTION DISTRICTS
AND PORTS OF ENTRY
Sec. 701. Collection Districts
and Ports of Entry thereof—
For administrative purposes,
the Philippines shall be
divided into as many
collection districts as there
are at present existing, the
respective limits of which
may be changed from time to
disposition or transportation
in transit or through
reexportation from such
country of any goods wholly
or in part the growth or
product of the Philippines,
any unreasonable charge,
exaction, regulation or
limitation which is not equally
enforced upon the like goods
of every foreign country; or
(2) Discriminates in fact
against the commerce of the
Philippines, directly or
indirectly, by law or
administrative regulation or
practice, by or in respect to
any customs, tonnage, or
port duty, fee, charge,
exaction, classification,
regulation, condition,
restriction or prohibition, in
such manner as to place the
commerce of the Philippines
at a disadvantage compared
with the commerce of any
foreign country.
(b) If at any time the
President shall find it to be a
fact that any foreign country
has not only discriminated
against the commerce of the
Philippines, as aforesaid, but
has, after the issuance of a
proclamation as authorized in
subsection (a) of this section,
maintained or increased its
said discrimination against
the commerce of the
Philippines, the President is
time by the Commissioner,
upon the approval of the
department head. The
principal ports of entry for the
respective collection districts
shall be Manila, Sual,
Tabaco, Cebu, Pulupandan,
Sia-in, Iloilo, Davao, Legaspi,
Zamboanga, Jolo, Aparri,
Jose Panganiban, Cagayan,
Cagayan, Tacloban, San
Fernando, Hinigaran,
Dumaguete City and
Batangas.
Sec. 702. Power of the
President to Open and Close
Subports. — Subports of
entry may be opened or
closed by executive order, in
the discretion of the
President of the Philippines.
When a subport is closed, its
existing personnel shall be
reassigned to other duties by
the Commissioner subject to
the approval of the
department head.
Sec. 703. Collector of
Customs at Port of Entry. —
At each principal port of entry
there shall be a Collector of
Customs (hereinafter known
as the "Collector") who shall
be responsible to the
Commissioner, and who shall
be the official head of the
hereby authorized, if deemed
consistent with the interests
of the Philippines and of
public interest, to issue a
further proclamation directing
that such product of said
country or such goods
imported in their vessels be
excluded from importation
into the Philippines.
(c) Any proclamation issued
by the President under this
section shall, if the President
deems it consistent with the
interest of the Philippines,
extend to the whole of any
foreign country or may be
confined to any subdivision or
subdivisions thereof:
Provided, That the President
may, whenever the public
interest requires, suspend,
revoke, supplement or
amend any such
proclamation.
(d) All goods imported
contrary to the provisions of
this section shall be forfeited
to the government of the
Philippines and shall be liable
to be seized, prosecuted and
condemned in like manner
and under the same
regulations, restrictions, and
provisions as may from time
to time be established for the
recovery, collection,
distribution, and remission or
forfeiture to the government
by the tariff and customs
customs service in his port
and district. The Collector
shall have jurisdiction over all
matters arising from the
enforcement of tariff and
customs laws within his
collection district: Provided,
however, That the
Commissioner shall have the
authority to review any such
action upon appeal as
provided in section two
thousand three hundred and
thirteen of this Code. No
appointment to any position
under the Collector shall be
made without the
recommendation of the
Collector concerned.
Sec. 704. Seal of Collector of
Customs. — In the office of
the Collector of a collection
district there shall be kept a
seal of such design as the
Commissioner shall describe,
with the approval of the
department head, with which
shall be sealed all documents
and records requiring
authentication in such office.
Sec. 705. Authority of
Assistant or Deputy
Collectors of Customs. — An
assistant collector at a
principal port of entry may, in
the name of the Collector and
subject to his supervision and
control, perform any
particular act which might be
done by the Collector himself;
laws. Whenever the provision
of this section shall be
applicable to importations
into the Philippines of goods
wholly or in part the growth or
product of any foreign
country, it shall be applicable
thereto, whether such goods
are imported directly or
indirectly.
(e) It shall be the duty of the
Commission to ascertain and
at all times be informed
whether any of the
discriminations against the
commerce of the Philippines
enumerated in subsections
(a) and (b) of this section are
practiced by any country; and
if and when such
discriminatory acts are
disclosed, it shall be the duty
of the Commission to bring
the matter to the attention of
the President, and to
recommend measures to
address such discriminatory
acts.
(f) The Secretary of Finance
shall make such rules and
regulations as are necessary
for the execution of a
proclamation that the
President may issue in
accordance with the
provisions of this section.
TITLE VIII
at subports, a deputy
collector may, in his own
name, exercise the general
powers of a collector, subject
to the supervision and control
of the Collector of the port.
Sec. 706. Appointment of
Special Deputies with Limited
Powers. — Collectors may,
with the approval of the
Commissioner, appoint from
their force such number of
special deputies as may be
necessary for the proper
conduct of the public
business, with authority to
sign such documents and
perform such service as may
be specified in writing.
Sec. 707. Succession of
Assistant or Deputy Collector
to Position of Acting
Collector. — In the absence
or disability of a Collector at
any port or in case of a
vacancy in his office, the
temporary discharge of his
duties shall devolve upon the
assistant or deputy collector
of the port. Where no
assistant or deputy collector
is available, an official to
serve in such contingency
may be designated in writing
by the Collector from his own
force. The Collector making
such designation shall report
the same without delay to the
Commissioner and the
Auditor General, forwarding
TAX AND DUTY
DEFERMENT,
PREFERENCE AND
EXEMPTION
CHAPTER 1
CONDITIONALLY TAX
AND/OR DUTY-EXEMPT
IMPORTATION
Sec. 800. Conditionally Tax
and/or Duty-Exempt
Importation. – The following
goods shall be exempt from
the payment of import duties
upon compliance with the
formalities prescribed in the
regulations which shall be
promulgated by the
Commissioner with the
approval of the Secretary of
Finance: Provided, That
goods sold, bartered, hired or
used for purposes other than
what they were intended for
and without prior payment of
the duty, tax or other charges
which would have been due
and payable at the time of
entry if the goods had been
entered without the benefit of
this section, shall be subject
to forfeiture and the
importation shall constitute a
fraudulent practice against
customs laws: Provided,
however, That a sale
pursuant to a judicial order or
in liquidation of the estate of
a deceased person shall not
be subject to the preceding
to them the signature of the
person so designated.
Sec. 708. Designation of
Official as Customs
Inspector. — At a coastwise
port where no customs
official or employee is
regularly stationed, the
Commissioner may designate
any national, provincial or
municipal official of the port
to act as an inspector of
customs for the purpose of
enforcing the laws and
regulations of the Bureau of
Customs in the particular
port; but all such
designations shall be made
with the consent of the proper
department head of the
official so designated.
Sec. 709. Authority of
Collector to Remit Duties. —
A Collector shall have
discretionary authority to
remit the assessment and
collection of customs duties,
taxes and other charges
when the aggregate amount
of such duties, taxes and
other charges is less than ten
pesos, and he may dispense
with the seizure of articles of
less than ten pesos in value
except in cases of prohibited
importations or the habitual
or intentional violation of the
tariff and customs laws.
proviso, without prejudice to
the payment of duties, taxes
and other charges: Provided,
further, That the President
may, upon the
recommendation of the
Secretary of Finance,
suspend, disallow or
completely withdraw, in
whole or in part, any
conditionally free importation
under this section:
(a) Aquatic products such as
fishes, crustaceans,
mollusks, marine animals,
seaweeds, fish oil, roe,
caught or gathered by 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;
(b) Equipment for use in the
salvage of vessels or
aircrafts, not available locally,
upon identification and the
giving of a security in an
amount equal to one hundred
percent (100%) of the
ascertained duties, taxes and
other charges thereon,
conditioned for the
exportation thereof or
payment of corresponding
Sec. 710. Records to be kept
by Customs Officials. —
Collectors, assistant
collectors, deputy collectors,
surveyors, and other customs
officials acting in such
capacities are required to
keep true, correct and
permanent records of their
official transactions, to submit
the same to the inspection of
authorized officials at all
times, and to turn over all
records and official papers to
their successors or other
authorized officials.
Sec. 711. Port Regulation. —
A Collector may prescribe
local administrative
regulations, not inconsistent
with law or the general
bureau regulations, for the
government of his port or
district, the same to be
effective upon approval by
the Commissioner.
Sec. 712. Reports of
Collector to Commissioner.
— A Collector shall make
report to the Commissioner
from time to time concerning
prospective or newly begun
litigation in his district
touching matters relating to
the customs service; and he
shall, in such form and detail
as shall be required by the
Commissioner, make regular
monthly reports of all
duties, taxes and other
charges within six (6) months
from the date of acceptance
of the goods declaration:
Provided, That the Bureau
may extend the time for
exportation or payment of
duties, taxes and other
charges for a term not
exceeding sis (6) months
from the expiration of the
original period;
(c) Cost of repairs, excluding
the value of the goods used,
made in foreign countries
upon vessels or aircraft
documented, registered or
licensed in the Philippines,
upon proof satisfactory to the
Bureau: (1) that adequate
facilities for such repairs are
not afforded in the
Philippines; or (2) that such
vessels or aircrafts, while in
the regular course of their
voyage or flight, were
compelled by stress of
weather or other casualty to
put into a foreign port to
make such repairs in order to
secure the safety,
seaworthiness, or
airworthiness of the vessels
or aircrafts to enable them to
reach their port of
destination;
(d) Goods brought into the
Philippines for repair,
processing or reconditioning
to be reexported upon
transactions in his port and
district.
completion of the repair,
processing or reconditioning:
Provided, That the Bureau
shall require security equal to
one hundred percent (100%)
of the duties, taxes and other
charges thereon, conditioned
for the exportation thereof or
payment of the
corresponding duties, taxes
and other charges within six
(6) months from the date of
acceptance of the goods
declaration;
(e) Medals, badges, cups,
and other small goods
bestowed as trophies or
prizes, or those received or
accepted as honorary
distinction;
(f) Personal and household
effects belonging to returning
residents including household
appliances, jewelry, precious
stones, and other goods of
luxury which were formally
declared and listed before
departure and identified
under oath before the District
Collector when exported from
the Philippines by such
returning residents upon their
departure therefrom or during
their stay abroad; personal
and household effects
including 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 by residents of the
Philippines which were
necessary, appropriate, and
normally used for their
comfort and convenience
during their stay abroad,
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 the owner's return.

For purposes of this section,

the phrase "returning
residents" shall refer to
nationals who have stayed in
a foreign country for a period
of at least sis (6) months.
Returning residents shall
have tax and duty exemption
on personal and household
effects: Provided, That:

(1) It shall not be in

commercial quantities;

(2) It is not intended for

barter, sale or for hire; and

(3) Limited to the FCA or

FOB value of:

(i) Three hundred fifty

thousand pesos
(P350,000.00) for those who
have stayed in a foreign
country for at least ten (10)
years and have not availed of
this privilege within ten (10)
years prior to returning
resident's arrival;

(ii) Two hundred fifty

thousand pesos
(P250,000.00) for those who
have stayed in a foreign
country for a period of at
least five (5) but not more
than ten (10) years and have
not availed of this privilege
within five (5) years prior to
returning resident's arrival; or

(iii) One hundred fifty

thousand pesos
(P150,000.00) for those who
have stayed in a foreign
country for a period of less
than five (5) years and have
not availed of this privilege
within six (6) months prior to
returning resident's arrival.

Any amount in excess of the

above-stated threshold shall
be subject to the
corresponding duties and
taxes under this Act.

Every three (3) years after

the effectivity of this Act, the
Secretary of Finance shall
adjust the amount herein
stated to its present value
using the CPI as published
by the PSA.
In addition to the privileges
granted under the
immediately preceding
paragraph, returning
Overseas Filipino Workers
(OFWs) shall have the
privilege to bring in, tax and
duty-free, home appliances
and other durables, 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: Provided, That
any amount in excess of FCA
value of one hundred fifty
thousand pesos
(P150,000.0,0) for personal
and household effects or of
the number of duty-free
appliances as provided for
under this section, shall be
subject to the corresponding
taxes and duties: Provided,
further, That every three (3)
years after the effectivity of
this Act, the Secretary of
Finance shall adjust the
amount herein stated to its
present value using the CPI
as published by the PSA;

(g) Residents of the

Philippines, OFWs or other
Filipinos while residing
abroad or upon their return to
the Philippines 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:
Provided, That balikbayan
boxes shall contain personal
and household effects only
and shall neither be in
commercial quantities nor
intended for barter, sale or for
hire and that the FCA value
of which shall not exceed one
hundred fifty thousand pesos
(P150,000.00): Provided,
further, That every three (3)
years after the effectivity of
this Act, the Secretary of
Finance shall adjust the
amount herein stated to its
present value using the CPI
as published by the PSA:
Provided, finally, That
residents of the Philippines,
OFWs or other Filipinos can
only avail of this privilege up
to three (3) times in a
calendar year. Any amount in
excess of the allowable non-
dutiable value shall be
subject to the applicable
duties and taxes;

(l) For purposes of this Act,

OFWs refer to holders of
valid passports duly issued
by the Department of Foreign
Affairs (DFA) and certified by
the Department of Labor and
Employment (DOLE) or the
Philippine Overseas
Employment Administration
(POEA) for overseas
employment purposes. They
cover all Filipinos, working in
a foreign country under
employment contracts,
regardless of their
professions, skills or
employment status in a
foreign country; and (2)
Calendar Year refers to the
period from January 1 to
December 31.

(h) Wearing apparel, goods

of personal adornment, toilet
goods, portable tools and
instruments, theatrical
costumes and similar effects
accompanying travelers, or
tourists, or arriving within a
reasonable time before or
after their arrival in the
Philippines, which, are
necessary and appropriate
for the wear and use of such
persons according to the
nature of the journey, their
comfort and convenience:
Provided, That this
exemption shall not apply to
goods intended for other
persons or for barter, sale or
hire: Provided, however, That
the Bureau may require
either a written commitment
or a security in an amount
equal to one hundred percent
(100%) of the ascertained
duties, taxes and other
charges thereon, conditioned
for the exportation thereof or
payment of the
corresponding duties, taxes
and other charges within
three (3) months from the
date of acceptance of the
goods declaration: Provided,
further, That the Bureau may
extend the time for
exportation or payment of
duties, taxes and other
charges for a term not
exceeding three (3) months
from the expiration of the
original period.

Personal and household

effects and vehicles
belonging to foreign
consultants and experts hired
by, or rendering service to,
the government, and their
staff or personnel and
families accompanying them
or arriving within a
reasonable time before or
after their arrival in the
Philippines, in quantities and
of the kind necessary and
suitable to the profession,
rank or position of the person
importing said items, for their
own use and not for barter,
sale or hire: Provided, That
the Bureau may require
either a written commitment
or a security in an amount
equal to one hundred percent
(100%) of the ascertained
duties, taxes and other
charges thereon, upon the
goods classified under this
subsection; conditioned for
the exportation thereof or
payment of the
corresponding duties, taxes
and other charges within
three (3) months after the
expiration of their term or
contract: Provided, however,
That the Bureau may extend
the time for exportation or
payment of duties, taxes and
other charges for a term not
exceeding three (3) months
from the expiration of the
original period;

(i) Professional instruments

and implements, tools of
trade, occupation or
employment, wearing
apparel, domestic animals,
and personal and household
effects belonging to persons
coming to settle in the
Philippines or Filipinos or
their families and
descendants who are now
residents or citizens of other
countries, such parties
hereinafter referred to as
overseas Filipinos, in
quantities and of the class
suitable to the profession,
rank or position of the
persons importing said items,
for their own use and not for
barter or sale, accompanying
such persons, or arriving
within a reasonable time:
Provided, That the Bureau
may, upon the production of
satisfactory evidence that
such persons are actually
coming to settle in the
Philippines and that the
goods are brought from their
former place of abode,
exempt such goods from the
payment of duties and taxes:
Provided, further, That
vehicles, vessels, aircrafts,
machineries and other similar
goods for use in
manufacture, shall not fall
within this classification and
shall therefore be subject to
duties, taxes and other
charges;

(j) Goods used exclusively for

public entertainment, and for
display in public expositions,
or for exhibition or
competition for prizes, and
devices for projecting
pictures and parts and
appurtenances thereof, upon
identification, examination,
and appraisal and the giving
of a security in an amount
equal to one hundred percent
(100%) of the ascertained
duties, taxes and other
charges thereon, conditioned
for exportation thereof or
payment of the
corresponding duties, taxes
and other charges within
three (3) months from the
date of acceptance of the
goods declaration: Provided,
That the Bureau may extend
the time for exportation or
payment of duties, taxes and
other charges for a term not
exceeding three (3) months
from the expiration of the
original period; and technical
and scientific films when
imported by technical,
cultural and scientific
institutions, and not to be
exhibited for profit: Provided,
further, That if any of the
films is exhibited for profit,
the proceeds therefrom shall
be subject to confiscation, in
addition to the penalty
provide under this Act;

(k) Goods brought by foreign

film producers directly and
exclusively used for mailing
or recording motion picture
films on location in the
Philippines, upon their
identification, examination
and appraisal and the giving
of a security in an amount
equal to one hundred percent
(100%) of the ascertained
duties, taxes and other
charges thereon, conditioned
for exportation thereof or
payment of the
corresponding duties, taxes
and other charges within
three (3) months from the
date of acceptance of the
goods declaration, unless
extended by the District
Collector for another three (3)
months; photographic and
cinematographic films,
underdeveloped, exposed
outside the Philippines by
resident Filipino citizens or by
producing companies of
Philippine registry where the
principal actors and artists
employed for the production
are Filipinos, upon affidavit
by the importer and
identification that such
exposed films are the same
films previously exported
from the Philippines, As used
in this paragraph, the terms
"actors" and "artists" include
the persons operating the
photographic camera or other
photographic and sound
recording apparatus by which
the film is made;

(l) Importations for the official

use of foreign embassies,
legations and other agencies
of foreign governments:
Provided, That those foreign
countries accord like
privileges to corresponding
agencies of the Philippines.
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,
however, That such privilege
shall be accorded under
special agreements between,
the Philippines and the
countries which they
represent: Provided, further,
That the privilege may be
granted only upon specific
instructions of the Secretary
of Finance pursuant to an
official request of the DFA on
behalf of members or
attaches of foreign
embassies, legations,
consular officers and other
representatives of foreign
governments.

(m) Imported goods donated

to or, for the account of the
Philippine government or any
duly registered relief
organization, not operated for
profit, for free distribution
among the needy, upon
certification by the DSWD or
the Department of Education
(DepED), or the Department
of Health (DOH), as the case
may be;

(n) Containers, holders and

other similar receptacles of
any material including kraft
paper bags for locally
manufactured cement for
export, including corrugated
boxes for bananas, mangoes,
pineapples and other fresh
fruits for export, except other
containers made of paper,
paperboard and textile
fabrics, which are of such
character as to be readily
identifiable and/or reusable
for shipment or transportation
of goods shall be delivered to
the importer thereof upon
identification, examination
and appraisal and the giving
of a security in an amount
equal to one hundred percent
(100%) of the ascertained
duties, taxes and other
charges thereon, within six
(6) months from the date of
acceptance of the goods
declaration;

(o) Supplies which are

necessary for the reasonable
requirements of the vessel or
aircraft in its voyage or flight
outside the Philippines,
including goods transferred
from a bonded warehouse in
any Customs District to any
vessel or aircraft engaged in
foreign trade, for use or
consumption of the
passengers or its crew on
board such vessel or aircraft
as sea or air stores; or goods
purchased abroad for sale on
board a vessel or aircraft as
saloon stores or air store
supplies: Provided, That any
surplus or excess of such
vessel or aircraft supplies
arriving from foreign ports or
airports shall be dutiable;

(p) Goods and salvage from,

vessels recovered after a
period of two (2) years from
the date of filing the marine
protest or the time when the
vessel was wrecked or
abandoned, or parts of a
foreign vessel or its
equipment, wrecked or
abandoned in Philippine
waters or elsewhere:
Provided, That goods and
salvage recovered within the
said period of two (2) years
shall be dutiable;

(q) Coffins or urns containing

human remains, bones or
ashes, used personal and
household effects (not
merchandise) of the
deceased person, except
vehicles, the FCA value of
which does not exceed one
hundred fifty thousand pesos
(P15 0,000.00), upon
identification as such:
Provided, That every three
(3) years after the effectivity
of this Act, the value herein
stated shall be adjusted to its
present value using the CPI
as published by the PSA;

(r) Samples of the kind, in

such quantity and of such
dimension or construction as
to render them unsaleable or
of no commercial value;
models not adapted for
practical use; and samples of
medicines, properly marked
"sample-sale punishable by
law", for the purpose of
introducing new goods in the
Philippine market and
imported only once in a
quantity sufficient for such
purpose by a person duly
registered and identified to be
engaged in that trade:
Provided, That importations
under this subsection shall be
previously authorized by the
Secretary of Finance:
Provided, however, That
importation of sample
medicines shall have been
previously authorized by the
Secretary of Health, and that
such samples are new
medicines not available in the
Philippines; Provided, further,
That samples not previously
authorized or properly
marked in accordance with
this section shall be levied
the corresponding tariff duty.

Commercial samples, except

those that are not readily and
easily identifiable as in the
case of precious and semi-
precious stones, cut or uncut,
and jewelry set with precious
or semi-precious stones, the
value of any single
importation of which does not
exceed FCA value of fifty
thousand pesos (P50.000.00)
upon the giving of a security
in an amount equal to the
ascertained duties, taxes and
other charges thereon,
conditioned for the
exportation of said samples
within three (3) months from
the date of the acceptance of
the goods declaration or in
default thereof, the payment
of the corresponding duties,
taxes and other charges:
Provided, That if the FCA
value of any single
consignment of such
commercial samples exceeds
fifty thousand pesos
(P50,000.00), the importer
thereof may select any
portion of the same not
exceeding the FCA value of
fifty thousand pesos
(P50.000.00) for entry under
the provision of this
subsection, and the excess of
the consignment may be
entered in bond, or for
consumption, as the importer
may elect: Provided, further.
That every three (3) years
after the effectivity of this Act,
the Secretary of Finance
shall adjust the amount
herein stated to its present
value using the CPI as
published by the PSA. (s)
Animals, except race horses,
and plants for scientific,
experimental propagation or
breeding, and for other
botanical, zoological and
national defense purposes:
Provided, That no live trees,
shoots, plants, moss and
bulbs, tubers and seeds for
propagation purposes may
be imported under this
section, except by order of
the government or other duly
authorized institutions:
Provided, however, That the
free entry of animals for
breeding purposes shall be
restricted to animals of
recognized breed, duly
registered in the record or
registry established for that
breed, and certified as such
by the Bureau of Animal
Industry (BAI):

Provided, further, That the

certification of such record,
and pedigree of such animal
duly authenticated by the
proper custodian of such
record or registry, shall be
submitted to the District
Collector, together with the
affidavit of the owner or
importer that such animal is
the animal described in said
certificate of record and
pedigree: Provided, finally,
That the animals and plants
are certified by the NEDA as
necessary for economic
development;

(t) Economic, technical,

vocational, scientific,
philosophical, historical and
cultural books or publications,
and religious books like
Bibles, missals, prayer
books, the Koran, Ahadith
and other religious books of
similar nature and extracts
therefrom, hymnal and
hymns for religious uses:
Provided, That those which
may have already been
imported but are yet to be
released by the Bureau at the
effectivity of this Act may still
enjoy the privilege herein
provided upon certification by
the DepED that such
imported books and/or
publications are for
economic, technical,
vocational, scientific,
philosophical, historical or
cultural purposes or that the
same are educational,
scientific or cultural materials
covered by the International
Agreement on Importation of
Educational Scientific and
Cultural Materials (IAESCM)
signed by the President of
the Philippines on August
2,1952, or other agreements
binding upon the Philippines.
Educational, scientific and
cultural materials covered by
international agreements or
commitments binding upon
the Philippine government so
certified by the DepED.

(u) Philippine goods

previously exported from the
Philippines and returned
without having been
advanced in value or
improved in condition by any
process of manufacturing or
other means, and upon which
no drawback or bounty has
been allowed, including
instruments and implements,
tools of trade, machinery and
equipment, used abroad by
Filipino citizens in the pursuit
of their business, occupation
or profession; and foreign
goods previously imported
when returned after having
been exported and loaned for
use temporarily abroad solely
for exhibition, testing and
experimentation, for scientific
or educational purposes; and
foreign containers previously
imported which have been
used in packing exported
Philippine goods and
returned empty if imported by
or for the account of the
person or institution who
exported them from the
Philippines and not for sale,
barter or hire subject to
identification: Provided, That
Philippine goods falling under
this subsection upon which
drawback or bounty have
been, allowed shall, upon
reimportation thereof, be
subject to a duty under this
subsection equal to the
amount of such drawback or
bounty;

(v) Aircraft, equipment and

machinery, spare parts,
commissary and catering
supplies, aviation gas, fuel
and oil, whether crude or
refined except when directly
or indirectly used for
domestic operations, and
such other goods or supplies
imported by and for the use
of scheduled airlines
operating under
congressional franchise:
Provided, That such goods or
supplies are not locally
available in reasonable
quantity, qualify and price
and are necessary or
incidental to the proper
operation of the scheduled
airline importing the same;

(w) Machineries, equipment,

tools for production, plans to
convert mineral ores into
saleable form, spare parts,
supplies, materials,
accessories, explosives,
chemicals, and transportation
and communications facilities
imported by and for the use
of new mines and old mines
which resume operations,
when certified to as such by
the Secretary of the
Department of Environment
and Natural Resources
(DENR), upon the
recommendation of the
Director of Mines and
Geosciences Bureau, for a
period ending five (5) years
from the first date of actual
commercial production of
saleable mineral products:
Provided, That such goods
are not locally available in
reasonable quantity, quality
and price and are necessary
or incidental in the proper
operation of the mine; and
aircrafts imported by agro-
industrial companies to be
used by them in their
agriculture and industrial
operations or activities, spare
parts and accessories
thereof, when certified to as
such by the Secretary of the
Department of Agriculture
(DA) or the Secretary of the
Department of Trade and
Industry (DTI), as the case
may be;

(x) Spare parts of vessels or

aircraft of foreign registry
engaged in foreign trade
when brought into the
Philippines exclusively as
replacements or for the
emergency repair thereof,
upon proof satisfactory to the
District Collector that such
spare parts shall be utilized
to secure the safety,
seaworthiness or
airworthiness of the vessel or
aircraft, to enable it to
continue its voyage or flight;

(y) Goods exported from the

Philippines for repair,
processing or reconditioning
without having been
substantially advanced in
value, and subsequently
reimported in its original form
and in the same state:
Provided, That in case the
reimported goods advanced
in value, whether or not in
their original state, the value
added shall be subject to the
applicable duty rate of the
tariff heading of the
reimported goods; and
(z) Trailer chassis when
imported by shipping
companies for their exclusive
use in handling containerized
cargo, upon posting a
security in an amount equal
to one hundred percent
(100%) of the ascertained
duties, taxes and other
charges due thereon, to
cover a period of one (1) year
from the date of acceptance
of the entry, which period, for
meritorious reasons, may be
extended by the
Commissioner from year to
year, subject to the following
conditions:

(1) That they shall be

properly identified and
registered with the Land
Transportation Office (LTO);

(2) That they shall be subject

to customs supervision fee to
be fixed by the District
Collector and subject to the
approval of the
Commissioner;

(3) That they shall be

deposited in the customs
territory when not in use; and

(4) That upon the expiration

of the period prescribed
above, duties and taxes shall
be paid unless otherwise
reexported.
(aa) Any officer or employee
of the DFA, including any
attache, civil or military or
member of the staff assigned
to a Philippine diplomatic
mission abroad by the
Department or any similar
officer or employee of other
departments assigned to any
Philippine consular office
abroad, or any AFP military
personnel accorded
assimilated diplomatic rank or
on duty abroad who is
returning from a regular
assignment abroad, for
reassignment

to the home office, or who

dies, resigns, or is retired
from the service, after the
approval of this Act, shall be
exempt from the payment of
all duties and taxes on
personal and household
effects, including one (1)
motor car which must have
been ordered or purchased
prior to the receipt by the
mission or consulate of the
order of recall, and which
must be registered in the
name of the officer or
employee: Provided, That
this exemption shall apply
only to the value of the motor
car and to the aggregate
assessed value of the
personal and household
effects, the latter not to
exceed thirty percent (30%)
of the total amount received
by the officer or employee in
salary and allowances during
the latest assignment abroad,
but not to exceed four (4)
years: Provided, however,
That this exemption shall not
be availed of more than once
every four (4) years:
Provided, further, That the
officer or employee
concerned must have served
abroad for not less than two
(2) years.

The provisions of general and

special laws, to the contrary
notwithstanding, including
those granting franchises,
there shall be no exemption
whatsoever from the payment
of duties except as provided
for in this Act; those granted
to government agencies,
instrumentalities or
government-owned or -
controlled corporations
(GOCCs) with existing
contracts, commitments,
agreements, or obligations
with foreign countries
requiring such exemption;
those granted to international
institutions, associations or
organizations entitled to
exemption pursuant to
agreements or special laws;
and those that may be
granted by the President
upon prior recommendation
of the NEDA in the interest of
national economic
development.
CHAPTER 2

CUSTOMS WAREHOUSES

Sec. 801. Establishment and

Supervision of Customs
Bonded Warehouses. –
When the business of the
port requires such facilities,
the District Collector, subject
to the approval of the
Commissioner, shall
designate and establish
warehouses for use as public
and private bonded
warehouses, yards, or for
other special purposes. All
such warehouses and
premises shall be subject to
the supervision of the District
Collector who shall impose
such conditions as may be
deemed necessary for the
protection of the revenue,
and of the goods stored
therein. In the exercise of the
District Collector's
supervisory functions herein
and in the Bureau's
implementation of this
chapter, existing contracts of
private operators with
appropriate government
agency or regulator, such as,
but not limited to, the
Philippine Ports Authority
(PPA), Subic Bay
Metropolitan Authority
(SBMA) and Phividec
Industrial Authority (PIA) and
their respective authorities
and powers already granted
by law pertinent to such
contracts, shall not be
impaired or adversely
affected.

Goods manufactured in
whole or in part of imported
materials, and intended for
exportation, may be made
and manufactured in a
bonded manufacturing
warehouse subject to the
following conditions:

(1) The manufacturer shall

file sufficient security for the
faithful observance of all
laws, rules and regulations
applicable thereto; (2) The
application for the
establishment of bonded
warehouses must be made in
writing and filed with the
customs officer, describing
the premises, the location,
and capacity of the same,
and the purpose for which the
building is to be used,
pursuant to Section 804 of
this Act;

(3) From the receipt of the

application, the customs
officer shall examine the
premises, evaluate its
location, construction, and
means provided for the
safekeeping of the goods;

(4) The customs officer may

authorize the establishment
of the customs bonded
warehouse, and accept a
bond for its operation and
maintenance if the applicant
was compliant with the
prescribed requirements; and

(5) The operator of the

bonded warehouse shall pay
an annual supervision fee in
an amount to be fixed by the
Commissioner.

Sec. 802. Types of Customs

Bonded Warehouses
(CBWs). – Customs bonded
warehouses may be
classified as either
manufacturing or
nonmanufacturing.

Manufacturing customs
bonded warehouse may be of
the following types: (a)
miscellaneous customs
bonded warehouse; (b)
customs common bonded
warehouse; or (c) industry-
specific bonded warehouse.

Nonmanufacturing customs
bonded warehouse include:
(a) public bonded warehouse;
(b) private bonded
warehouse; or (c) other
customs facilities.

Sec. 803. Types of Customs

Facilities and Warehouses
(CFWs). — Customs facilities
and warehouses shall
include:
(a) Container yard;

(b) Container freight station;

(c) Seaport warehouses; and

(d) Airport warehouses.

Subject to consultation with

the NEDA and the DTI, and
based on prevailing
economic circumstances, the
Secretary of Finance may,
upon the recommendation of
the Commissioner, create or
dissolve certain types of
warehouses.

Sec. 804. Application for

Operation of a Customs
Warehouse. – Application for
the establishment of CBW
and CFW shall be filed with
the District Collector where
the CBW or CFW is located,
describing the premises,
location, capacity and
purpose thereof.

Upon receipt of such

application, the District
Collector shall examine the
premises of such proposed
warehouse, particularly its
location, construction and
storage facilities. The District
Collector, with the approval of
the Commissioner, may
authorize the establishment
of customs warehouses, and
accept the required security
for its operation and
maintenance. The operator of
such CBW and CFW shall
pay an annual supervision
fee, as determined by the
Commissioner.

Sec. 805. Responsibility of

Operators. – The operator of
a CBW or CFW shall comply
with the customs
requirements on
establishment, security,
suitability and management,
including stock-keeping and
accounting- of the goods, of
the CBW or CFW.

Upon lawful demand, the

operator of a CBW or CFW
shall allow authorized
representatives of the Bureau
access to the premises at a
reasonable time, and to all
documents, books and
records of accounts
pertaining to the operations
of the CBW or CFW.

In case of loss of the goods

stored in a CBW or CFW due
to operator's gross
negligence or willful
misconduct, the operator
shall be liable for the
payment of duties and taxes
due thereof. The government
assumes no legal
responsibility over the
safekeeping of goods stored
in any customs warehouse,
yard or premises.
Sec. 806. Customs Control
Over CBWs and CFWs. –
The Bureau shall, for
customs purposes, exercise
control over, direct and
manage CBWs and CFWs
pursuant to Section 303 of
this Act and likewise over the
goods thereat pursuant to
Section 301 of this Act:
Provided, That the Bureau
shall not be liable for any loss
or damage of the goods
stored for safekeeping in any
CBW, CFW, yard or
premises.

Sec. 807. Discontinuance of

CBW and CFW. – The use of
any CBW and CFW may be
discontinued by the District
Collector when conditions so
warrant, or upon receipt of a
written request from the
operator thereof: Provided,
That all the requirements of
the laws and regulations
have been complied with by
said operator. Where dutiable
goods are stored in such
premises, the same must be
removed at the risk and
expense of the operator:
Provided, however, That the
premises shall not be
relinquished, and its use shall
not be discontinued until after
a careful examination of the
account of the warehouse
shall have been made.
Discontinuance of the use of
any warehouse shall be
effective upon approval
thereof by the District
Collector who shall, within ten
(10) days, inform the
Commissioner of such action
in writing.

Notice of discontinuance
made by the operator shall
not result in the discharge
from any duties, taxes, fees
and other charges imposed
on dutiable goods in said
warehouse.

Sec. 808. Warehousing

Security on Goods Stored in
CBWs. – For goods declared
in the entry for warehousing
in CBWs, the District
Collector shall require the
importer to post a sufficient
security equivalent to the
computed duties, taxes and
other charges, conditioned
upon the withdrawal of the
goods within the period
prescribed by Section 811 of
this Act or the payment of
duties, taxes and other
charges and compliance with
all importation requirements.

Sec. 809. Withdrawal of

Goods from CBWs. – –
Imported goods shall be
withdrawn from the CBWs
when the necessary
withdrawal permit has been
filed, together with any
related document required by
any provision of this Act and
other regulations.

Goods entered under

sufficient security as provided
in Section 1507 of this Act
may be withdrawn at any
time for consumption, transit,
or exportation. The
withdrawal must be made by
the CBW operator or its duly
authorized representative.

Sec. 810. Release of Goods

from CFWs. – Imported
goods shall be released
when the goods declaration
is electronically lodged,
together with any related
document required by any
provision of this Act and other
regulations. All goods
entered into the CFWs shall
be subject to the filing of a
goods declaration within the
period specified under
Section 407 of this Act.

Sec. 811. Period of Storage

in CBWs. – Goods entered
for warehousing may remain
in a CBW for a maximum
period of one (1) year from
the time of its arrival thereat.
For perishable goods, the
storage period shall be three
(3) months from the date of
arrival, extendable for valid
reasons, and upon written
request, to another three (3)
months. Goods not
withdrawn after the expiration
of the prescribed period shall
be deemed as abandoned,
as provided under Section
1129 of this Act.

The Commissioner shall, in

consultation with the
Secretary of Trade and
Industry, establish a
reasonable storage period
limit beyond one (1) year for
bonded goods for
manufacturing and intended
for exp ort, the processing
into finished products of
which requires a longer
period based on industry
standard and practice,
subject to the approval of the
Secretary of Finance.

Sec. 812. Exemption from

Duty of Goods in CBWs. –
Goods duly entered for
warehousing in CBWs shall
be exempt from duty and tax
within the allowed period for
storage unless withdrawn for
consumption, exportation or
transit to a free zone or
another CBW, in which case,
such withdrawal will be
subject to the applicable rules
and regulations on the
liquidation of the
warehousing entry.

Sec. 813. Records to be Kept

by CBW Operators. – An
account shall be kept by the
Bureau of all goods delivered
to a CBW, and a report shall
be made by the CBW
operator containing a detailed
statement of all imported
goods entered and withdrawn
from the CBW. The Bureau
shall specify the format of the
report and may require
electronic submission.

All documents, books, and

records of accounts
concerning the operation of
any CBW shall, upon
demand, be made available
to the District Collector or the
representative of the District
Collector for examination or
audit. For record purposes,
all documents shall be kept
for three (3) years.

CHAPTER 3

FREE ZONES

Sec. 814. When Goods are

Admitted and Withdrawn. –
Imported goods shall be
admitted into a free zone
when the goods declaration,
together with required
documents as required by
existing laws and regulations,
are electronically lodged with
the Bureau and other
relevant government
authorities at the time of
admission.

Imported goods shall be

withdrawn from the free zone
for entry to the customs
territory when the goods
declaration is electronically
lodged, together with
required documents at the
time of the withdrawal from
the free zone.

Sec. 815. Exemption from

Duty and Tax of Goods in
Free Zones. – Unless
otherwise provided by law
and in accordance with the
respective laws, rules and
regulations of the free zone
authorities, goods admitted
into a free zone shall not be
subject to duty and tax.

Sec. 816. Movement of

Goods into and from Free
Zones. – The entry of goods
into a free zone, whether
directly or through the
customs territory, shall be
covered by the necessary
goods declaration for
admission or transit.
Withdrawal from the free
zone into the customs
territory shall be covered by
the necessary goods
declaration for consumption
or warehousing.

Transfer of goods from one

free zone into another free
zone shall likewise be
covered by the necessary
transit permit.

The implementing rules and

regulations on the transit of
goods admitted into, exported
from, withdrawn into the
customs territory, and moved
between free zones shall be
formulated and issued jointly
by the Bureau and the free
zone authorities.

Sec. 817. Coordination With

Free Zone Authority. – To
ensure compliance with
customs laws and
regulations, the Bureau shall
coordinate with the governing
authority of the free zone.

CHAPTER4

STORES

Sec. 818. Stores for

Consumption. – Stores for
consumption shall include:

(a) Goods intended for use

by the passengers and the
crew on board vessels,
aircrafts, or trains, whether or
not sold; and

(b) Goods necessary for the

operation and maintenance
of vessels, aircrafts, or trains
including fuel and lubricants
but excluding spare parts and
equipment which are either
on board upon arrival or are
taken on board during the
stay in the customs territory
of vessels, aircrafts, or trains
used, or intended to be used,
in international traffic for the
transport of persons for
remuneration or for the
industrial or commercial
transport of goods, whether
or not for remuneration.

Sec. 819. Stores to be Taken

Away. – For purposes of this
chapter, "stores to be taken
away" means goods for sale
to the passengers and the
crew of vessels, aircrafts, or
trains with a view to being
landed, which are either on
board upon arrival or are
taken on board during the
stay in the customs territory
of vessels, aircrafts, or trains
used, or intended to be used,
in international traffic for the
transport of persons for
remuneration or for the
industrial or commercial
transport of goods, whether
or not for remuneration.

Sec. 820. Exemption from

Duties and Taxes of Stores. –
Customs treatment of stores
should apply uniformly,
regardless of the country of
registration or ownership of
vessels, aircraft, or trains.
Stores which are carried in a
vessel, aircraft, or train
arriving in the customs
territory shall be exempted
from import duties and taxes
provided that they remain on
board. Stores for
consumption by the
passengers and the crew
imported as provisions on
international express vessels,
aircrafts, or trains shall be
exempted from import duties
and taxes: Provided, That:

(a) Such goods are

purchased only in the
countries crossed by the
international vessels and
aircrafts in question; and

(b) Any duties and taxes

chargeable on such goods in
the country where they were
purchased are paid.

Stores necessary for the

operation and maintenance
of vessels, aircrafts, or trains
which are on board these
means of transport shall be
exempted from import duties
and taxes: Provided, further,
That they remain on board
while these means of
transport are in the customs
territory. The Bureau shall
allow the issue of stores for
use on board during the stay
of a vessel

in the customs territory in

such quantities as the
customs authority deems
reasonable with due regard
to the number of the
passengers and the crew and
to the length of the stay of the
vessel in the customs
territory. The Bureau should
allow the issue of stores for
use on board by the crew
while the vessel is
undergoing repairs in a dock
or shipyard: Provided, finally,
That the duration of stay in a
dock or shipyard is
considered to be reasonable.

When an aircraft is to land at

one or more airports in the
customs territory, the Bureau
should allow the issuance of
stores for consumption on
board both during the stay of
the aircraft at such
intermediate airports and
during its flight between such
airports.

The Bureau shall require a

carrier to take appropriate
measures to prevent any
unauthorized use of the
stores including sealing of the
stores, when necessary. It
shall require the removal of
stores from the vessel,
aircraft, or trains for storage
elsewhere during its stay in
the customs territory only
when the Bureau considers it
necessary.

Vessels, aircrafts, or trains

which depart for an ultimate
foreign destination shall be
entitled to take on board,
exempted from duties and
taxes, the following:

(1) Stores in such quantities

as the Bureau deems
reasonable with due regard
to the number of the
passengers and the crew, to
the length of the voyage or
Sight, and to any quantity of
such stores already on board;
and

(2) Stores necessary for the

operation and maintenance
of a vessel, aircraft, or train,
in such quantities as are
deemed reasonable for
operation and maintenance
during the voyage or flight,
after due regard of the
quantity of such stores
already on board.

Replenishment of stores that

are exempted from duties
and taxes shall be allowed for
vessels, aircrafts, or trains
which have arrived in the
customs territory, and which
need to replenish their stores
for the journey to their final
destination in the customs
territory, subject to the same
conditions provided in this
Chapter. Sec. 821. Goods
Declaration for Stores. –
When a declaration
concerning stores on board
vessels arriving in the
customs territory is required
by the Bureau, the
information required shall be
kept to the minimum and as
may be necessary for
customs control.
The quantities of stores
which are supplied to vessels
during its stay in the customs
territory should be recorded
on the required goods
declaration concerning
stores.

The Bureau shall not require

the presentation of a
separate declaration of
remaining stores on board a
vessel, an aircraft or a train.
No separate declaration
concerning stores should be
required upon departure of
vessels from the customs
territory. When a declaration
is required concerning stores
taken on board the vessels or
aircrafts upon departure from
the customs territory, the
information required shall be
kept to the minimum as may
be necessary for customs
control.

When a vessel, aircraft, or

train arrives in the customs
territory, stores on board
shall:

(a) Be cleared for

consumption or placed under
another customs procedure,
subject to compliance with
the conditions and formalities
applicable in each case; or

(b) Subject to prior

authorization by the Bureau,
be transferred respectively to
another vessel, aircraft, or
train assigned to an
international route.

TITLE IX

DUTY DRAWBACK AND

REFUND

CHAPTER 1

DUTY DRAWBACK

Sec. 900. Basis of Duty

Drawback. – (A) On Fuel
Used for Propulsion of
Vessels. – On all fuel
imported into the Philippines
used for propulsion of
vessels engaged in trade with
foreign countries, or in the
coastwise trade, a refund or
tax credit shall be allowed not
exceeding ninety-nine
percent (99%) of the duty
imposed by law upon such
fuel, which shall be paid or
credited under such rules and
regulations as may be
prescribed by the
Commissioner with the
approval of the Secretary of
Finance.

(B) On Petroleum Oils and

Oils Obtained from
Bituminous Minerals, Crude,
Eventually Used for
Generation of Electric Power
and for the Manufacture of
City Gas. – On petroleum oils
and oils obtained from
bituminous materials, crude
oil imported by nonelectric
utilities, sold directly or
indirectly, in the same form or
after processing, to electric
utilities for the generation of
electric power and for the
manufacture of city gas, a
refund or tax credit shall be
allowed not exceeding fifty
percent (50%) of the duty
imposed by law upon such
oils, which shall be paid or
credited under such rules and
regulations as may be
prescribed by the
Commissioner with the
approval of the Secretary of
Finance.

(C) On Goods Made from

Imported Materials. – Upon
exportation of goods
manufactured or produced in
the Philippines, including the
packing, covering, putting up,
marking or labeling thereof
either in whole or in part of
the imported materials for
which duties have been paid,
a refund or tax credit shall be
allowed for the duties paid on
the imported materials so
used including the packing,
covering, putting up, marking
or labeling thereof, subject to
the following conditions:

(1) The actual use of the

imported materials in the
production or manufacture of
the goods exported with their
quantity, value, and amount
of duties paid thereon, should
be established satisfactorily;

(2) The duties refunded or

credited shall not exceed one
hundred percent (100%) of
duties paid on the imported
materials used;

(3) There is no determination

by the NEDA of the
requirement for certification
on nonavailability of locally-
produced or manufactured
competitive substitutes for
the imported materials used
at the time of importation;

(4) The exportation shall be

made within one (1) year
after the importation of
materials used and claim of
refund or tax credit shall be
filed within six (6) months
from the date of exportation;
and

(5) When two or more

products result from the use
of the same imported
materials, an apportionment
shall be made on its
equitable basis.

Sec. 901. Payment of

Drawbacks. – Eligible claims
for refund or tax credit shall
be paid or granted by the
Bureau to claimants within
sixty (60) days after receipt of
properly accomplished
claims: Provided, That a
registered enterprise under
Republic Act No. 5186,
otherwise known as the
"Investment Incentives Act",
or Republic Act No. 6135,
otherwise known as the
"Export Incentives Act of
1970", which has previously
enjoyed tax credits based on
customs duties paid on
imported raw materials and
supplies, shall not be entitled
to a drawback under this
section with respect to the
same importation
subsequently processed and
reexported.

The Secretary of Finance

may, upon the
recommendation of the
Commissioner, promulgate
rules and regulations allowing
partial payments of
drawbacks pursuant to this
section,

Sec. 902. Prescription of

Drawback Claim. – A claim
and application for a
drawback shall prescribe if it
is not filed within one (1) year
from the date of importation
in case of Section 900,
paragraphs (A) and (B) and
within one (1) year from the
date of exportation in the
case of Section 900,
paragraph (C), subject to
such rules and regulations as
may be issued by the
Commissioner, upon
approval of the Secretary of
Finance.

CHAPTER 2

REFUND AND ABATEMENT

Sec. 903. Refund of Duties

and Taxes. – Refund shall be
granted where it is
established that duties and
taxes have been overcharged
as a result of an error in the
assessment or goods
declaration.

Where permission is given by

the Bureau for goods
originally declared for a
customs procedure with
payment of duties and taxes
to be placed under another
customs procedure, a refund
shall be made of any duties
and taxes charged in excess
of the amount due under the
new procedure, subject to
such regulation issued for the
purpose.

A refund shall not be granted

if the amount of duties and
taxes involved is less than
five thousand pesos
(P5,000.00): Provided, That
the Secretary of Finance, in
consultation with the
Commissioner, may adjust
the minimum amount
specified in this Act, taking
into account the CPI as
published by the PSA.

Sec. 904. Abatement of

Duties and Taxes. – When
goods have not yet been
released for consumption or
have been placed under
another customs procedure,
provided that no other
offense or violation has been
committed, the declarant
shall neither be required to
pay the duties and taxes nor
be entitled to refund thereof
in any of the following cases:

(a) When, at the request of

the declarant, the goods are
abandoned, or as determined
by the Bureau, the goods are
destroyed or rendered
commercially valueless while
under customs control. Any
cost herein incurred shall be
borne by the declarant;

(b) When goods are

destroyed or irrecoverably
lost by accident or force
majeure, the remaining waste
or scrap after destruction, if
taken into consumption, shall
be subject to the duties and
taxes that would be
applicable on such waste or
scrap if imported in same
state; and

(c) When there are shortages

due to the nature of the
goods.
Sec. 905. Abatement for
Damage Incurred During
Voyage. – Except as
otherwise provided, no
abatement of duties shall be
made on account of damage
incurred or deterioration
suffered during the voyage of
importation; and duties will be
assessed on the actual
quantity imported as
determined by the customs
officers concerned.

Sec. 906. Abatement or

Refund of Duty on Missing
Package. – When any
package appearing on the
manifest or bill of lading or
airway bill is missing, an
abatement or refund of the
duty shall he made if it is
certified by the importer or
consignee, under pain of
penalty for falsification or
perjury, and upon production
of proof satisfactory to the
Collector concerned, that the
package in question has not
been unlawfully imported into
the Philippines.

Sec. 907. Abatement or

Refund for Deficiency in
Contents of Packages. – If,
upon opening of any
package, a deficiency in the
quantity of the goods is found
to exist based upon the
invoice, such deficiency shall
be certified, under pain of
penalty for falsification or
perjury, by the customs
officers concerned and upon
the production of proof
showing that the shortage
occurred before the arrival of
the goods in the Philippines.
Upon sufficient proof thereof,
the proper abatement or
refund of the duty shall be
made.

Sec. 908. Abatement or

Refund of Duties on Goods
Lost or Destroyed After
Arrival. – The Bureau may
abate or refund the amount of
duties accruing or paid on
any goods that have been
lost due to injury, theft,
destruction through fire or
through any other causes,
upon satisfactory proof of the
same, under any of the
following circumstances:

(a) While 'within the territory

of any port of entry, prior to
unloading' under the
Bureau's supervision;

(b) While remaining in

customs custody after
unloading;

(c) While in transit from the

port of entry to any port in the
Philippines; and

(d) While released under

sufficient security for export
except in case of loss by
theft.

Sec. 909. Abatement and

Refund of Defective Goods. –
Under conditions to be set by
the Commissioner, and with
the approval of the Secretary
of Finance, an abatement
and refund shall be granted
on imported or exported
goods which are found
defective or otherwise not in
accordance with, the agreed
specifications at the time of
importation or exportation
and are returned either to the
supplier or to another person
designated by the supplier,
subject to the following
conditions:

(a) The goods have not been

worked, repaired, or used in
the country of importation,
and are reexported within, a
reasonable time; and

(b) The goods have not been

worked, repaired, or used in
the country to which, they
were exported, and are
reimported within a
reasonable time.

Use of the goods shall,

however, not hinder the
refund if such use was
indispensable to discover the
defects or other
circumstances which caused
the reexportation or
reimportation of the goods.

As an alternative to
reexportation or
reimportation, the goods may
be expressly abandoned or
destroyed or rendered
commercially valueless under
customs control as the
Bureau may decide. In such,
case, the importer shall not
be entitled to an abatement
or a refund if it does not
defray the costs of such
abandonment, destruction, or
rendition.

Sec. 910. Abatement of Duty

on Dead or Injured Animals.
– Where it is certified, under
pain of penalty for falsification
or perjury, and upon
production of proof
satisfactory to the Bureau
that an animal subject of
importation dies or suffers
injury before arrival, or while
in customs custody, the duty
due thereon shall be abated
provided that its carcass on
board or in customs custody
is removed in the manner
required by the Bureau and
at the expense of the
importer.

Sec. 911. Investigation

Required in Case of
Abatements and Refunds. –
The Customs Officer
concerned shall, in all cases
of abatement or refund of
duties, submit an
examination report as to any
fact discovered which
indicates any discrepancy
and cause the corresponding
adjustment on the goods
declaration.

Sec. 912. Refund Arising

from Correction of Errors. –
Manifest clerical errors made
on an invoice or entry, errors
in return of weight, measure
and gauge, when duly
certified under penalties of
falsification or perjury by the
surveyor or examining officer
when there are such officers
at the port, and errors in the
distribution of charges on
invoices not involving any
question of law and certified
under penalties of falsification
or perjury by the examining
customs officer, may be
corrected in the computation
of duties, if such errors are
discovered before the
payments of duties, or if
discovered within one (1)
year after release from
customs custody of imported
goods upon written request
and notice of error from the
importer, or upon statement
of error certified by the
District Collector.

For the purpose of correcting

errors specified in the next
preceding paragraph, the
Bureau is authorized to make
refunds within the statutory
time limit.

Sec. 913. Claims for Refund.

– All claims and application
for refund of duties and taxes
shall be made in writing and
filed with the Bureau within
twelve (12) months from the
date of payment of duties and
taxes.

If, as a result of the refund of

duties, a corresponding
refund of internal revenue
taxes on the same
importation becomes due, the
Bureau shall cause the
refund of internal revenue
taxes in favor of the importer
after issuance of a
certification from the
Commissioner of Internal
Revenue, when applicable.

The importer may file an

appeal of a denial of a claim
for refund or abatement,
whether it is a full or partial
denial, with the
Commissioner within thirty
(30) days from the date of the
receipt of the denial. The
Commissioner shall render a
decision within thirty (30)
days from the receipt of all
the necessary documents
supporting the application.
Within thirty (30) days from
receipt of the decision of the
Commissioner, the case may
also be appealed to the CTA.

Notwithstanding the
provisions in the preceding
paragraphs, the filing of
claims for refund of national
internal revenue taxes shall
be governed by the
provisions provided under the
NIRC of 1997, as amended.

TITLE X

POST CLEARANCE AUDIT

Sec. 1000. Audit and

Examination of Records. –
Within three (3) years from
the date of final payment of
duties and taxes or customs
clearance, as the case may
be, the Bureau may conduct
an audit examination,
inspection, verification, and
investigation of records
pertaining to any goods
declaration, which shall
include statements,
declarations, documents, and
electronically generated or
machine readable data, for
the purpose of ascertaining
the correctness of the goods
declaration and determining
the liability of the importer for
duties, taxes and other
charges, including any fine or
penalty, to ensure
compliance with this Act.
Sec. 1001. Scope of the
Audit. – The audit of
importers shall be conducted
when firms are selected by a
computer-aided risk
management system, the
parameters of which are to
be based on objective and
quantifiable data, subject to
the approval of the Secretary
of Finance upon
recommendation of the
Commissioner. The criteria
for selecting firms to be
audited shall include:

(a) Relative magnitude of

customs revenue to be
generated from the firm; (b)
The rates of duties of the
firm's imports;

(c) The compliance track

records of the firm; and

(d) An assessment of the risk

to revenue of the firm's
import activities.

Sec. 1002. Access to

Records. – Any authorized
officer of the Bureau shall be
given by the importer and
customs broker full and free
access to the premises
where the records are kept,
to conduct audit examination,
inspection, verification, and
investigation of those records
relevant to such investigation
or inquiry.
A copy of any document
certified by or on behalf of the
importer is admissible in
evidence in all courts as if it
were the original copy.

A customs officer is not

entitled to enter the premises
under this section unless,
before so doing, the officer
produces to the person
occupying or apparently in
charge of the premises
written evidence of the fact of
being duly authorized. The
person occupying or
apparently in charge of the
premises entered by an
officer shall provide the
officer with all reasonable
facilities and assistance for
the effective exercise of the
officer's authority under this
section.

Unless otherwise provided

herein or in other provisions
of law, the Bureau may, in
case of disobedience, invoke
the aid of the proper regional
trial court within whose
jurisdiction the matter falls.
The court may punish
contumacy or refusal as
contempt. In addition, the fact
that the importer or customs
broker denies the authorized
customs officer full and free
access to importation records
during the conduct of a post
clearance audit shall create a
presumption of inaccuracy in
the transaction value
declared for their imported
goods and constitute grounds
for the Bureau to conduct a
reassessment of such goods.

In addition, the imposition of

the appropriate criminal
sanctions provided under this
Act and other administrative
sanctions may be
concurrently invoked against
contumacious importers,
including the suspension of
the delivery or release of their
imported goods.

Sec. 1003. Requirement to

Keep Records. – (a) All
importers are required to
keep at their principal place
of business, in the manner
prescribed by regulations to
be issued by the
Commissioner and for a
period of three (3) years from
the date of final payment of
duties and taxes or customs
clearance, as the case may
be, all records pertaining to
the ordinary course of
business and to any activity
or information contained in
the records required by this
title in connection with any
such activity.

For purposes of the post

clearance audit and Section
1005 of this Act, the term
importer shall include the
following:
(1) Importer-of-record or
consignee, owner or
declarant, or a party who:

(i) Imports goods into the

Philippines or withdraws such
goods into the Philippine
customs territory for
consumption or warehousing;
files a claim for refund or
drawback; or transports or
stores such goods carried or
held under security; or

(ii) Knowingly causes the

importation or transportation
or storage of imported goods
referred to above, or the filing
of refund or drawback claim.

(2) An agent of any party

described in paragraph (1); or

(3) A person whose activities

require the filing of a goods
declaration.

A person ordering imported

goods from a local importer
or supplier in a domestic
transaction shall be
exempted from the
requirements imposed by this
section unless:

(1) The terms and conditions

of the importation are
controlled by the person
placing the order; or
(2) The circumstances and
nature of the relationship
between the person placing
the order and the importer or
supplier are such that the
former may be considered as
the beneficial or true owner of
the imported goods; or

(3) The person placing the

order had prior knowledge
that they will be used in the
manufacture or production of
the imported goods.

(b) All parties engaged in

customs clearance and
processing are required to
keep at their principal place
of business, in the manner
prescribed by regulations to
be issued by the
Commissioner and for a
period of three (3) years from
the date of filing of the goods
declaration, copies of the
abovementioned records
covering the transactions
handled.

(c) Locators or persons

authorized to bring imported
goods into free zones, such
as the special economic
zones and free ports, are
required to keep subject-
records of all its activities,
including in whole or in part,
records on imported goods
withdrawn from said zones
into the customs territory for
a period of three (3) years
from the date of filing of the
goods declaration.

Failure to keep the records

required by this Act shall
constitute a waiver of this
right to contest the results of
the audit based on records
kept by the Bureau.

Sec. 1004. Power of the

Commissioner to Obtain
Information and Issue
Summons. – For the effective
implementation of the post
clearance audit functions of
the Bureau, the
Commissioner is hereby
authorized to:

(a) Obtain on a regular basis

from any person, in addition
to the person who is the
subject of a post clearance
audit or investigation, or from
any office or officer of the
national and local
governments, government
agencies and
instrumentalities, including
the BSP and GOCCs, any
information such as costs
and "volume of production,
receipts or sales and gross
income of taxpayers, and the
names, addresses, and
financial statements of
corporations, regional
operating headquarters of
multinational companies, joint
accounts, associations, joint
ventures or consortia and
registered partnerships, and
their members, whose
business operations or
activities are directly or
indirectly involved in the
importation or exportation of
imported goods or products
manufactured from imported
component materials;

(b) Summon the person liable

for duties and taxes or
required to file goods
declaration, or any officer or
employee of such person, or
any person having
possession, custody, or care
of the books of accounts and
other accounting records
containing entries relating to
the business of the person
liable for duties and taxes, or
any other person, to appear
before the Commissioner or
the duly authorized
representative at a time and
place specified in the
summons and to produce
such books, papers, records,
or other data, and to give
testimony;

(c) Take such, testimony of

the person concerned, under
oath, as may be relevant or
material to such inquiry; or

(d) Obtain information from

banks or other financial
institutions on commercial
documents and records
pertaining specifically to
payments relevant to import
transaction.

The provisions of the

foregoing paragraphs
notwithstanding, nothing in
this section shall be
construed as granting the
Commissioner the authority
to inquire into bank deposits
of persons or entities
mentioned in this Title.

Sec. 1005. Failure to Pay

Correct Duties and Taxes on
Imported Goods. – Any
person who, after being
subjected to post clearance
audit and examination as
provided in Section 1000 of
this Act, is found to have
incurred deficiencies in.
duties and taxes paid for
imported goods, shall be
penalized according to two
(2) degrees of culpability
subject to any mitigating,
aggravating, or extraordinary
factors that are clearly
established by available
evidence as described
hereunder:

(a) Negligence. – When a

deficiency results from an
offender's failure, through an
act or acts of omission or
commission, to exercise
reasonable care and
competence in ensuring that
a statement made is correct,
the offender shall be charged
for committing negligence,
and, if found guilty shall be
penalized with a fine
equivalent to one hundred
twenty-five percent (125%) of
the revenue loss: Provided,
That subject to Section 108
of this Act, no substantial
penalty shall be imposed on
an inadvertent error
amounting to simple
negligence, as defined by
rules promulgated by the
Secretary of Finance, upon
recommendation of the
Commissioner;

(b) Fraud. – When the

material false statement or
act in connection with the
transaction was committed or
omitted knowingly, voluntarily
and intentionally, as
established by clear and
convincing evidence, the
offender who is charged for
committing fraud and is found
guilty thereof, shall be
penalized with a fine
equivalent to six (6) times of
the revenue loss and/or
imprisonment of not less than
two (2) years, but not more
than eight (8) years.

The decision of the

Commissioner, upon proper
hearing, to impose penalties
as prescribed in this section
may be appealed in
accordance with Section
1104 of this Act.
Sec. 1006. Records to be
Kept by the Bureau. – The
Bureau shall keep a
database of importer and
broker profiles which shall
include a record of audit
results and the following
information and papers:

(a) Articles of Incorporation;

(b) The company structure,

which shall include, but not
limited to, incorporators and
board of directors key
officers, and organizational
structure;

(c) Key importations;

(d) Privileges enjoyed;

(e) Penalties; and (1) Risk

categories.

The Bureau shall furnish the

BIR and the DOF a copy of
the final audit results within
thirty (30) days from the
issuance thereof.

TITLE XI

ADMINISTRATIVE AND
JUDICIAL PROCEDURES

CHAPTER 1

ADVANCE RULING AND

DISPUTE SETTLEMENT
Sec. 1100. Classification
Ruling. – An importer or
exporter may file a written
application for an advance
ruling on the tariff
classification of goods with
the Commission. The
Commission shall render a
ruling within thirty (30) days
from, receipt of a properly
documented application.

When a declared tariff

classification of goods, not
subject of a pending
application for advance
ruling, is in dispute, the
importer, exporter, or the
Bureau shall submit the
matter to the Commission for
a ruling, without prejudice to
the application of Section
1106 of this Act on "protest":
Provided, That such rulings
of the Commission on
commodity classification shall
be binding upon the Bureau,
unless the Secretary of
Finance shall rule otherwise.

Sec. 1101. Valuation Ruling.

– An importer or exporter
may file a written application
for an advance valuation
ruling on the proper
application of a specific
method on customs valuation
of specific goods as
prescribed in Title VII,
Chapter 1 of this Act.
The application for a
valuation ruling shall be filed
with the Commissioner who
shall issue a ruling within
thirty (30) days from
submission of the application
form and supporting
documents as may be
required by rules and
regulations.

When the valuation method

of goods not subject of an
application for advance
valuation ruling or the
declared customs value is in
dispute, the matter shall be
resolved in accordance with
Section 1106 of this Act on
"protest".

Sec. 1102. Ruling on the

Rules of Origin. – An importer
or exporter may file a written
application for a ruling on
whether the goods qualify as
originating under the rules of
origin of the applicable
preferential trade agreement.
The application for an
advance ruling on origin shall
be filed with the
Commissioner who shall act
on the application within thirty
(30) days from receipt of the
application and supporting
documents as may be
required by rules and
regulations.

When the declared origin of

the goods, not subject of a
request for advance ruling on
origin, is in dispute, the
matter shall be resolved in
accordance with Section
1106 of this Act on "protest".

Sec. 1103. Conditions for

Application and Effect of
Advance Ruling. – An
application for an advance
ruling shall cover only one (1)
product or item. The
application for advance ruling
shall be filed at least ninety
(90) days before the
importation or exportation of
the product or item, as the
case may be.

Sec. 1104. Administrative

and Judicial Appeals. – An
aggrieved party may, within
thirty (30) days from receipt
of an adverse ruling or
decision, appeal the same to
the CTA without prejudice to
the authority of the Secretary
of Finance to review
decisions adverse to the
government in accordance
with Sections 1127 and 1128
of this Act, as the case may
be.

SEC, 1105. Implementing

Rules and Regulations. – The
Secretary of Finance, upon
the recommendation of the
Bureau and the Commission,
shall promulgate rules and
regulations to implement the
preceding provisions on
advance ruling.

CHAPTER 2

PROTEST

Sec. 1106. Protest – When a

ruling or decision of the
District Collector or customs
officer involving goods with
valuation, rules of origin, and
other customs issues is
made, except the fixing of
fines in seizure cases, the
party adversely affected may
appeal by way of protest
against such ruling or
decision by presenting to the
Commissioner at the time
when payment of the amount
claimed to be due the
government is made, or
within fifteen (15) days
thereafter, a written protest
setting forth the objection to
the ruling or decision in
question and the reasons
therefore.

Subject to the approval of the

Secretary of Finance, the
Commissioner shall provide
such rules and regulations as
to the requirement for
payment or nonpayment of
the disputed amount and in
case of nonpayment, the
release of the importation
under protest upon posting of
sufficient security.
Sec. 1107. Protest Exclusive
Remedy in Protestable Case.
– In all cases subject to
protest, the interested party
who desires to have the
action of the District Collector
reviewed, shall file a protest
as provided in Section 1106
of this Act, otherwise the
action of the District Collector
shall be final and conclusive.

Sec. 1108. Form and Scope

of Protest. – A protest shall
be filed in accordance with
the prescribed rules and
regulations promulgated
under this section. It shall
specify the particular decision
or ruling of the District
Collector for which protest is
being made, and shall
indicate the particular ground
or grounds upon which the
protesting party bases the
claim for relief. The scope of
a protest shall be limited to
the particular goods subject
of a goods declaration, but
any number of issues may be
raised in a protest with
reference to the goods
declaration constituting the
subject matter of the protest.

Sec. 1109. Samples to be

Furnished by Protesting
Parties. – If the nature of the
goods permit, importers filing
protests involving questions
of fact must, upon demand,
present to the Commissioner
samples of the goods which
are the subject matter of the
protest. The samples of the
goods shall be verified by the
customs officer who made
the classification, against
which the protests are filed.

Sec. 1110. Decision in

Protest. – When a protest is
filed in proper form, the
Commissioner shall render a
decision within thirty (30)
days from receipt of the
protest. In case the protest is
sustained, in whole or in part,
the appropriate order shall be
made, and the entry
reassessed, if necessary.

CHAPTER 3

ALERT ORDERS

Sec. 1111. Alert Orders. –

Alert orders are written
orders issued by customs
officers as authorized by the
Commissioner on the basis of
derogatory information
regarding possible
noncompliance with this Act.
An alert order will result in the
suspension of the processing
of the goods declaration and
the conduct of physical or
nonintrusive inspection of the
goods within forty-eight (48)
hours from issuance of the
order. Within forty-eight (48)
hours or, in the case of
perishable goods, within
twenty-four (24) hours from
inspection, the alerting officer
shall recommend the
continuance of processing of
goods in ease of a negative
finding, or issuance of a
warrant of seizure and
detention if a discrepancy
between the declaration and
actual goods is found. The
Bureau's information system
shall immediately reflect the
imposition or lifting of an alert
order.

Derogatory information shall

indicate the violations and
other necessary specifics
thereof. For this purpose, the
following shall not be
considered derogatory
information:

(a) General allegations of

undervaluation;

(b) General allegations of

misclassification without
providing the appropriate
tariff heading and duty of the
shipment to be alerted;

(c) General allegations of

over-quantity without
indicating the source of
information supporting the
allegation;

(d) General allegations of

misdeclaration in the entry
without indicating the
suspected actual contents
thereof; and

(e) General allegations of

importations contrary to law
without indicating the specific
law or rule to be violated.

No alert order shall be issued

on account of allegations of
undervaluation unless said
undervaluation is caused by
the submission to customs of
forged or spurious invoice or
other commercial documents.

An alert order may be issued

only after lodgement of the
goods declaration and prior
to the release of goods from
customs custody. Under no
circumstances shall, the
suspension of the processing
of goods declaration be
allowed except through an
alert order issued by an
authorized customs officer.

The costs of the physical

inspection shall be borne by
the Bureau: Provided, That
such cost shall be
reimbursed by the owner
prior to the release of the
goods if the physical
inspection results in the
assessment of additional
duties or taxes or the
issuance of a warrant of
seizure.
The Commissioner shall be
notified of the
recommendation by the
alerting officer within twenty-
four (24) hours from the
issuance of the alert order.
Alert orders shall be dated
and assigned a unique
reference number in series
which shall be the basis for
reporting to and monitoring
by the Commissioner and the
Secretary of Finance.

The Bureau shall create a

central clearing house for
alert orders and shall submit
reports quarterly on the
status thereof.

Sec. 1112. Alert Orders on

Perishable Goods. – When
the subject of the alert order
are perishable goods, the
Bureau shall attach to the
recommendation a certificate
stating that the goods are
perishable.

CHAPTER 4

SEIZURE AND
FORFEITURE

Sec. 1113. Property Subject

to Seizure and Forfeiture. –
Property that shall be subject
to seizure and forfeiture
include:

(a) Any vehicle, vessel or

aircraft, including cargo,
which shall be used
unlawfully in the importation
or exportation of goods or in
conveying or transporting
smuggled goods in
commercial quantities into or
from any Philippine port or
place. The mere carrying or
holding on board of smuggled
goods in commercial
quantities shall subject such
vehicle, vessel, aircraft, or
any other craft to forfeiture:
Provided, That the vehicle,
vessel, aircraft or any other
craft is not used as a
common carrier which has
been chartered or leased for
purposes of conveying or
transporting persons or
cargo;

(b) Any vessel engaging in

the coastwise trade which
shall have on board goods of
foreign growth, produce, or
manufacture in excess of the
amount necessary for sea
stores, without such goods
having been properly entered
or legally imported;

(c) Any vessel or aircraft into

which shall be transferred
cargo unloaded contrary to
law prior to the arrival of the
importing vessel or aircraft at
the port of destination;

(d) Any part of the cargo,

stores, or supplies of a vessel
or aircraft arriving from a
foreign port which is
unloaded before arrival at the
vessel's or aircraft's port of
destination and without
authority from the customs
officer; but such cargo, ship,
or aircraft stores and supplies
shall not be forfeited if such
unloading was due to
accident, stress of weather,
or other necessity and is
subsequently approved by
the District Collector;

(e) Goods which are

fraudulently concealed in or
removed contrary to law from
any public or private
warehouse, container yard,
or container freight station
under customs supervision;

(f) Goods, the importation or

exportation of which are
effected or attempted
contrary to law, or any goods
of prohibited importation or
exportation, and all other
goods which, in the opinion of
the District Collector, have
been used, are or were
entered to be used as
instruments in the importation
or the exportation of the
former;

(g) Unmanifested goods

found on any vessel or
aircraft if manifest therefor is
required;
(h) Sea stores or aircraft
stores adjudged by the
District Collector to be
excessive, when the duties
and taxes assessed by the
District Collector thereon are
not paid or secured forthwith
upon assessment of the
same;

(i) Any package of imported

goods which is found upon
examination to contain goods
not specified in the invoice or
goods declaration including
all other packages
purportedly containing
imported goods similar to
those declared in the invoice
or goods declaration to be
the contents of the
misdeclared package;

(j) Boxes, cases, trunks,

envelopes, and other
containers of whatever
character used as receptacle
or as device to conceal
goods which are subject to
forfeiture under this Act or
which are so designed as to
conceal the character of such
goods;

(k) Any conveyance actually

used for the transport of
goods subject to forfeiture
under this Act, with its
equipage or trappings, and
any vehicle similarly used,
together with its equipment
and appurtenances. The
mere conveyance of
smuggled goods by such
transport vehicle shall be
sufficient cause for the
outright seizure and
confiscation of such transport
vehicle but the forfeiture shall
not be effected if it is
established that the owner of
the means of conveyance
used as aforesaid, is
engaged as common carrier
and not chartered or leased,
or that the agent in charge
thereof at the time, has no
knowledge of the unlawful
act; and

(1) Goods sought to be

imported or exported:

(1) Without going through a

customs office, whether the
act was consummated,
frustrated, or attempted;

(2) Found in the baggage of a

person arriving from abroad
and undeclared by such
person;

(3) Through a false

declaration or affidavit
executed by the owner,
importer, exporter, or
consignee concerning the
importation of such, goods;

(4) On the strength of a false

invoice or other document
executed by the owner,
importer, exporter, or
consignee concerning the
importation or exportation of
such goods; or

(5) Through any other

practice or device contrary to
law by means of which such
goods entered through a
customs office to the
prejudice of the government.

Sec. 1114. Properties not

Subject to Forfeiture in, the
Absence of Prima Facie
Evidence. – The forfeiture of
the vehicle, vessel, or aircraft
shall not be effected if it is
established that the owner
thereof or the agent in charge
of the means of conveyance
used as aforesaid has no
knowledge of or participation
in the unlawful act: Provided,
That a prima facie
presumption shall exist
against the vehicle, vessel, or
aircraft under any of the
following circumstances:

(a) If the conveyance has

been used for smuggling
before;

(b) If the owner is not in the

business for which the
conveyance is generally
used; and

(c) If the owner is not

financially in a position to
own such conveyance.
Sec. 1115. Conditions
Affecting Forfeiture of Goods.
– The forfeiture shall be
effected only when and while
the goods are in the custody
or within the jurisdiction of
customs officers, or in the
possession or custody of or
subject to the control of the
importer, exporter, original
owner, consignee, agent of
another person effecting the
importation, entry or
exportation in question, or in
the possession or custody of
or subject to the control of
persons who shall receive,
conceal, buy, sell, or
transport the same, or aid in
any of such acts, with
knowledge that the goods
were imported, or were the
subject of an attempt at
importation or exportation
contrary to law.

Sec. 1116. Seizure or

Release of Goods. – The
District Collector shall issue
an order of release or a
warrant of seizure within five
(5) days, or two (2) days in
case of perishable goods,
upon the recommendation of
the alerting officer or any
other customs officer. The
District Collector shall
immediately make a report of
such seizure or release to the
Commissioner.
SBC. 1117. Warrant of
Seizure or Order of Release.
– The District Collector shall
have the authority to issue a
warrant of seizure of the
goods upon determination of
the existence of probable
cause and in case of
nonexistence thereof, the
issuance of order of release.
In case the District Collector
issued an order of release,
the District Collector shall
immediately transmit all the
records to the Commissioner
who shall automatically
review within forty-eight (48)
hours, or within twenty-four
(24) hours in case of
perishable goods. When no
decision is made by the
Commissioner within the
prescribed period, the
imported goods shall be
deemed released.

The lifting of the alert order

shall be issued by the District
Collector only upon the
affirmation of the decision of
the District Collector by the
Commissioner, or after the
lapse of the period of review
by the Commissioner,
whichever is earlier.

Sec. 1118. Sale of Perishable

Goods During Forfeiture
Proceedings. – Upon motion
of the importer of the
perishable goods, the goods
may be sold at a public
auction during the pendency
of the forfeiture proceedings.
The proceeds of the auction
shall be held in escrow until
the final resolution of the
proceedings.

Sec. 1119. Service of

Warrant of Seizure. – The
District Collector shall cause
the service of warrant of
seizure to the owner or
importer of the goods or the
authorized representative
thereof. The owner or
importer shall be given an
opportunity to be heard
during the forfeiture
proceedings.

For the purpose of serving

the warrant, the importer,
consignee, or person holding
the bill of lading or airway bill
shall be deemed the "owner"
of the goods. For the same
purpose, "authorized
representative" shall include
any agent of the owner and if
the owner or the agent is
unknown, any person having
possession of the goods at
the time of the seizure.

Service of warrant to an.

unknown owner shall be
effected by posting the
warrant for fifteen (15) days
in a public place at the
concerned district, and by
electronic or printed
publication.
Sec. 1120. Description,
Classification and Valuation
of Seized Goods. – The
District Collector shall cause
the preparation of a list and
particular description,
classification, and valuation
of the goods seized and
valuation of identical or
similar goods.

Sec. 1121. Proceedings in

Case of Property Belonging
to Unknown Parties. – If,
within fifteen (15) days after
service of warrant, no owner
or agent can be found or
appears before the District
Collector, the seized goods
shall be forfeited ipso facto in
favor of the government to be
disposed of in accordance
with this Act.

Sec. 1122. Seizure of Vessel

or Aircraft for Delinquency of
Owner or Officer. – When the
owner, agent, master, pilot in
command or other
responsible officer of any
vessel or aircraft becomes
liable for any violation of this
Act, the vessel or aircraft may
be seized and be subjected
to forfeiture proceedings for
the settlement of any fine or
penalty for which such
person is liable. In
determining whether or not to
seize a vessel or aircraft, the
Bureau shall take into
account the amount of fine or
penalty in relation to the
commercial impact that may
be caused to international
trade by the seizure or
detention as well as the value
of the vessel or aircraft.

Sec. 1123. Burden of Proof in

Forfeiture Proceedings. – In
all proceedings for the
forfeiture of any vehicle,
vessel, aircraft, or goods
under this Act, the burden of
proof shall be borne by the
claimant.

Sec. 1124. Settlement of

Pending Seizure Case by
Payment of Fine or
Redemption of Forfeited
Goods. – Subject to the
approval of the
Commissioner, the District
Collector may allow the
settlement by payment of fine
or the redemption of forfeited
goods, during the course of
the forfeiture proceeding.
However, the Commissioner
may accept the settlement by
redemption of any forfeiture
case on appeal. No
settlement by payment of fine
shall be allowed when there
is fraud or when the
discrepancy in duties and
taxes to be paid between
what is determined and what
is declared amounts to more
than thirty percent (30%).
In case of settlement by
payment of fine, the owner,
importer, exporter, or
consignee or agent shall offer
to pay a fine equivalent to
thirty percent (30%) of the
landed cost of the seized
goods. In case of settlement
by redemption, the owner,
importer, exporter, or
consignee or agent shall offer
to pay the redeemed value
equivalent to one hundred
percent (100%) of the landed
cost.

Upon payment of the fine or

payment of the redeemed
value, the goods shall be
released and all liabilities
which may attach to the
goods shall be discharged
without prejudice to the filing
of administrative or criminal
case.

Settlement of any seizure

case by payment of the fine
or redemption of forfeited
goods shall not be allowed
when there is fraud, or where
the importation is prohibited
or the release of the goods is
contrary to law.

Sec. 1125. Decision in

Forfeiture Cases. – In
forfeiture cases, the District
Collector shall issue an order
for hearing within fifteen (15)
days, or five (5) days in case
of perishable goods, from
issuance of the warrant. The
District Collector shall render
a decision within thirty (30)
days upon termination of the
hearing, or within ten (10)
days in case of perishable
goods. The decision shall
include a declaration of
forfeiture, the imposition of a
fine or such other action as
may be proper.

CHAPTER 5

APPEAL IN PROTEST AND

FORFEITURE CASES

Sec. 1126. Appeal to the

Commissioner. – In forfeiture
cases, the person aggrieved
by the decision of a District
Collector may, within fifteen
(15) days or five (5) days in
case of perishable goods,
from receipt of the decision,
file a written notice of appeal,
together with the required
appeal fee to the District
Collector, furnishing a copy to
the Commissioner. The
District Collector shall
immediately transmit all the
records of the proceedings to
the Commissioner, who shall
review and decide on the
appeal within thirty (30) days
from receipt of the records, or
fifteen (15) days in the case
of perishable goods:
Provided, That if within thirty
(30) days, no decision is
rendered, the decision of the
District Collector under
appeal shall be deemed
affirmed. An appeal filed
beyond the period herein
prescribed shall be
dismissed.

Appeals to protest cases

shall be governed by Section
114 of this Act.

The decision of the

Commissioner may be
served through the
recognized modes of service
under existing law.

Sec. 1127. Automatic Review

in Forfeiture Cases. – The
Commissioner shall
automatically review any
decision by the District
Collector adverse to the
government. The entire
records of the case shall be
elevated within five (5) days
from the promulgation of the
decision. The Commissioner
shall decide on the automatic
review within thirty (30) days,
or within ten (10) days in the
case of perishable goods,
from receipt of the records.
When no decision is
rendered within the
prescribed period or when a
decision adverse to the
government is rendered by
the Commissioner involving
goods with FOB or FCA
value of ten million pesos
(P10,000,000.00) or more,
the records of the decision of
the Commissioner, or of the
District Collector under
review, as the case may be,
shall be automatically
elevated within five (5) days
for review by the Secretary of
Finance. The decision issued
by the Secretary of Finance,
whether or not a decision
was rendered by the
Commissioner within thirty
(30) days, or within ten (10)
days in the case of
perishable goods, from
receipt of the records, shall
be final upon the Bureau.

Sec. 1128. Automatic Review

by the Secretary of Finance
in Other Cases. – In cases
not involving protest or
forfeiture, the Commissioner
shall automatically review
any decision by the District
Collector that is adverse to
the government. The records
of the case shall be elevated
to the Commissioner within
five (5) days from the
promulgation of the decision.
The Commissioner shall
decide on the automatic
review within thirty (30) days
from receipt of the records, or
within ten (10) days in the
case of perishable goods.
When no decision is
rendered within the
prescribed period or when
any decision rendered by the
Commissioner is adverse to
the government, the records
of the ease under review
shall be automatically
elevated within five (5) days
for the review of the
Secretary of Finance. The
decision issued by the
Secretary of Finance,
whether or not a decision
was rendered by the
Commissioner within thirty
(30) days from receipt of the
records, or within ten (10)
days in the case of
perishable goods, shall be
final upon the Bureau.

CHAPTER 6

ABANDONMENT

Sec. 1129. Abandonment,

Kinds and Effects of. –
Imported goods are deemed
abandoned under any of the
following circumstances:

(a) When the owner,

importer, or consignee of the
imported goods expressly
signifies in writing to the
District Collector the intention
to abandon the same; or

(b) When the owner,

importer, consignee, or
interested party after due
notice, fails to file the goods
declaration within the
prescribed period in Section
407 of this Act: Provided,
That the term goods
declaration shall include
provisional or incomplete
goods declaration deemed
valid by the Bureau as
provided in Section 403 of
this Act. For this purpose, it
is the duty of the District
Collector to post a list of all
packages discharged and
their consignees, whether
electronically or physically in
the District Office, or send a
notice to the consignee within
five (5) days from the date of
discharge; or

(c) Having filed such goods

declaration, the owner,
importer, consignee or
interested party after due
notice, fails to pay the
assessed duties, taxes and
other charges thereon, or, if
the regulated goods failed to
comply with Section 117 of
this Act, within fifteen (15)
days from the date of final
assessment: Provided, That if
such regulated goods are
subject of an alert order and
the assessed duties, taxes
and other charges thereof are
not paid within fifteen (15)
days from notification by the
Bureau of the resolution of
the alert order, the same
shall also be deemed
abandoned; or

(d) Having paid the assessed

duties, taxes and other
charges, the owner, importer
or consignee or interested
party after due notice, fails to
claim the goods within thirty
(30) days from payment. For
this purpose, the arrastre or
warehouse operator shall
report the unclaimed goods
to the District Collector for
disposition pursuant to the
provisions of this Act; or

(e) When the owner or

importer fails to claim goods
in customs bonded
warehouses within the
prescribed period.

The due notice requirement

under this section may be
provided by the Bureau
through electronic notice or
personal service: Provided,
That for non-regular
importers, notification shall
be by registered mail or
personal service. For this
purpose, the accreditation of
importers, exporters, and
other third parties shall
include provision for
mandatory receipt of
electronic notices.

Sec. 1130. Treatment and

Disposition of Abandoned
Goods. – Expressly
abandoned goods under
paragraph (a) of Section
1129 of this Act shall ipso
facto be deemed the property
of the government and shall
be disposed of in accordance
with the provisions of this Act.

If the Bureau has not

disposed of the abandoned
goods, the owner or importer
of goods impliedly
abandoned may, at any time
within thirty (30) days after
the lapse of the prescribed
period to file the declaration,
reclaim the goods provided
that all legal requirements
have been complied with and
the corresponding duties,
taxes and other charges,
without prejudice to charges
and fees due to the port or
terminal operator, as well as
expenses incurred have been
paid before the release of the
goods from customs custody.

When the Bureau sells goods

which have been impliedly
abandoned, although no
offense has been discovered,
the proceeds of the sale,
after deduction of any duty
and tax and all other charges
and expenses incurred as
provided in Section 1143 of
this Act, shall be turned over
to those persons entitled to
receive them or, when this is
not possible, held at their
disposal for a specified
period. After the lapse of the
specified period, the balance
shall be transferred to the
forfeiture fund as provided in
Section 1151 of this Act.
CHAPTER 7

OTHER ADMINISTRATIVE
PROCEEDINGS

Sec. 1131. Authority of the

Commissioner to Make
Compromise. – Subject to the
approval of the Secretary of
Finance, the Commissioner
may compromise any
administrative case arising
under this Act involving the
imposition of fines and
surcharges, including those
arising from the conduct of a
post clearance audit, unless
otherwise specified by law.

Cases involving forfeiture

proceedings shall however
not be subject to any
compromise.

CHAPTER 8

CIVIL REMEDIES FOR THE

COLLECTION OF DUTIES
AND TAXES

Sec. 1132. Remedies for the

Collection of Duties, Taxes,
Fines, Surcharges, Interests,
and Other Charges. – The
civil remedies for the
collection of import duties,
taxes, fees, or charges
resulting from the conduct of
a post clearance audit shall
be obtained by:
(a) Distraint of goods,
chattels, or effects, and other
personal property of
whatever character, including
stocks and other securities,
debts, credits, bank
accounts, and interest in and
rights to personal property,
and by levy upon real
property and interest in rights
to real property; and (b) Civil
or criminal action.

Either or both of these

remedies may be pursued at
the discretion of the Bureau:
Provided, That the remedies
of distraint and levy shall not
be allowed when the amount
of duties and taxes involved
is not more than ten
thousand pesos (10,000.00).

The Bureau shall advance

the amounts needed to
defray costs of collection by
means of civil or criminal
action, including the
preservation or transportation
of personal property
distrained and the
advertisement and sale
thereof, as well as of real
property and improvements
thereon.

Sec. 1133. Constructive

Distraint of the Property. – To
safeguard the interest of the
government, the
Commissioner may place
under constructive distraint
the property of a delinquent
importer who, in the opinion
of the Commissioner, is
retiring from any business
subject to duty and tax, or is
intending to leave the
Philippines, or to remove the
property therefrom, or to hide
or conceal the property, or to
perform any act tending to
obstruct the proceedings for
collecting the duty and tax
due, or which may be due.

The constructive distraint of

personal property shall be
effected by requiring the
importer or any person in
possession or control of such
property to sign a receipt
covering the property, to
obligate to preserve the
distrained property on the
state and condition at the
time of the government's
seizure of the same, and not
to dispose of the same in any
manner whatsoever, without
the express authority of the
Commissioner.

In case the importer or the

person in possession and
control of the property sought
to be placed under
constructive distraint refuses
or fails to sign the receipt
herein referred to, the
customs officer effecting the
constructive distraint shall
proceed to prepare a list of
such property and, in the
presence of two (2)
witnesses, leave a copy
thereof in the premises where
the property distrained is
located, after which the said
property shall be deemed to
have been placed under
constructive distraint.

Sec. 1134. Summary

Remedies. – (A) Distraint of
Personal Property. – Upon
failure of the person owing
any delinquent duty, tax and
other charges to pay at the
time required, the
Commissioner shall seize
and distraint the goods,
chattels or effects, and the
personal property, including
stocks and other securities,
debts, credits, bank
accounts, and interests in
and rights to personal
property of such persons, in
sufficient quantity to satisfy
the duty, tax or other charge
and the expenses of the
distraint and the cost of the
subsequent sale.

The officer serving the

warrant of distraint shall
make or cause to be made
an account of the goods,
chattels, effects, or other
personal property distrained,
a copy of which, signed by
the said officer, shall be left
either with the owner or
person from whose
possession such goods,
chattels, or effects or other
personal property were
taken, or at the dwelling or
other place of business of
such person and with
someone of suitable age and
discretion, to which list shall
be added a statement of the
sum demanded and note of
the time and place of sale.

Stocks and other securities

shall be distrained by serving
a copy of the warrant of
distraint upon the importer
and upon the president,
manager, treasurer, or other
responsible officer of the
corporation, company or
association, which issued the
said stocks or securities.

Debts and credits shall be

distrained by leaving with the
person owing the debts or
having in his/her possession
or under his/her control such
credits, or with his/her agent,
a copy of the warrant of
distraint. The warrant of
distraint shall be sufficient
authority to the person owing
the debts or having in his
possession or under his
control any credits belonging
to the importer to pay to the
Commissioner the amount of
such debts of credits.

Bank accounts shall be

garnished by serving a
warrant of garnishment upon
the importer and upon the
president, manager,
treasurer, or other
responsible officer of the
bank Upon the receipt of the
warrant of garnishment, the
bank shall turn over to the
Commissioner so much of
the bank accounts as may be
sufficient to satisfy the claim
of the government.

A report on the distraint shall,

within ten (10) days from
receipt of the warrant, be
submitted by the
Commissioner to the
Secretary of Finance:
Provided, That the
Commissioner shall have the
power to lift such order of
distraint subject to the rules
and regulations promulgated
pursuant to this Act.

(B) Levy on Real Property. –

After the expiration of the
period within which to pay the
duty, tax and other charges
as prescribed in this section,
real property may be levied
upon, before, simultaneously,
or after the distraint of
personal property belonging
to the importer. To this end,
the Commissioner or the duly
authorized representative
shall prepare a duly
authenticated certificate
showing the name of the
importer and the amounts of
the duty and tax and penalty
due. The certificate shall
operate with the force of a
legal execution throughout
the Philippines.

The levy shall be effected by

writing upon the certificate a
description of the property on
which levy is made. At the
same time, written notice of
the levy shall be mailed to or
served upon the register of
deeds of the province or city
where the property is located
and upon the importer, or if
the latter is not in the
Philippines, upon the agent
or the manager of the
business from which the
liability arose, or if there be
none, to the occupant of the
property in question.

In case the warrant of levy on

real property is not issued
before or simultaneously with
the warrant of distraint on
personal property, and the
personal property of the
importer is not sufficient to
satisfy the duty and tax due,
the Commissioner or a duly
authorized representative
shall, within thirty (30) days
after execution of the
distraint, proceed with the
levy on the real property of
the importer.

Within ten (10) days after

receipt of the warrant, a
report on any levy shall be
submitted by the levying
officer to the Commissioner:
Provided, That the
Commissioner may lift such
warrants of levy issued,
subject to the rules and
regulations promulgated
pursuant to this Act.

CHAPTER 9

JUDICIAL PROCEEDINGS

Sec. 1135. Supervision and

Control over Criminal and
Civil Proceedings. – Civil and
criminal actions and
proceedings instituted on
behalf of the Government
under the authority of this Act
or other laws enforced by the
Bureau shall be brought in
the name of the government
of the Philippines and shall
be prosecuted and handled
by the Bureau with the
assistance of the Department
of Justice (DOJ): Provided,
That the determination of the
existence of probable cause
and the subsequent filing of
any criminal or civil case with
the proper court against
violators of this Act shall
exclusively belong to the
DOJ: Provided, however,
That no civil or criminal action
for the recovery of duties or
the enforcement of any fine,
penalty or forfeiture under
this Act shall be filed in court
without the approval of the
Commissioner.

Sec. 1136. Review by the

CTA. – Unless otherwise
provided in this Act or by any
other law, the party aggrieved
by the ruling or decisions of
the Commissioner may
appeal to the CTA, in the
manner and within the period
prescribed by law and
regulations. Decisions of the
Secretary of Finance when
required by this Act, may
likewise be appealed to the
CTA.

Unless an appeal is made to

the CTA in the manner and
within the period prescribed
by law and regulations, the
ruling or decision of the
Commissioner or the
Secretary of Finance shall be
final and executory.

Sec. 1137. Exclusive

Jurisdiction of the Bureau. –
Jurisdiction over imported
goods and goods for
exportation shall be exclusive
to the Bureau, or the
Secretary of Finance, when
under review by the latter,
subject to the proceedings
described in this title.

Except for the CIA, no court

may issue any order or
decision until all the remedies
for administrative appeal
have been exhausted.

Sec. 1138. Fraud

Investigation and
Prosecution. – No criminal
case for violation of this title
shall be instituted without the
approval of the
Commissioner pursuant to
the provisions of this Act.

The Bureau shall have the

power to investigate and
institute smuggling cases
committed within its
jurisdiction: Provided, That in
case of inquest, the same
may be instituted by the
apprehending customs
officer.

CHAPTER 10

DISPOSITION OF
PROPERTY IN CUSTOMS
CUSTODY

Sec. 1139. Goods Subject to

Disposition. – Goods in
customs custody that are in
the following conditions and
status shall be subject to
disposition:

(a) Abandoned goods;

(b) Goods entered under

warehousing entry but not
withdrawn, or those whose
duties and taxes have not
been paid within the period
prescribed under Section 811
of this Act;

(c) Forfeited goods, other

than prohibited, restricted
and regulated goods; after
liability have been
established by the proper
administrative or judicial
proceedings in conformity
with the provisions of this Act;
and

(d) Goods subject to a valid

lien for customs duties, taxes
and other charges collectible
by the Bureau, after the
expiration of the period
allowed for payment thereof.

Sec. 1140. Place of

Disposition of Goods. – Upon
the order of the District
Collector, goods may be sold
or otherwise disposed of at
the port where the goods are
located, unless the
Commissioner shall direct its
transfer to another port.

Sec. 1141. Mode of

Disposition. – The goods
subject to disposition may be
donated to another
government agency or
declared for official use of the
Bureau, after approval of the
Secretary of Finance, or sold
at a public auction within
thirty (30) days after a ten
(10)-day notice posted at a
public place at the port where
the goods are located and
published electronically or in
a newspaper of general
circulation.

For purposes of donating the

goods as above described,
goods suitable for shelter or
consisting of foodstuffs,
clothing materials or
medicines may be donated to
the DSWD.

Sec. 1142. Disqualification to

Participate in Auction Sale. –
No customs officer or
employee, their spouses and
relatives within the fourth
degree of consanguinity or
affinity shall be allowed to bid
directly or indirectly, in any
customs auction.

Sec. 1143. Disposition of

Proceeds. – The following
expenses and obligations
shall be paid from the
proceeds of the sale in the
order provided:

(a) Customs duties, except in

the case of forfeited goods;

(b) Taxes and other charges

due the government;

(c) Government storage

charges;

(d) Expenses for the

appraisal, advertisement, and
sale of auctioned goods;
(e) Arrastre and private
storage charges and
demurrage charges; and

(f) Freight, lighterage or

general average, on the
voyage of importation, of
which due notice shall have
been given to the District
Collector.

The Commissioner is
authorized to determine the
maximum charges to be
recovered by private entities
concerned under subsections
(e) and (f) of this section.

Sec. 1144. Disposition of

Perishable Goods. –
Perishable goods as defined
under this Act when certified
as such by the Bureau, may
be sold at a public auction
within five (5) days, after a
three (3)-day notice.

For this purpose, perishable

goods shall include goods
liable to perish or be wasted,
or those that depreciate
greatly in value while stored,
or which cannot be kept
without great disproportionate
expense. The Bureau shall
proceed to advertise and sell
the same at auction upon
notice as shall be deemed to
be reasonable. Sec. 1145.
Disposition of Goods
Injurious to Public Health. –
Goods in the custody of the
Bureau which, in the opinion
of the District Collector are
injurious to public health,
shall be seized. The District
Collector shall, if the matter is
not disposable under the
provisions relating to food
and drugs, appoint three (3)
members to constitute a
Board to examine the goods.
The Board shall be
composed of one (1)
representative from either the
DOH or other appropriate
government agency or the
local government unit (LGU)
concerned, and two (2)
representatives from the
Bureau. If the goods are
found to be injurious to public
health, the Board shall report
this to the District Collector,
who shall order its
destruction in an appropriate
manner or order its
reexportation in accordance
with this Act.

The District Collector shall

immediately coordinate with
the health and quarantine
officers at the port of entry for
the disposition of goods
injurious to public health.

Sec. 1146. Disposition of

Prohibited Good. – Prohibited
goods, as provided in Section
118 of this Act, shall be
destroyed, except paragraph
(d) thereof which shall be
turned over to the BSP. All
goods suitable for shelter,
foodstuffs, clothing materials
or medicines may be
disposed in accordance with
Section 1141 of this Act.

Sec. 1147. Disposition of

Restricted Goods. –
Restricted goods as
described in Section 119 of
this Act shall be disposed as
follows:

(a) Dynamite, gunpowder,

ammunitions and other
explosives, firearms and
weapons of war, and parts
thereof shall be turned over
to the AFP;

(b) Roulette wheels,

gambling outfits, loaded dice,
marked cards, machines,
apparatus or mechanical
devices used in gambling or
the distribution of money,
cigars, cigarettes, or other
goods when such distribution
is dependent on chance,
including jackpot and pinball
machines or similar
contrivances, or parts thereof
shall be turned over to the
appropriate government body
or agency;

(c) Lottery and sweepstakes

tickets, except
advertisements thereof, and
lists of drawings therein shall
be turned over to the
appropriate government body
or agency;

(d) Marijuana, opium,

poppies, coca leaves, heroin,
or other narcotics or synthetic
drugs which are or may
hereafter be declared habit
forming by the President of
the Philippines, or any
compound, manufactured
salt, derivative, or preparation
thereof, shall be turned over
to the Dangerous Drugs
Board;

(e) Opium pipes and parts

thereof, of whatever material,
shall be turned over to the
Dangerous Drugs Board; and

(f) All other restricted goods

which are highly dangerous
to be kept or handled shall be
destroyed in a manner as the
District Collector deems
appropriate. Otherwise, the
restricted goods shall be
turned over to the proper
government agency for
appropriate handling.

Sec. 1148. Disposition of

Regulated Goods. –
Regulated goods shall be
disposed of in a manner to be
determined by the
appropriate regulatory
agency. In the event that the
regulatory agency allows the
disposition of the regulated
goods with commercial value
and capable of legitimate
use, these shall be disposed
of in accordance with Section
1141 of this Act.

Sec. 1149. Disposition of

Unsold Goods for Want of
Bidders. – Goods subject to
sale at public auction by the
Bureau shall be sold at a
price not less than the landed
cost of the goods adjusted for
normal depreciation.

Goods which remain unsold

after at least two (2) public
biddings either due to the
lack of bidders or for the lack
of an acceptable bid, may be
donated to another
government agency or
declared for official use of the
Bureau. If the goods are not
suitable either for official use
or donation, these may be
subject to reexport as
government property or sold
through a negotiated sale. In
case of negotiated sale, the
same shall be subject to the
approval of the Secretary of
Finance and executed in the
presence of a representative
of the COA. For purposes of
donating the goods as above
described, goods suitable for
shelter or consisting of
foodstuffs, clothing materials
or medicines may be donated
to the DSWD.
Sec. 1150. Disposition of
Smuggled Goods. –
Smuggled goods, when
forfeited, shall be disposed of
as provided in Section 1148
of this Act.

Sec. 1151. Forfeiture Fund. –

All proceeds from public
auction sales after deduction
of the charges as provided in
Section 1143 of this Act and
subject to the claim of the
owner or importer of an
impliedly abandoned goods
as provided in Section 1130
of this Act, shall be deposited
in an account to be known as
Forfeiture Fund.

The Fund shall be in the

name of and shall be
managed by the Bureau
which is hereby authorized,
subject to the usual
government accounting rules
and regulations, to utilize it
for the following purposes:

(a) To outsource, subject to

the rules on government
procurement established by
law, the management of the
inventory, safekeeping,
maintenance and sale of
goods enumerated in Section
1139 of this Act to private
service providers: Provided,
That the Bureau shall retain
jurisdictional control and
supervision over these goods
as well as the operations of
the service provider so
contracted;

(b) To facilitate customs

seizure, abandonment and
forfeiture proceedings and
the disposition of goods
under Section 1139 of this
Act, particularly those to be
disposed of other than
through public sale;

(c) To enhance customs

intelligence and enforcement
capability to prevent
smuggling; and

(d) To support the

modernization program and
other operational efficiency
and trade facilitation
initiatives of the Bureau.

The DOF and the

Department of Budget and
Management (DBM) shall,
upon the recommendation of
the Bureau, issue a joint
regulation to implement the
provisions of this section.

TITLE XII

THIRD PARTIES

CHAPTER 1

CUSTOMS SERVICE
PROVIDERS

Sec. 1200. Customs Brokers

and Other Service Providers.
– Upon the recommendation
of the Commissioner, the
Secretary of Finance shall
issue the necessary rules
and regulations for the
registration of customs
brokers and the accreditation
of other customs service
providers to ensure
compliance with this Act and
the rules and regulations that
shall be promulgated to
implement it.

CHAPTER 2

CARRIERS, VESSELS, AND

AIRCRAFTS

Sec. 1201. Ports Open to

Vessels and Aircrafts
Engaged in Foreign Trade. –
Vessels and aircrafts
engaged in foreign trade shall
visit designated ports of entry
only except as otherwise
especially allowed by law:
Provided, That no existing
and valid government
contract covering the
handling of import and export
cargo shall be diminished or
impaired. Every vessel or
aircraft arriving within a
Customs District of the
Philippines from a foreign
port shall dock at the
designated port of entry and
shall be subject to the
authority of the District
Collector of the port while
within its jurisdiction.
Sec. 1202. Control of
Customs Officer Over
Boarding or Leaving of
Incoming Vessel and Over
Other Vessel Approaching
the Former. – Upon the
arrival in port of any vessel
engaged in foreign trade, it
shall be unlawful for any
person, except the pilot,
consul, quarantine officers,
customs officers, or other
duly authorized persons, to
board or leave the vessel
without permission of the
customs officer concerned. It
shall likewise be unlawful for
any tugboat, rowboat, or
other craft to go alongside
such vessel and for any
person so authorized to
board the vessel to take any
unauthorized person to board
the same, or allow loitering
near or alongside such
vessel. Unauthorized
tugboats and other vessels
shall keep away from such
vessel engaged in foreign
trade at a distance of not less
than fifty (50) meters.

Sec. 1203. Documents to be

Produced by the Master
Upon Entry of Vessel. – Upon
entry of a vessel engaged in
foreign trade, the master
thereof shall present the
following certified documents
to the customs boarding
officers:
(a) The vessel's general
declaration;

(b) The original manifest of all

cargoes destined for the port,
to be returned with the
endorsement of the boarding
officers;

(c) Three (3) copies of the

original manifest, one of
which, upon certification by
the boarding officer as to the
correctness of the copy, shall
be returned to the master;

(d) A copy of the cargo

stowage plan;

(e) Two (2) copies of the

store list;

(f) One (1) copy of the

passengers list;

(g) One (1) copy of the crew

list;

(h) The original copy of all

through cargo manifest, for
deposit with the customs
officer who has jurisdiction
over the vessel while in port;

(i) The passengers manifest

containing the names of all
foreigners, in conformity with
the requirements of the
immigration laws in force in
the Philippines;
(j) One (1) copy of the
original duplicate of fully
accomplished bill of lading;

(k) The shipping goods and

register of the vessel of
Philippine registry; and

(l) Such other related

documents.

Sec. 1204. Manifest Required

of Vessel from Foreign Port.
– Every vessel from a foreign
port must have on board a
complete manifest of all its
cargoes.

All cargoes intended to be

landed at a port in the
Philippines must be
described in separate
manifests for each port of
call. Each manifest shall
include the port of departure
and the port of delivery with,
the marks, numbers, quantity,
and description of the
packages and the names of
the consignees. Every vessel
from a foreign port must have
on board complete manifests
of passengers and baggage,
in the prescribed form, setting
forth the destination and all
particulars required by
immigration laws. Every
vessel shall present to the
proper customs officers upon
arrival in ports of the
Philippines a complete list of
all sea stores then on board.
If the vessel does not carry
cargo or passengers, the
manifest must show that no
cargo or passenger is carried
from the port of departure to
the port of destination in the
Philippines.

A true and complete copy of

the cargo manifest shall be
electronically sent in advance
by the shipping company,
NVOCC, freight forwarder,
cargo consolidator, or their
agents within the cut-off
period as may be determined
by the Bureau before the
arrival of the carrying vessel
at the port of entry. Upon
arrival of the carrying vessel,
the shipping company,
NVOCC, freight forwarder,
cargo consolidator, or their
agents shall provide two (2)
hard copies of the cargo
manifest to the Bureau in
case the port of entry is either
the Port of Manila (PoM) or
the Manila International
Container Port (MICP), and
one (1) copy only in the case
of the other ports of entry.

A cargo manifest shall in no

case be changed or altered
after entry of vessel, except
by means of an amendment,
under oath, by the master,
consignee or agent thereof,
which shall be attached to the
original manifest: Provided,
That after the invoice and/or
goods declaration covering
an importation have been
received and recorded in the
office of the appraiser, no
amendment of the manifest
shall be allowed, except
when it is obvious that a
clerical error or any other
discrepancy has been
committed in the preparation
of the manifest, without any
fraudulent intent, the
discovery of which would not
have been made until after
examination of the
importation has been
completed. Sec. 1205.
Translation of Manifest. –
The cargo manifest and each
copy thereof shall be
accompanied by a translation
in English, if originally written
in another language.

Sec. 1206. Manifests for the

Commission on Audit and
District Collector. – Upon
arrival of a vessel from a
foreign port, the Bureau shall
provide electronic copies of
the manifest to the
Chairperson of the COA. The
master shall immediately
present to the District
Collector the original copy of
the cargo manifest properly
endorsed by the boarding
officer, and for inspection, the
ship's register, or other
documents in lieu thereof,
together with the clearance
and other papers granted to
the vessel at the port of
departure for the Philippines.

Sec. 1207. Production of

Philippine Crew. – The
master of a Philippine vessel
returning from abroad shall
produce the entire crew listed
in the vessel's shipping crew
manifest. If any member is
missing, the master shall
produce proof satisfactory to
the District Collector that the
member has died, or
absconded, has been forcibly
impressed into another
service, or has been
discharged. In case of
discharge in a foreign
country, the master shall
produce a certificate from the
consul, vice consul, or
consular agent of the
Philippines there residing,
showing that such discharge
was effected with the consent
of the aforesaid
representative of the
Philippines.

Sec. 1208. Record of Arrival

and Entry of Vessels and
Aircraft. – A record shall be
made and kept open to public
inspection in every Customs
District of the date of arrival
and entry of all vessels and
aircraft.

Sec. 1209. Arrest of Vessel

or Aircraft Departing Before
Entry Made. – When a vessel

"Sec. 1210. Disposition of
Imported Articles Remaining
on Vessel after Time for
Unloading. — Imported
articles remaining on board
any vessel after the
expiration of the said period
for discharge, and not
reported for transshipment to
another port, may be unladen
by the customs authorities
and stored at the vessel's
expense.
"Unless prevented by
causes beyond the vessel's
control, such as port
congestion, strikes, riots or
civil commotions, failures of
vessel's gear, bad weather,
and similar causes, articles
so stored shall be entered
within thirty (30) days, which
shall not be extendible, from
the date of discharge of the
or aircraft arriving within the
limits of a Customs District
from a foreign port departs or
attempts to depart before
entry shall have been made,
not being thereunto
compelled by stress of
weather, duress of enemies,
or other necessity, the District
Collector of the port may
cause the arrest and bring
back such vessel or aircraft
to the most convenient port
with the assistance of other
concerned agencies.
Sec. 1210. Discharge of
Ballast. – When not brought
to port as goods, ballast of no
commercial value may be
discharged upon permit
granted by the District
Collector for the purpose.
Sec. 1211. Time of Unloading
Cargo. – Unloading of cargo
from a vessel or aircraft from
a foreign port during official
nonworking hours shall be
allowed subject to payment of
service fees by shipping
lines, airlines, or other
interested p arties at rates
prescribed by the
Commissioner.
Sec. 1212. Entrance of
Vessel through Necessity. –
When a vessel from a foreign
port is compelled, by stress
of weather or other necessity
to put into any other port than
last package from the vessel
or aircraft and shall be
claimed within fifteen (15)
days, which shall not likewise
be extendible from the date
of posting of the notice to
claim in conspicuous places
in the Bureau of Customs. If
not entered or not claimed, it
shall be disposed of in
accordance with the
provisions of this Code."
that of its destination, the
master within twenty-four (24)
hours after its arrival, shall
make a protest under oath
setting forth the causes or
circumstances of such
necessity. This protest, if not
made before the District
Collector, must be produced
and lodged with the District
Collector.
Within the same time, the
master shall make a report to
the District Collector if any
part of the cargo was
unloaded from necessity or
lost by casualty before
arrival, and produce sufficient
proof to the District Collector
of such necessity or casualty
before the latter who shall
give the approval thereto and
the unloading shall be
deemed to have been
lawfully effected.
Sec. 1213. Unloading of
Vessel in Port from
Necessity. – If a situation
arises where the unloading of
the vessel is required
pending sojourn in port, the
District Collector shall, upon
sufficient proof of the
necessity, grant a permit
therefore, and the goods
shall be unloaded and stored
under the supervision of
customs officers.
At the request of the master
of the vessel or the owner
thereof, the District Collector
may grant permission to
enter the port and pay duties,
taxes and other charges on,
and dispose of, such part of
the cargo as may be
perishable in nature or as
may be necessary to defray
the expenses attending the
vessel.

Upon departure, the cargo, or

a part thereof, may be
reloaded on board the vessel,
and the vessel may proceed
with the same to its
destination, subject only to
the charge for storing and
safekeeping of the goods and
the fees for entrance and
clearance. No port charges
shall be collected on vessels
entering through stress of
weather, duress or other
urgent necessities.

Sec. 1214. Entry and

Clearance of Vessels of a
Foreign Government. – The
entry and clearance of
transport or supply ship of a
foreign government shall be
in accordance with the
agreement by and between
the Philippines and the
foreign government.

Sec. 1215. Clearance of

Vessel for Foreign Port. –
Before a clearance shall be
granted to any vessel bound
to a foreign port, the master
or the agent thereof shall
present to the District
Collector the following
properly authenticated
documents:

(a) A bill of health from the

quarantine officer or officer of
the public health service in
the port;

(b) Three (3) copies of the

manifest of export cargo, one
of which, upon certification by
the customs officer as to the
correctness of the copy, shall
be returned to the master;

(c) Two (2) copies of the

passengers list, showing
foreigners and other
passengers;

(d) The register and shipping

goods, if the vessel is of
Philippine registry;

(e) Clearance issued by the

last port of entry; and

(f) A certificate from the

Philippine Postal Corporation
to the effect that it received
timely notice of the sailing of
the vessel: Provided, That
the District Collector shall not
permit any vessel to sail for a
foreign port if the master or
agent thereof refuses to
receive bags of mail
delivered to the same by the
Philippine Postal Corporation
for transport upon reasonable
compensation. In case the
Postmaster General and the
master or agent do not come
to an agreement concerning
the amount of the
compensation to be paid for
the carriage of the mail, the
matter shall be submitted for
decision to a Board of
Referees to be composed of
three (3) members appointed,
respectively, by the Philippine
Postal Corporation, the
agency of the company to
which the vessel concerned
belongs, and the Bureau,
who shall fix a reasonable
rate of compensation.

Sec. 1216. Detention of

Warlike Vessel Containing
Arms and Munitions. –
District Collectors shall report
to the proper authorities or
detain any vessel of
commercial registry
manifestly built for warlike
purposes and about to depart
from the Philippines with a
cargo consisting principally of
arms and munitions of war,

when the number of men

shipped on board or other
circumstances render it
probable that such vessel is
intended to be employed by
the owner or owners to cruise
or commit hostilities upon the
subjects, citizens, or property
of any foreign principality or
state, or of any colony,
district, or people with whom
the Philippines is at peace,
until the decision of the
President of the Philippines is
rendered thereon, or until the
owner or owners shall give a
security, in double the value
of the vessel and cargo, that
it will not be so employed, if
in the discretion of the District
Collector such security will
prevent the violation of the
provisions of this section.

Sec. 1217. Oath of Master of

Departing Vessel. – The
master of a departing vessel
shall state under oath that:

(a) All cargoes conveyed on

the vessel, destined for the
Philippines, have been duly
discharged or accounted for;

(b) A true copy of the

outgoing cargo manifest has
been furnished to the Bureau;

(c) No letters or packets, not

enclosed in properly stamped
envelope sufficient to cover
postage, have been received
or will be conveyed, except
those relating to the vessel;
and that all mails placed on
board the vessel before its
last clearance from the
Philippines have been
delivered at the proper
foreign port; and

(d) If clearing without

passenger, the vessel will not
carry upon the instant
voyage, from the Philippine
port; any passenger of any
class, or other person not
entered upon the ship's
declaration.

Sec. 1218. Extension of Time

for Clearance. – At the time
of clearance, the master of a
departing vessel shall be
required to indicate the time
of intended departure, and if
the vessel should remain in
port forty-eight (48) hours
after the time indicated, the
master shall report to the
District Collector for an
extension of time of
departure, and without such
extension the original
clearance shall be nullified.

Sec. 1219. Advance Notice of

Aircraft Arrival. – (A)
Nonscheduled Arrivals. –
Before an aircraft comes into
any area in the Philippines
from any place outside
thereof, a timely notice of the
intended flight shall be
furnished to the District
Collector or other customs
officer-in-charge at or nearest
the intended place of first
landing, and to the
quarantine and immigration
officers-in-charge at or
nearest such place of
landing. If dependable
facilities for giving notice are
not available before
departure, the use of any
radio equipment shall be
appropriate as long as it will
result in the giving of
adequate and timely notice of
the aircraft's approach,
otherwise landing shall be
made at a place equipped
with navigational facilities. If,
upon landing in any area, the
government officers have not
arrived, the pilot-in-command
shall hold the aircraft and any
baggage and goods thereon
intact and keep the
passengers and crew
members in a segregated
place until the inspecting
officers arrive.

(B) Scheduled Arrivals. –

Such advance notice will not
be required in the case of an
airline arriving in accordance
with the regular schedule
filed with the District Collector
for the Customs District in
which the place of first
landing area is situated, and
also with the quarantine and
immigration officers-in-charge
of such place.

Sec. 1220. Landing at

International Airport of Entry.
– Except in case of
emergency or forced
landings, aircraft arriving in
the Philippines from any
foreign port or place shall
make the first landing at an
international airport of entry,
unless permission to land
elsewhere other than at an
international airport of entry is
first obtained from the
Commissioner. In such
cases, the owner, operator,
or person in charge of the
aircraft shall pay the
expenses incurred in
inspecting the aircraft, goods,
passengers, and baggage
carried thereon, and such
aircraft shall be subject to the
authority of the District
Collector at the airport while
within its jurisdiction.

Should an emergency or
forced landing be made by an
aircraft coming into the
Philippines at a place outside
the jurisdiction of the latter,
the pilot-in-command shall
not allow goods, baggage,
passenger, or crew member
to be removed or to depart
from the landing place
without permission of a
customs officer, unless such
removal or departure is
necessary for purposes of
safety, communication with
customs officers, or
preservation of life, health, or
property. As soon as
practicable, the pilot-in-
command, or a member of
the crew-in-charge, or the
owner of the aircraft, shall
communicate with the
customs officer at the
intended place of first landing
or at the nearest international
airport or other customs port
of entry in the area and make
a full report of the
circumstances of the flight
and of the emergency or
forced landing.

Sec. 1221. Report of Arrival

and Entry of Aircraft. – The
pilot-in-command of any
aircraft arriving from a foreign
port or place shall
immediately report its arrival
to the District Collector at the
airport of entry or to the
customs officer detailed to
meet the aircraft at the place
of first landing. Upon arrival,
such aircraft shall be boarded
by a quarantine officer, and
after pratique or health
clearance is granted, shall be
boarded by a customs officer;
subsequently no person shall
be permitted to board or
leave the aircraft without the
permission of the customs
officer. The pilot-in-command
or any other authorized agent
of the owner or operator of
the aircraft shall make the
necessary entry. No such
aircraft shall, without previous
permission from the District
Collector, depart from the
place of first landing or
discharge goods,
passengers, or baggage.

Sec. 1222. Documents

Required in Making Entry for
Aircraft. – (a) For the purpose
of making entry, there shall
be presented to the boarding
customs officer four (4)
copies of a general
declaration which shall
contain the following data,
unless any of such data is
otherwise presented on a
separate official form:

(1) Name of owner or

operator of aircraft,
registration marks and
nationality of aircraft, and
flight number of identification;

(2) Points of clearance and

entry, and date of arrival;

(3) Health and customs

clearance at the last airport of
departure;

(4) Itinerary of aircraft,

including information as to
airport of origin and departure
dates;

(5) Names and nationality of

crew members;

(6) Passengers manifest

showing places of
embarkation and destination;
(7) Cargo manifest showing
information as to airway bill
number, the number of
packages related to each
airway bill number, nature of
goods, destination, and gross
weight, together with a copy
of each airway bill securely
attached thereto;

(8) Store list; and

(9) Such other documents as

may be required by the
Bureau.

(b) The general declaration

shall be written in English
and duly signed by the pilot-
in-command or operator of
the aircraft, or the authorized
agent. The section on health,
and customs clearances,
however, shall be signed only
by the pilot-in-command or
when necessary, by a crew
member when the general
declaration itself has been
signed by a non-crew
member. If the aircraft does
not carry cargoes or
passengers, such facts must
be shown in the manifest.

(c) A cargo manifest shall in

no case be changed or
altered after entry of the
aircraft, except by means of
an amendment by the pilot-
in-command or authorized
agent thereof, under oath,
and attached to the original
manifest: Provided, That after
the invoice and/or goods
declaration covering an
importation have been
received and recorded in the
office of the appraiser, no
amendment shall be allowed
except when it is obvious that
a clerical error or any other
discrepancy has been
committed without any
fraudulent intent in the
preparation of the manifest,
the discovery of which could
not have been made until
after complete examination of
the importation.

Sec. 1223. Manifests for the

Commission on Audit (COA)
and District Collector. – Upon
arrival of an aircraft from a
foreign port, the Bureau shall
provide electronic copies of
the manifest to the
Chairperson of the COA. The
master shall immediately
present to the District
Collector the original copy of
the cargo manifest properly
endorsed by the boarding
officer, and for inspection, the
aircraft's register or other
documents in lieu thereof,
together with the clearance
and other papers granted to
the aircraft at the port of
departure for the Philippines.

Sec. 1224. Clearance of

Aircraft for Foreign Port. – (a)
Any aircraft bound to a
foreign port shall, before
departure, be granted
clearance by the
Commissioner at an airport of
entry where such aircraft has
been authorized to make its
landing; and

(b) Before clearance shall be

granted to an aircraft bound
to a foreign port, there shall
be presented to the District
Collector or to the customs
officer detailed at the place of
departure four (4) copies of a
general declaration signed by
the pilot-in-command or
authorized agent of an
aircraft which shall contain
the following data; (1) Name
of owner or operator of
aircraft, registration marks
and nationality of aircraft, and
flight number of identification;

(2) Port of clearance, data

thereof and destination;

(3) Health and customs

clearance;

(4) Itinerary of aircraft,

including information as to
airport of destination and
departure date;

(5) Names and nationality of

crew members;

(6) Passengers manifest

showing places of
destination;
(7) Export cargo manifest
showing information as to
airway bill number, the
number of packages related
to each airway bill number,
nature of goods, destination,
and gross weight, together
with a copy of each airway
bill securely attached thereto;
and

(8) Store list showing stores

loaded.

Sec. 1225. Oath of Person-

in-Charge of Departing
Aircraft. – The pilot-in-
command or authorized
agent of such departing
aircraft shall also state under
oath to the effect that:

(a) All cargoes conveyed on

the aircraft destined to the
Philippines have been duly
discharged and accounted
for; and

(b) The aircraft has not

received nor will convey any
letter or packet not enclosed
in properly stamped envelope
sufficient to cover postage,
except those relating to the
cargo of the aircraft, and that
there was delivery to the
proper foreign port of all
mails placed on board said
aircraft before clearance from
the Philippines.
If an aircraft is cleared to
depart without passengers,
the aircraft shall not carry any
passenger thereon.

A record shall be made and

kept open to public inspection
in every customs office at an
airport of entry of the dates of
arrival and entry of all aircraft.

CHAPTER 3

OTHER THIRD PARTIES

Sec. 1226. Supervision and

Regulation of Third Parties. –
Third parties transacting with
the Bureau on behalf of
importers and consignees
shall be treated equally as
true importers or consignees.

Third parties transacting with

the Bureau shall be liable for
acts committed in violation of
this Act and related laws.

Upon the recommendation of

the Commissioner, the
Secretary of Finance shall
issue rules and regulations to
govern and regulate the
conduct of all third parties
dealing directly with

the Bureau in relation to the

importation, exportation,
movement, storage and
clearance of goods for and
on behalf of another person.
The rules and regulations
shall provide for specific
conditions when third parties
may or may not directly
transact with the Bureau and
shall provide a written notice
in case such third parties are,
for valid reasons, barred from
transacting with the Bureau.
Third party is defined under
Section 102(uu) of this Act.
For purposes of this section,
third parties may also refer to
logistics providers; importers,
exporters, carriers, airlines,
shipping lines, shipping
agents, forwarders,
consolidators, port and
terminal operators, and
warehouse operators, if such
persons or entities transacted
with the Bureau.

CHAPTER 4

AUTHORIZED ECONOMIC
OPERATORS (AEOs)

Sec. 1227. Treatment of

Authorized Economic
Operators (AEOs). – The
Bureau shall promulgate the
necessary procedures and
requirements for the
compliance of Authorized
Economic Operators (AEOs).
For AEOs who have
displayed diligence in
complying with the rules and
the submission of official
customs requirements, and
have satisfactorily managed
their commercial records, the
Bureau shall extend the
following incentives:

(a) Release of the goods

upon provision of the
minimum information
necessary to identify the
goods and permit the
subsequent completion of the
final goods declaration;

(b) Grant of clearance of the

goods at the declarant's
premises or another place
authorized by the Bureau;
and

(c) Other special procedures

such as:

(i) Allowing a single goods

declaration for all imports or
exports in a given period
where goods are imported or
exported frequently by the
same person;

(ii) Use of commercial

records to self-assess their
duty and tax liability and,
where appropriate, to ensure
compliance with other
customs requirements; and

(iii) Allowing the lodgement of

goods declaration by means
of an entry in the records by
the authorized person to be
supported subsequently by a
supplementary goods
declaration.
Sec. 1228. Trade Facility for
AEO. – The Secretary of
Finance shall, upon the
recommendation of the
Commissioner, issue the
necessary rules:

(a) To supervise and regulate

the conduct and operations of
the AEO s, consistent with
international best practices,
the World Customs
Organization (WCO)
framework of standards to
secure and facilitate global
trade, and other international
conventions and agreements;

(b) To develop a trade

facilitation program for AEOs
and other authorized persons
consistent with international
best practices and
international conventions and
agreements; and

(c) To recognize existing

facilities where the authority
or right to operate AEOs has
been granted by the relevant
government agency or
regulator through a contract,
where the Bureau shall:

(i) Only require an

endorsement by the relevant
agency or regulator;

(ii) Issue a certificate of

authority as a matter of
course; and
(iii) Ensure that the term of
the certificate of authority
shall be coterminous with the
applicable government
contract or any extension
thereof.

The Bureau shall implement

the provisions of this chapter
without interfering, or
impeding AEO operations as
well as existing operations of
wharves, container yards,
container freight stations,
warehouses, examination
areas and other facilities
located in customs territory
and/or in airports and
seaports. The Bureau shall
likewise ensure that any
subsequent rules,
regulations, orders or
memoranda issued in relation
to AEOs shall be consistent
with the appropriate
government agency's or
regulator's prevailing
operating procedures and
international hest practices.

Existing contracts of private

operators with appropriate
government agency or
regulator, such as, but not
limited to, the PPA, SBMA.
and PIA and their respective
authorities and powers
already granted by law
pertinent to such contract,
shall not be impaired or
adversely affected with the

"Sec. 1301. Persons
Authorized to Make Import
Entry. — Imported articles
must be entered in the
customhouse at the port of
entry within thirty (30) days,
which shall not be extendible,
from the date of discharge of
the last package from the
vessel or aircraft either (a) by
the importer, being holder of
the bill of lading, (b) by a duly
licensed customs broker
acting under authority from a
holder of the bill or (c) by a
person duly empowered to
act as agent or attorney-in-
fact for each holder:
Provided, That where the
entry is filed by a party other
than the importer, said
importer shall himself be
Bureau's implementing rules
and regulations on AEOs.
TITLE XIII
CUSTOMS FEES AND
CHARGES
Sec. 1300. Customs Dues,
Fees and Charges. – For
services rendered and
documents issued by the
Bureau, dues, fees and
charges shall be collected as
may be provided under
existing regulations issued by
the Secretary of Finance,
upon the recommendation of
the Commissioner.
Sec. 1301. General Provision
on the Authority to Increase
or Decrease Dues, Fees and
Charges. –The Secretary of
Finance may, upon the
recommendation of the
Commissioner, increase or
decrease the dues, fees and
charges collectible by the
Bureau to protect the interest
of the government.
TITLE XIV
OFFENSES AND
PENALTIES
CHAPTER 1
CRIMES AND OTHER
OFFENSES
required to declare under
oath and under the penalties
of falsification or perjury that
the declarations and
statements contained in the
entry are true and correct:
Provided, further, That such
statements under oath shall
constitute prima facie
evidence of knowledge and
consent of the importer of
violations against applicable
provisions of this Code when
the importation is found to be
unlawful."chan robles virtual
law
Sec. 1400. Misdeclaration,
Misclassification,
Undervaluation, in Goods
Declaration. – Misdeclaration
as to quantity, quality,
description, weight, or
measurement of the goods,
or misclassification through
insufficient or wrong
description of the goods or
use of wrong tariff heading
resulting to a discrepancy in
duty and tax to be paid
between what is legally
determined upon assessment
and what is declared, shall be
subject to a surcharge
equivalent to two hundred
fifty percent (250%) of the
duty and tax due. No
surcharge shall be imposed
when the discrepancy in duty
is less than ten percent
(10%), or when the declared
tariff heading is rejected in a
formal customs dispute
settlement process involving
difficult or highly technical
question of tariff
classification, or when the
tariff classification declaration
relied on an official
government ruling.
There is undervaluation
when: (a) the declared value
fails to disclose in full the
price actually paid or payable
or any dutiable adjustment to
the price actually paid or
payable; or (b) when an
incorrect valuation method is
used or the valuation rules
are not properly observed,
resulting in a discrepancy in
duty and tax to be paid
between what is legally
determined as the correct
value against the declared
value. When the
undervaluation is established
without the need to go
through the formal dispute
settlement process provided
for in this Act, a surcharge
shall be imposed equivalent
to two hundred fifty percent
(250%) of the duty and tax
due. No surcharge shall be
imposed when the
discrepancy in duly is less
than ten percent (10%); or
the declared value is rejected
as a result of an official ruling
or decision under the
customs dispute settlement
process involving difficult or
highly technical question
relating to the application of
customs valuation rules.

A discrepancy in duty and tax

to be paid between what is
legally determined and what
is declared amounting to
more than thirty percent
(30%) shall constitute a prima
facie evidence of fraud.

When the misdeclaration,

misclassification or
undervaluation is intentional
or fraudulent, such as when a
false or altered document is
submitted or when false
statements or information are
knowingly made, a surcharge
shall be imposed equivalent
to five hundred percent
(500%) of the duty and tax
due and that the goods shall
be subject to seizure
regardless of the amount of
the discrepancy without
prejudice to the application of
fines or penalties provided
under Section 1401 of this
Act against the importer and
other person or persons who
willfully participated in the
fraudulent act.

Sec. 1401. Unlawful

Importation or Exportation. –
Any person who shall
fraudulently import or export
or bring into or outside of the
Philippines any goods, or
assist in so doing, contrary to
law, or shall receive, conceal,
buy, sell, or in any manner
facilitate the transportation,
concealment, or sale of such
goods after importation, or
shall commit technical
smuggling as defined in this
Act shall be penalized by:

(a) Imprisonment of not less

than thirty (30) days and one
(1) day but not more than six
(6) months, or a fine of not
less than twenty-five
thousand pesos (P25,000.00)
but not more than seventy-
five thousand pesos
(P75,000.00), or both, if the
appraised value of the goods
unlawfully imported, to be
determined in the manner
prescribed under this Act,
including duties and taxes, of
the goods unlawfully
imported does not exceed
two hundred fifty thousand
pesos (P250,000.00);

(b) Imprisonment of not less

than six (6) months and one
(1) day but not more than one
(1) year, or a fine of not less
than seventy-five thousand
pesos (P75,000.00) but not
more than one hundred fifty
thousand pesos
(P150,000.00), or both, if the
appraised value of the goods
unlawfully imported, to be
determined in the manner
prescribed under this Act,
including duties and taxes,
exceeds two hundred fifty
thousand pesos
(P250,000.00) but not more
than five hundred thousand
pesos (P500,000.00);

(c) Imprisonment of not less

than one (1) year and one (1)
day but not more than three
(3) years, or a fine of not less
than one hundred fifty
thousand pesos
(P150,000.00) but not more
than three hundred thousand
pesos (P300,000.00) or both,
if the appraised value of the
goods unlawfully imported, to
be determined in the manner
prescribed under this Act,
including duties and taxes,
exceeds five hundred
thousand pesos
(P500,000.00) but not more
than one million pesos (P
1,000,000.00);

(d) Imprisonment of not less

than three (3) years and one
(1) day but not more than six
(6) years, or a fine of not less
than three hundred thousand
pesos (P300,000.00) but not
more than one million five
hundred thousand pesos (P
1,500,000.00), or both, if the
appraised value of the goods
unlawfully imported, to be
determined in the manner
prescribed under this Act,
including duties and taxes,
exceeds one million pesos
(P1,000,000.00) but not more
than five million pesos
(P5,000,0 00.00);

(e) Imprisonment of not less

than six (6) years and one (1)
day but not more than twelve
(12) years, or a fine of not
less than one million five
hundred thousand pesos (P
1,500,000.00) but not more
than fifteen million pesos
(P15,000,000.00), or both, if
the appraised value of the
goods unlawfully imported, to
be determined in the manner
prescribed under this Act,
including duties and taxes,
exceeds five million pesos
(P5,000,000.00) but not more
than fifty million pesos
(P50,000,000.00);

(f) Imprisonment of not less

than twelve (12) years and
one (1) day but not more than
twenty (20) years, or a fine of
not less than fifteen mill-inn
pesos (P15,000,000.00) but
not more than fifty million
pesos (P50,000,000.00), or
both, if the appraised value of
the goods unlawfully
imported, to be determined in
the manner prescribed under
this Act, including duties and
taxes, exceeds fifty million
pesos (P50,000,000.00) but
not more than two hundred
million pesos
(P200,000,000.00);

(g) If the appraised value of

the goods unlawfully
imported to be determined in
the manner prescribed under
this Act, including duties and
taxes, exceeds two hundred
million pesos
(P200,000,000.00) or if the
aggregate amount of the
appraised value of the goods
which are the subject of
unlawful importation
committed in more than one
instance, including duties and
taxes, exceeds two hundred
million pesos
(P200,000,000.00), the same
shall be deemed as a
heinous crime and shall be
punishable with a penalty of
reclusion perpetua and a fine
of not less than fifty million
pesos (P50,000,000.00); and

(h) The penalty of prision

mayor shall be imposed
when the crime of serious
physical injuries shall have
been committed, and the
penalty of reclusion perpetua
shall be imposed when the
crime of homicide shall have
been committed by reason or
on the occasion of the
unlawful importation.

In applying the above scale

of penalties, an offender who
is a foreigner shall be
deported without further
proceedings after serving the
sentence. If the offender is a
public officer or employee,
the penalty which is the next
higher in degree shall be
imposed in addition to the
penalty of perpetual
disqualification from public
office, and disqualification to
vote and to participate in any
public election. If the offender
fails to pay the fine,
subsidiary imprisonment shall
be served.

When, upon trial for violation

of this section, the defendant
is shown to have had
possession of the goods in
question, possession shall be
deemed sufficient evidence
to authorize conviction unless
the defendant shall explain
the possession to the
satisfaction of the court:
Provided, That each act of
unlawful importation or
exportation shall be deemed
as a separate offense:
Provided, however, That
payment of the tax due after
apprehension shall not
constitute a valid defense in
any prosecution, under this
section: Provided, further,
That outright smuggling shall
also be punishable under this
section: Provided, finally,
That the rights and privileges
provided in this Act for the
importers, consignees,
exporters, service providers,
third parties and other third
parties who committed this
offense shall be revoked.

Sec. 1402. Failure or Refusal

of Party to Give Evidence or
Submit Documents for
Assessment. – When the
owner, importer or consignee
of any imported goods, or the
agent of either, fails or
refuses, upon lawful demand
in writing by any customs
officer to appear, lawfully
depose, or submit to
examination or to answer any
material question or refuses
to produce records, accounts
or invoices in possession
pertaining to the value,
classification or disposition of
the goods in question and
deemed material in
assessing the same, the
District Collector shall assess
a surcharge of twenty percent
(20%) on the dutiable value
of the goods which is the
subject of the importation.

Sec. 1403. Other Fraudulent

Practices Against Customs
Revenue. – Any person who
makes or attempts to make
any entry of imported or
exported goods by means of
any false or fraudulent
statement, document or
practice or knowingly and
willfully files any false or
fraudulent claim for payment
of drawback or refund of
duties shall, for each act, be
punished in accordance with
the penalties prescribed in
Section 1401 of this Act.

Sec. 1404. Failure to Declare

Baggage. – Whenever
dutiable goods are not
declared by any person
arriving within the Philippines,
such goods shall be seized
and the person may obtain
release of such goods, if not
imported contrary to any law,
upon payment of a surcharge
equivalent to thirty percent
(30%) of the landed cost of
such goods, in addition to all
duties, taxes and other
charges due. Nothing in this
section shall preclude the
filing of criminal action
against the offender.

Sec. 1405. Vessel, Seacraft,

or Aircraft Departing Before
Undergoing Customs
Formalities. – Any vessel,
seacraft, or aircraft arriving
within the limits of a Customs
District from a foreign port
which departs before
undergoing customs
formalities, without being
compelled to do so by stress
of weather, pursuit or duress
of enemies, or other
necessity, shall be liable for a
fine of not less than one
hundred thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00).

Sec. 1406. Obstruction to

Boarding Officer. – If the
master or pilot-in-command
or any member of the
complement of any vessel or
aircraft arriving at the
Philippine port obstructs or
hinders any officer from
lawfully going on board such
vessel or aircraft for the
purpose of enforcing this Act,
or intentionally causes any
officer to be so obstructed or
hindered, the vessel or
aircraft shall be liable to a
fine of not less than one
hundred thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00).

Sec. 1407. Unlawful Boarding

or Leaving of Vessel or
Aircraft. – If, upon arrival at
the Philippine port, any
master of a vessel or pilot-in-
command of an aircraft
engaged in a foreign trade
permits any person to board
or leave the vessel or aircraft
without the permission of the
customs officer-in-charge, the
owner or operator of such
vessel or aircraft shall he
liable for a fine of not less
than one hundred thousand
pesos (100,000.00) but not
more than three hundred
thousand pesos
(P300,000.00).

Sec. 1408. Unloading of

Cargo Before Arrival at Port
of Entry. – If, upon the arrival
within the limits of any
Customs District of the
Philippines of any vessel or
aircraft engaged in foreign
trade, the master or pilot-in-
command thereof permits
any part of the cargo to be
unloaded before arrival at the
port of entry, and without
authority from a proper
customs officer, the owner,
operator, or agent of such
vessel or aircraft shall he
liable for a fine of not less five
hundred thousand pesos
(P500,000.00) but not more
than two million pesos
(P2,000,000.00): Provided,
That no fine shall accrue
upon satisfactory proof to the
proper District Collector that
the unloading was rendered
necessary by stress of
weather, accident or other
necessity: Provided,
however, That the fine
imposed herein shall be
without prejudice to the
application of fines or
penalties provided under
Section 1401 of this Act.

Sec. 1409. Unloading of

Cargo at Improper Time or
Place After Arrival. – The
owner or operator of any
vessel or aircraft from which
cargo is discharged upon
arrival in the Philippines at a
time or place other than that
designated by the District
Collector, shall be fined not
less one hundred thousand
pesos (P100,000.00) but not
more than three hundred
thousand pesos
(P300,000.00): Provided,
That no fine shall accrue
upon satisfactory proof to the
proper District Collector that
the unloading was rendered
necessary by stress of
weather, accident or other
necessity.

Sec. 1410. Failure to Exhibit

or Deposit Documents. –
When the master of a vessel
or pilot-in-command of an
aircraft engaged in foreign
trade fails to submit to the
District Collector at the time
of entry of the vessel or
aircraft the register or other
documents in lieu thereof,
together with the clearance
and other documents granted
by the customs officers to the
vessel or aircraft at the last
foreign port of departure, or
fails to exhibit any certificate
or other documents required
to be then exhibited, the
owner or operator of such
vessel or aircraft shall be
liable for a fine of not less
than one hundred thousand
pesos (P100.000.00) but not
more than three hundred
thousand pesos
(P300,000.00).

Sec. 1411. Bringing of

Unmanifested Arms,
Explosives or War
Equipment. – The owner,
operator, or agent of a vessel
or aircraft arriving at a port in
the Philippines bearing cargo
consisting of firearms,
gunpowder, cartridges,
dynamite or any other
explosives, munitions or
equipment of war not
contained in the manifest of
the vessel or aircraft, or
which are concealed on
board, shall be liable for a
fine of not less than five
hundred thousand pesos
(P500,000.00) but not more
than one million pesos
(P1,000,000.00).

Sec. 1412. Failure to Supply

Advance and Requisite
Manifests. – Failure to
transmit the electronic
manifest within the required
time as may be prescribed by
the Bureau, prior to arrival of
the carrying vessel or aircraft
at the port of entry shall make
the owner, operator, or agent
of the vessel or aircraft liable
for a fine of not less than one
hundred thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00).

If the transit time from port of

origin to port of entry is at
least seventy-two (72) hours,
the shipping or forwarding
agent of the carrier or the
vessel who fails to submit the
manifest at least twenty-four
(24) hours before entry shall
likewise be liable for a fine of
not less than one hundred
thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00).

Sec. 1413. Disappearance of

Manifested Goods. – When
any package or goods
mentioned in the manifest
meant to be unloaded at the
port of destination is not
unloaded upon the arrival of
the vessel or aircraft, its
agent shall be liable for a fine
of not less than one hundred
thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00) unless
the disappearance of the
package or the goods in
question was not due to the
negligence of the master of
the vessel or pilot-in-
command of an aircraft, and
is explained to the
satisfaction of the District
Collector.

The owner, operator, or

agent of a vessel or aircraft
shall be liable for the
payment of the same fine
when a package or goods
listed in the manifest does
not tally materially in
character or otherwise with
the description thereof in the
manifest.

Sec. 1414. Discrepancy

Between Actual and Declared
Weight of Manifested Goods.
– If the gross weight of goods
or package described in the
manifest or bill of lading
exceeds the declared weight
by more than ten percent
(10%), and such discrepancy
was due to the negligence of
the master or pilot-in-
command, the owner,
employee, operator or agent
of the importing vessel or
aircraft shall be liable for a
fine of not more than twenty
percent (20%) of the value of
the package or goods in
respect to which the
deficiency exists.

Sec. 1415. Discrepancy With

the Master's or Pilot's-in-
Command Report. – When a
vessel or aircraft arriving from
a foreign port is compelled by
necessity to unload in
another port other than the
port of entry and permission
is granted by the District
Collector for the unloading of
the vessel or aircraft or the
delivery of any part of the
cargo and it shall be found
that there is discrepancy
between the cargo unloaded
and the report of the master
or the pilot-in-command and
such discrepancy is not
satisfactorily explained, the
owner, operator or agent of
the vessel or aircraft shall be
liable for a fine of not less
than one hundred thousand
pesos (P100,000.00) but not
more than three hundred
thousand pesos
(P300,000.00).

Sec. 1416. Failure to Report

Fraud. – A master, pilot-in-
command or other officer,
owner or agent of any vessel
or aircraft trading with or
within the Philippines who
has knowledge of the
commission of fraud that
shall result in the loss or
diminution of customs
revenue but fails to report all
information relative thereto to
the Distract Collector shall be
penalized with imprisonment
of not less than six (6)
months and one (1) day but
not more than one (1) year
and shall be liable for a fine
of not less than one hundred
thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00). If the
offender is a foreigner, the
offender shall be deported
after serving the sentence. If
the offender is a public officer
or employee, the offender
shall suffer additional penalty
of perpetual disqualification
to hold public office, to vote
and to participate in any
election. All the benefits due
from service in the
government, including the
separation and retirement
benefits, shall be forfeited.

Sec. 1417. False Statement

of Vessel's or Aircraft's
Destination. – When the
master or pilot-in-command
of a vessel or aircraft loaded
with goods shall make a false
statement as to the next
destination of such vessel or
aircraft when that information
is required by a customs
officer, the owner or operator
of such vessel or aircraft shall
be liable for a fine of not less
than one hundred thousand
pesos (P100,000.00) but not
more than three hundred
thousand pesos
(P300,000.00). The arrival of
a vessel or aircraft at a
different port other than the
one it had been originally
authorized and cleared for
without having been impelled
to do so by necessity, shall
be prima facie proof that the
original statement of the
actual destination of the
vessel or aircraft was false.

Sec. 1418. Affixing Seals. –

Any person who, without
authority, affixes or attaches
a customs seal, fastening, or
any mark, or fastening
purporting to be a customs
seal, to any vessel, aircraft,
vehicle, warehouse, or
package, shall be penalized
with imprisonment of not less
than six (6) months and one
(1) day but not more than one
(1) year, and shall be liable
for a fine of not less than one
hundred thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00). If the
offender is a foreigner, the
offender shall be deported
after serving the sentence. If
the offender is a public officer
or employee, the offender
shall suffer an additional
penalty of perpetual
disqualification to hold public
office and disqualification
from exercising the right to
vote and to participate in any
election.

Sec. 1419. Breaking of Seal

Placed by Customs Officers.
– If any seal placed by a
customs officer upon any
vessel or aircraft or
compartment thereof, or upon
any box, trunk or other
package of goods on board is
broken, the owner, operator,
or agent of the vessel or
aircraft shall be liable for a
fine of not less than one
hundred thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00) for each
broken or destroyed seal.

Sec. 1420. Breaking of Lock

or Fastening Placed by
Customs Officers. – If any
lock or other fastening device
placed by a customs officer
upon any hatch door, or other
means of communication in
the hold of a vessel or
aircraft, or other part thereof
for the security of the same
during the night time, is
unlawfully opened, broken or
removed, or if any of the
goods contained in the hold
or in the other compartments
so secured is clandestinely
abstracted and landed, the
owner, operator, or agent of
the vessel or aircraft shall be
liable for a fine of not less
than one hundred thousand
pesos (P100,000.00) but not
more than three hundred
thousand pesos
(P300.000.00).

Sec. 1421. Removal,

Breakage, and Alteration of
Marks. – Any person who,
without authority, willfully
removes, breaks, injures,
defaces or alters any
customs seal or other
fastening or mark placed
upon any vessel, vehicle, on
land, sea or air, warehouse
or package containing
merchandise or baggage in
bond or in customs custody,
shall be punished with the
penalty prescribed in Section
1420 hereof.

Sec. 1422. Unauthorized

Withdrawal of Imported
Goods from Bonded
Warehouse. – Any person
who causes the unauthorized
withdrawal of imported goods
stored from a CBW shall be
liable for payment of a
surcharge of fifty percent
(50%) of duties, taxes,
customs fees, and charges,
found to be due and unpaid.
The amount of surcharge
shall be added to the duties,
taxes and charges due on the
goods withdrawn. If the
delinquency lasts for more
than one (1) year, the
surcharge shall be increased
by twenty-five percent (25%)
of the unpaid duties and
taxes annually: Provided,
That where the withdrawal is
attended with fraud, such as
when a fake or altered
withdrawal permit is
submitted, the warehouse
operator shall be held liable
under the pertinent provisions
of this Act, without prejudice
to the suspension or
revocation of the
warehousing privileges
granted by the Bureau
pursuant to this Act.

Sec. 1423. Removing or

Repacking Goods in
Warehouse. – Any person
who fraudulently conceals,
removes, or repacks
merchandise in any
warehouse or fraudulently
alters, defaces, or obliterates
any mark or numbers placed
upon packages deposited in
such warehouse, or shall aid
or abet any such acts, shall
be punished with the
penalties prescribed in
Section 1418 hereof.

Merchandise so concealed,
removed, or repacked, or
packages upon which marks,
numbers or the values
thereof have been so altered,
defaced, or obliterated shall
be forfeited in favor of the
government.

Sec. 1424. Removing Goods

from Customs Custody. –
Any person who enters any
warehouse, or any vehicle
loaded with or containing
merchandise with intent to
unlawfully remove therefrom
any merchandise or baggage
in such vessel, vehicle or
warehouse or otherwise in
customs custody or control,
or any person who receives
or transports any
merchandise or baggage
unlawfully removed from any
such vessel, vehicle or
warehouse, or shall aid or
abet such removal, shall
suffer the penalties provided
in Section 1401 hereof.

Sec. 1425. Failure to Pay

Duties, Taxes and Other
Charges. – For failure to pay
the duties, taxes and other
charges of an assessment
within fifteen (15) days from
the date of final assessment,
a surcharge of ten percent
(10%) of the total assessed
amount or balance thereon
shall be added and collected,
which surcharge shall be
increased to twenty-five
percent (25%) if the
delinquency lasts for more
than one (1) year.
Sec. 1426. Breach of
Security. – Upon breach of
security require d to be filed
under this Act, the District
Collector, subject to the
approval of the
Commissioner, may accept in
satisfaction thereof a smaller
stun than that mentioned in
the penalty clause of the
security, but in no case less
than the amount necessary to
indemnify the government for
the damage occasioned by
such breach.

Sec. 1427. Failure to Keep

Importation Records and Full
Access to Customs Officers.
– Any person who fails to
keep all the records of
importations or books of
accounts, business and
computer systems and all
customs commercial data in
the manner prescribed under
this Act, shall be punished
with imprisonment of not less
than three (3) years and one
(1) day but not more than six
(6) years and/or a fine of one
million pesos (Pl,000,000.00).
This penalty shall likewise be
imposed against importers
and brokers who deny an
authorized customs officer
full and free access to such
records, books of accounts,
business and computer
systems, and all customs
commercial data including
payment records, without
prejudice to the imposition of
the administrative sanctions
by the Bureau against
contumacious importers,
including the authority to hold
delivery or release of their
imported goods.

Sec. 1428. Concealment or

Destruction of Evidence of
Fraud. – Any person who
willfully conceals or destroys
any invoice, book, or
document relating to any
goods liable to duty after an
inspection thereof has been
demanded by the District
Collector or at any time
conceals or destroys any
such invoice, book, or
document for the purpose of
suppressing any evidence of
fraud therein contained, shall
be penalized with
imprisonment of not less than
three (3) years and one (1)
day but not more than six (6)
years and shall be liable for a
fine of not less than three
hundred thousand pesos
(P300,000.00) but not more
than one million pesos
(P1,000,000.00).

Sec. 1429. Other Offenses. –

The owner or operator of a
vessel, aircraft or train shall
be liable for a fine for the
following acts:

(a) For anchoring at any

dock, pier, wharf, quay, or
bulkhead other than a port of
entry, a fine of not less than
five hundred thousand pesos
(P500,000.00) but not more
than one million pesos
(P1,000,000.00) for overseas
vessels;

(b) For dumping of garbage

or slops over the sides of the
vessel within three (3) miles
from the nearest coastline, a
fine of not less than one
million pesos
(P1,000,000.00) but not more
than ten million pesos
(P10,000,000.00);

(c) For dumping or causing to

spread crude oil, kerosene,
or gasoline in the bay or at
the piers within three (3)
miles from the nearest
coastline, a fine of not less
than one million pesos
(P1,000,000.00) but not more
than ten million pesos (P
10,000,000.00) for each
offense;

(d) For loading gasoline or

any other petroleum products
at a place other than that
designated, by the
regulations, a fine of not less
than five hundred thousand
pesos (P500,000.00) but not
more than one million pesos
(P1,000,000.00) for each
offense;
(e) For causing the emission
and spread of harmful gas,
fumes and chemicals, a fine
of not less than one million
pesos (P1,000,000.00) but
not more than ten million
pesos (P10,000,000.00) for
each offense; and

(f) For transporting

hazardous waste, radioactive
waste and other toxic
substances as provided
under the Basel Convention
and Republic Act No. 6969,
otherwise known as the
"Toxic Substances and
Hazardous and Nuclear
Wastes Control Act of 1990",
the penalty shall be forfeiture
of the vessel in favor of the
government.

The fines imposed herein

shall be without prejudice to
the application of fines or
penalties provided under
special laws and regulations.

Sec. 1430. Violations of this

Act and Rules and
Regulations in General. –
Any person who violates any
other provision of this Act or
the rules and regulations
issued pursuant thereto, shall
be penalized with
imprisonment of not less than
thirty (30) days and one (1)
day but not more than one (1)
year, or be liable for a fine of
not less than one hundred
thousand pesos
(P100,000.00) but not more
than three hundred thousand
pesos (P300,000.00), or
both. If the offender is a
foreigner, the offender shall
be deported after serving the
sentence. If the offender is a
public officer or employee,
the offender shall be
disqualified from holding
public office, from exercising
the right to vote and to
participate in any public
election for ten (10) years.

CHAPTER 2

PENALTIES IMPOSED
UPON BUREAU
EMPLOYEES

Sec. 1431. Statutory

Offenses of Officers and
Employees. – Every officer,
agent, or employee of the
Bureau or of any other
agency of the government
charged with the enforcement
of the provisions of this Act,
who shall be found guilty of
any delinquency as described
below shall be penalized with
imprisonment of not less than
six (6) years and one (1) day
but not more than twelve (12)
years, and perpetual
disqualification to hold public
office, from exercising the
right to vote and to participate
in any public election and a
fine of not less than five
hundred thousand pesos
(P500,000.00), but not more
than one million pesos
(P1,000,000.00):

(a) Extortion or willful

oppression under color of
law;

(b) Knowingly demanding

other or greater sums that
are authorized by law or
receive any fee,
compensation, or reward
except as by law prescribed,
for the performance of any
duty;

(c) Willfully neglecting to give

receipts, as required by law,
for any sum collected in the
performance of duty, or who
willfully neglect to perform
any of the duties enjoined
bylaw;

(d) Conspiring or colluding

with another or others to
defraud the customs revenue
or otherwise violate the law;

(e) Providing an opportunity

for any person to defraud the
government of customs
revenue or failing to do any
act with the intent to enable
any person to defraud the
government of customs
revenue;
(f) Negligently or designedly
permitting the violation of the
law by any other person;

(g) Making or signing for any

false entry or entries in any
book, making or signing any
false certificate or return in
any case where the law
requires the making by them
of such entry certificate or
return;

(h) Failing to report

knowledge or information to
their superior officer about an
act or acts of fraud committed
in revenue collection as
required by law;

(i) Demanding or accepting or

attempting, without authority,
to collect directly or indirectly
as payment or otherwise, any
sum of money or other thing
of value for the compromise,
adjustment, or settlement of
any charge or complaint for
any violation or alleged
violation of law;

(j) Unlawfully disclosing

confidential information
gained during any
investigation or audit, or
using such information for
personal gain or to the
detriment of the government,
the Bureau, or third parties.

All the benefits due from

service in the government,
including separation and
retirement benefits, of an
officer, agent, or employee of
the Bureau or of any other
agency of the government
charged with the enforcement
of the provisions of this Act
found guilty of the foregoing
violations shall be forfeited.

Sec. 1432. Failure to Report

Fraud. – Any employee of the
Bureau who has knowledge
of any fraud committed
against the government
pertaining to customs
revenue, and who fails to
report all information relative
thereto to the District
Collector, shall be penalized
with imprisonment of not less
than six (6) years and one (1)
day but not more than twelve
(12) years and a fine of not
less than five hundred
thousand pesos
(P500,000.00) but not more
than one million pesos
(1,000,000.00). The offender
shall suffer the additional
penalty of perpetual
disqualification to hold public
office, to vote and to
participate in any election. All
the benefits of the offender
due from service in the
government, including
separation and retirement
benefits, shall be forfeited.

Sec. 1433. Liability for Other

Offenses. – The fines and
penalties imposed in this
chapter shall be without
prejudice to the application of
fines or penalties provided
under Chapter 1 of this title
and special laws and
regulations.

TITLE XV

MISCELLANEOUS
PROVISIONS

Sec. 1500. Information,

Decisions, and Rulings. –
The Bureau shall ensure that
all information of general
application pertaining to
customs, including revisions
or amendments thereto, shall
be available to the general
public.

Sec. 1501. Period to Issue

Ruling. – Unless otherwise
provided in this Act, the
issuing authority shall act on
the application for ruling
within thirty (30) days from
receipt of the application and
supporting documents as
may be required by
regulation. Within three (3)
days from issuance of a
ruling, the issuing authority
shall notify the requesting
party of such ruling.

Sec. 1502. Publication and

Confidentiality of Certain
Information in Ruling – The
Bureau and the Commission
shall regularly publish its
rulings in a manner
accessible to the public. For
this purpose, each
application for ruling shall be
assigned a title and unique
ruling number for easy
reference. The publication
shall contain information on
the goods involved, the body
or summary of the ruling,
particularly the grounds relied
upon to support the ruling,
but shall exclude the name of
the requesting party and
other information which by
their very nature are
confidential, including those
which the requesting party
indicated in its application as
confidential in nature. Except
in the context of judicial
proceedings, any disclosure
of confidential information
under this section shall not
be made except upon the
written consent of the
beneficiary of the advance
ruling.

Sec. 1503. Duty of District

Collector to Report Rulings to
the Commissioner. – When
any new or unsettled
question shall be determined
by a District Collector, and if
the matter is not otherwise
appealed for review in the
ordinary course, the District
Collector shall notify the
Commissioner of the decision
and submit an adequate
statement of the facts
involved.

Sec. 1504. Application of

Established Ruling or
Decision. – A ruling or
decision of the Commissioner
which determines the
construction or application of
any provision of law imposing
customs duties and taxes,
and which changes any
existing established
valuation, classification, rules
of origin and other customs
rules, interpretation or
practice shall not take effect
until thirty (30) days after
public notice shall have been
given in the form of a
published decision. When the
ruling or decision favors the
taxpayers, it shall become
effective immediately.

Sec. 1505. Authority of

Official to Administer Oaths
and Take Testimony. – The
Commissioner, District
Collectors and their deputies,
and other customs officers
especially deputized by the
District Collector shall have
authority to administer oaths
and take testimony in
connection with any matter
within the jurisdiction of the
Bureau and, in connection
therewith, may require the
production of relevant
papers, documents, books
and records in accordance
with law.

Sec. 1506. General Security.

– In cases where securities
are required to be given
under the provisions of this
Act and related customs
laws, the District Collector,
instead of requiring separate
special security where
transactions of a particular
party are numerous, may
accept general security
extending over such periods
of time and covering such
transactions of the party in
question as may be
satisfactory to the District
Collector.

Sec. 1507. Security. – The

Bureau shall prescribe the
forms and amount of security
required to guarantee the
payment of duties and taxes
and other obligations
provided for in this Act.

Any party required to provide

security shall have the option
to choose from any form of
security prescribed by the
Bureau. The Bureau may not
require security if satisfied
that an obligation to the
Bureau will be fulfilled, but
shall require and accept a
general security from
declarants who regularly
declare goods at different
offices in customs territory
under such terms and
conditions as maybe
determined by the
Commissioner.

The required amount of

security shall be the lowest
possible and shall not exceed
the amount of imposable
duties, taxes and other
charges.

When the obligation under

which the security was
required has been satisfied,
the security shall be
discharged immediately.

Sec. 1508. Customs Service

Fees. – Customs personnel
may be assigned by a District
Collector to render overtime
work and other customs
services and shall be paid for
such services by the Bureau,
according to service fees
fixed by the Commissioner
and approved by the
Secretary of Finance. The
Bureau may charge
additional customs service
fees when applicable, subject
to the rates prescribed under
existing rules and
regulations.

Sec. 1509. Testimony in

Writing. – When testimony is
taken in any proceeding or
matter under the authority of
the Bureau, either party may
require that the testimony
shall be made in writing, and
when so taken, the written
testimony shall be filed with
the Office of the District
Collector and to be preserved
for use or reference until the
final decision has been
reached.

Sec. 1510. District Collector

Not Liable in Respect to
Ruling in Customs Cases. –
Every District Collector or
other officials of the Bureau
shall not be in any way
personally liable on account
of any official ruling or
decision as to which the
person claiming to be
aggrieved has the right to
obtain either an
administrative or judicial
review. Except for
misdelivery of goods, a
District Collector may not, in
the absence of abuse of
authority, be liable to any
person for any loss
occasioned either by the
official act or the acts of the
subordinates.

Sec. 1511. Interest Prohibited

to be Held by Customs
Employees. – Any person
employed under the authority
of the government in the
assessment of duties, taxes,
fees and other charges in
connection with imports or
exports, shall not own, either
in whole or in part, any vessel
or aircraft or act as attorney,
agent or consignee for the
owner of any vessel or
aircraft or of any cargo
loaded on board the vessel or
aircraft; and shall not import
or be involved, directly or
indirectly, in the importation
of any goods for sale into the
Philippines.

Sec. 1512. Reward to

Persons Instrumental in the
Actual Collection of
Additional Revenues Arising
from the Discovery of
Violations of this Act. – A
cash reward equivalent to
twenty percent (20%) of the
actual proceeds from the sale
of smuggled goods and
confiscated goods or actual
collection of additional
revenues shall be given to
the customs and non-
customs informers or
whistleblowers who are
instrumental in the collection
of additional revenues arising
from the discovery of
violations of this Act in
accordance with the rules
and regulations to be issued
by the Secretary of Finance.

Sec. 1513. Outsourcing of

Non-Sovereign Customs
Functions to Private Entities.
– Subject to the approval of
the Secretary of Finance, the
Bureau may outsource any of
its non-sovereign and
ancillary function to a
qualified and competent
private entity in accordance
with, government rules on
service procurement.

Sec. 1514. International

Standards and Best
Practices. – The Bureau may
adopt international standards
and best practices in customs
administration laid down by
international agreement or
convention pertaining to trade
facilitation, supply chain
security, and related matters,
whether or not the Philippines
is a signatory to such
international agreement or
convention.

TITLE XVI

TARIFF ADMINISTRATION
AMD POLICY

CHAPTER I

TARIFF COMMISSION

Sec. 1600. Chief Officials of

the Tariff Commission and
Qualifications. – The officials
of the Tariff Commission shall
consist of a Chairperson and
two (2) Commissioners to be
appointed by the President of
the Philippines. The
Chairperson and the
Commissioners shall be
natural-born citizens of the
Philippines, of good moral
character and proven
integrity, and who, by
experience and academic
training possess the
necessary qualifications
requisite for developing
expert knowledge of tariff and
trade related matters. During
their terms of office, the
Chairperson and the
Commissioners shall not
engage in the practice of any
profession, or intervene
directly or indirectly in the
management or control of
any private enterprise which
may, in anyway, be affected
by the functions of their
office. They shall not be,
directly or indirectly,
financially interested in any
contract with the government,
or any subdivision or
instrumentality thereof.

Sec. 1601. Appointment and

Compensation of Officials
and Employees. – All
employees of the
Commission shall be
appointed by the Chairperson
in accordance with, the Civil
Service Law except as the
private secretaries to the
offices of the Chairperson,
Commissioners and
Executive Director.

Sec. 1602. Official Seal. –

The Commission is
authorized to adopt an official
seal.
Sec. 1603. Functions of the
Commission. – The
Commission shall have the
following functions:

(a) Adjudicate cases on the

application of trade remedies
against imports pursuant to
Sections 711, 712 and 713 of
this Act;

(b) Study the impact of tariff

policies and programs on
national competitiveness and
consumer welfare in line with
the economic objectives of
the government;

(c) Administer the Philippine

tariff schedules and tariff
nomenclatures;

(d) Issue advance rulings on

tariff classification of imported
goods and render rulings on
disputes over tariff
classification of goods
pursuant to Section 1100 of
this Act, except in cases
involving goods on which the
Commission has provided
advance ruling on tariff
classification;

(e) Provide the President and

Congress with independent
analysis, information and
technical support on matters
related to tariff and nontariff
measures affecting Philippine
industries and exports for
policy guidance;

(f) Analyze the nature and

composition, and the
classification of goods
according to tariff commodity
classification and heading
number for customs and
other related purposes, which
information shall be furnished
the NEDA, DTI, DA, DOF,
DENR, and BSP;

(g) Review the trade

agreements for negotiation
and trade agreements
entered into by the
Philippines and make
recommendations, if
necessary, on the
consistency of the terms of
the agreements with the
national policy objectives;

(h) Conduct public

consultations and public
hearings pursuant to its
functions; and

(i) Deputize or delegate, to

appropriate government
agency its function of
rendering rulings on disputes
over tariff classification of
goods, until the plantilla
positions necessary for
undertaking such function
have been approved and
filled-up: Provided, That such
delegation of function shall
not extend beyond three (3)
years from the effectivity of
this Act.

Sec. 1604. Reports of the

Commission. –The
Commission shall place at
the disposal of the President
and any Member of the
Congress of the Philippines
all information at its
command. It shall conduct
such investigation and submit
reports as may be required
by the President and the
Congress of the Philippines.
It shall likewise report to the
President and Congress on
the first Monday of December
of each year and hereafter, a
statement of methods
adopted and a summary of all
reports made during the year.

Sec. 1605. Access to

Documents and Assistance
to the Commission. – The
Commission or its duly
authorized representative
shall have access to any
document, paper or record
pertinent to the subject
matter under investigation, in
the possession of any
person, firm, copartnership,
corporation, or association
engaged in the production,
importation, or distribution of
goods under investigation,
and shall have power to
summon witnesses, take
testimony, administer oaths,
and to issue subpoena duces
tecum requiring the
production of books, papers,
or documents relating to the
matter under investigation.
The Commission may also
request the views,
recommendations, and
assistance of any
government office, agency, or
instrumentality who shall be
expected to cooperate fully
with the Commission.

Sec. 1606. Sworn and

Verified Statements. – The
Commission may order the
taking of sworn statements at
any stage of any proceeding
or investigation before it. The
sworn statements must be
made before a person duly
authorized to administer
oaths.

The Commission is
authorized to require any
importer, grower, producer,
manufacturer or seller to file
with the Commission a
statement, under oath, giving
the selling prices in the
Philippines of goods
imported, grown, produced,
fabricated or manufacture d
by such person.

Sec. 1607. Implementing

Rules and Regulations. – The
Commission shall promulgate
and adopt such rules and
regulations as may be
necessary to carry out the
provisions of this Act.

CHAPTER 2

FLEXIBLE TARIFF

Sec. 1608. Flexible Clause. –

(a) In the interest of the
general welfare and national
security, and, subject to the
limitations prescribed under
this Act, the President, upon
the recommendation of the
NEDA, is hereby empowered
to:

(1) Increase, reduce, or

remove existing rates of
import duty including any
necessary change in
classification. The existing
rates may be increased or
decreased to any level, in
one or several stages, but in
no case shall the increased
rate of import duty be higher
than a maximum of one
hundred percent (100%) ad
valorem; (2) Establish import
quotas or ban imports of any
commodity, as may be
necessary; and

(3) Impose an additional duty

on all imports not exceeding
ten percent (10%) ad valorem
whenever necessary:
Provided, That upon periodic
investigations by the
Commission and
recommendation of the
NEDA, the President may
cause a gradual reduction of
rates of import duty granted
in Section 1611 of this Act,
including those subsequently
granted pursuant to this
section.

(b) Before any

recommendation is submitted
to the President by the NEDA
pursuant to the provisions of
this section, except in the
imposition of an additional
duty not exceeding ten
percent (10%) ad valorem,
the Commission shall
conduct an investigation and
shall hold public hearings
wherein interested parties
shall be afforded reasonable
opportunity to be present, to
produce evidence and to be
heard. The Commission shall
also hear the views and
recommendations of any
government office, agency, or
instrumentality. The
Commission shall submit its
findings and
recommendations to the
NEDA within thirty (30) days
after the termination of the
public hearings.

(c) The power of the

President to increase or
decrease rates of import duty
within the limits fixed in
subsection (a) hereof shall
include the authority to
modify the form of duty. In
modifying the form of duty,
the corresponding ad
valorem or specific
equivalents of the duly with
respect to imports from the
principal competing foreign
country for the most recent
representative period shall be
used as basis.

(d) Any order issued by the

President pursuant to the
provisions of this section
shall take effect thirty (30)
days after promulgation,
except in the imposition of
additional duty not exceeding
ten percent (10%) ad valorem
which shall take effect at the
discretion of the President.

(e) The power delegated to

the President as provided for
in this section shall be
exercised only when
Congress is not in session.

(f) The power herein

delegated may be withdrawn
or terminated by Congress
through a joint resolution.

The NEDA shall promulgate

rules and regulations
necessary to carry out the
provisions of this section.

Sec. 1609. Promotion of

Foreign Trade. – (a) For the
purpose of expanding foreign
markets for Philippine
products as a means of
assisting in the economic
development of the country,
in overcoming domestic
unemployment, in increasing
the purchasing power of the
Philippine peso, and in
establishing and maintaining
better relations between the
Philippines and other
countries, the President,
shall, from time to time:

(1) Enter into trade

agreements with foreign
governments or
instrumentalities thereof; and

(2) Modify import duties,

including any necessary
change in classification and
other import restrictions as
are required or appropriate to
carry out and promote foreign
trade with other countries:
Provided, That in modifying
import duties or fixing import
quota, the requirements
prescribed in subsection (a)
of Section 1608 of this Act
shall be observed: Provided,
however, That any
modification in import duties
and the fixing of import
quotas pursuant to the
various trade agreements the
Philippines has entered into,
shall not be subject to the
limitations of aforesaid
subsection (a) of Section
1608.
(b) The duties and other
import restrictions as
modified in subsection (a) of
this section, shall apply to
goods which are the growth,
produce, or manufacture of
the specific country, whether
imported directly or indirectly,
with which the Philippines
has entered into a trade
agreement: Provided, That
the President may suspend
the application of any
concession to goods which
are the growth, produce, or
manufactured product of the
specific country because of
acts or policies which tend to
defeat the purposes set in
this section, including the
operations of international
cartels; and the duties and
other import restrictions as
negotiated shall be in force
and effect from and after
such time as specified in the
order, without prejudice to the
Philippine commitments in
any ratified international
agreement or treaty.

(c) Nothing in this section

shall be construed to give
any authority to cancel or
reduce in any manner the
indebtedness of any foreign
country to the Philippines or
any claim of the Philippines
against any foreign country.

(d) Before any trade

agreement is concluded with
any foreign government or
instrumentality thereof,
reasonable public notice of
the intention to negotiate an
agreement with such
government or instrumentality
shall be given in order that
interested persons may have
an opportunity to present
their views to the
Commission. The
Commission shall seek
information and advice from
the DTI, DA, DOF, DENR,
DFA and BSP, and from such
other sources as it may deem
appropriate.

(e) In advising the President,

on a trade agreement
entered into by the
Philippines, the following
shall be observed:

(1) The Commission shall

determine whether or not the
domestic industry has
suffered or is being
threatened with injury and
whether or not the wholesale
prices at which the domestic
products are sold are
reasonable, taking into
account the cost of raw
materials, labor, overhead, a
fair return on investment, and
the overall efficiency of the
industry.

(2) The NEDA shall evaluate

the report of the Commission
and submit recommendations
to the President.

(3) Upon receipt of the report

of the findings and
recommendations of the
NEDA, the President may
prescribe adjustments in the
rates of import duties,
withdraw, modify or suspend,
in whole or in part, any
concession under any trade
agreement, establish import
quota, or institute such other
import restrictions, as the
NEDA recommends to be
necessary in order to fully
protect domestic industry and
the consumers, subject to

the condition that the

wholesale prices of the
domestic products shall be
reduced to, or maintained at,
the level recommended by
the NEDA unless, for good
cause shown, an increase
thereof, as recommended by
the NEDA is authorized by
the President. Should
increases be made without
such authority, the NEDA
shall immediately notify the
President who shall allow the
importation of competing-
products in such quantities as
to protect the public from the
unauthorized increase in
wholesale prices.

(f) This section shall not

prevent the effectivity of any
executive agreement or any
future preferential trade
agreement with any foreign
country.

(g) The NEDA and the

Commission shall promulgate
such reasonable procedures,
rules and regulations as they
may deem necessary to
execute their respective
functions under this section.

CHAPTER 3

TARIFF NOMENCLATURE
AND RATE OF DUTY

Sec. 1610. General Rules for

the Interpretation (GRI). –The
classification of goods and its
tariff nomenclature as
provided pursuant to this Act
shall be governed by the
following principles:

(1) The titles of sections,

chapters and subchapters
are provided for easy
reference only. For legal
purposes, classification shall
be determined according to
the terms of the headings
and any relative section or
chapter notes and, provided
such headings or notes do
not otherwise require,
according to the following1
provisions:

(2)(a) Any reference in a

heading to the goods shall be
taken to include a reference
to the same in their
incomplete or unfinished form
or state: Provided, That the
incomplete or unfinished
goods have the essential
character, as presented, of
the complete or finished
goods. It shall also be taken
to include a reference to the
same, in their complete or
finished form or state (or
falling- to be classified as
complete or finished by virtue
of this Rule), presented
unassembled or
disassembled.

(b) Any reference in a

heading to a material or
substance shall be taken to
include a reference to
mixtures or combinations of
that material or substance
with other materials or
substances. Any reference to
goods of a given material or
substance shall be taken to
include a reference to goods
consisting wholly or partly of
such material or substance.
The classification of goods
consisting of more than one
material or substance shall
be according to the principles
of Rule 3.

(3) When by application of

Rule 2(b) or for any other
reason, goods are, prima
facie, classifiable under two
(2) or more headings,
classification shall be
effected as follows:

(a) The heading which

provides the most specific
description shall be preferred
to headings providing a more
general description.
However, when two (2) or
more headings each refer to
part only of the materials or
substances contained in
mixed or composite goods or
to part only of the items in a
set put up for retail sale,
those headings are to be
regarded as equally specific
in relation to those goods,
even if one of them gives a
more complete or precise
description of the goods.

(b) Mixtures, composite

goods consisting of different
materials or made up of
different components, and
goods put up in sets for retail
sale, which cannot be
classified by reference to
3(a), shall be classified as if
they consisted of their
essential character, insofar
as this criterion is applicable.

(c) When goods cannot be

classified by reference to 3(a)
or 3(b), they shall be
classified under the heading
which occurs last in
numerical order among those
which equally merit
consideration;
(4) Goods which cannot be
classified in accordance with
the above Rules shall be
classified under the heading
appropriate to the goods to
which they are most akin.

(5) In addition to the

foregoing provisions, the
following Rules shall apply
with respect to the goods
referred to therein:

(a) Camera cases, musical

instrument cases, gun cases,
drawing instrument cases,
necklace cases and similar
containers, specially shaped
or fitted to contain specific
goods or set of goods,
suitable for long-term use
and presented with the goods
for which they are intended,
shall be classified with such
goods when of a kind
normally sold therewith. The
Rule does not, however,
apply to containers which
give the whole its essential
character; and

(b) Subject to the provisions

of Rule 5(a), packing
materials and packing
containers presented with the
goods therein shall be
classified with the goods if
they are of a kind normally
used for packing such goods.
However, this provision does
not apply when such packing
materials or packing
containers are clearly
suitable for repetitive use.

(6) For legal purposes, the

classification of goods in the
subheadings of a heading
shall be determined
according to the terms of
those subheadings and any
related subheading notes
and, mutatis mutandis, to the
above Rules, on the
understanding that only
subheadings at the same
level are comparable. For the
purposes of the Rule, the
relative section and Chapter
Notes also apply, unless the
context otherwise requires.

Sec. 1611. Tariff

Nomenclature and Rates of
Impart Duty. – The provisions
of Section 104 on Rates of
Import Duty of Presidential
Decree No. 1464, otherwise
known as the Tariff and
Customs Code of the
Philippines of 1978, as
amended, specifically
providing for the tariff
sections, chapters, headings
and subheadings and the
rates of import duty, shall still
apply and shall supplement
this Act. There shall be
levied, collected and paid
upon all imported goods the
rates of duty indicated
thereon except as otherwise
specifically provided for in
this Act: Provided, That the
maximum rate shall not
exceed one hundred percent
(100%) ad valorem.

The rates of duty provided or

subsequently fixed pursuant
to Sections 1608 and 1609 of
this Act shall be subject to
periodic investigation by the
Tariff Commission and may
be revised by the President,
upon the recommendation of
the NEDA.

It shall also apply to all

products, whether imported
directly or indirectly, of all
foreign countries, which do
not discriminate against
Philippine export products.
An additional one hundred
percent (100%) across-the-
board duty shall be levied on
the products of any foreign
country which discriminates
against Philippine export
products.

Sec. 1612. Tariff

Nomenclature and Rates of
Export Duty. – The provisions
of Section 514 on Export
Products Subject to Duty and
Rates of Presidential Decree
No. 1464, otherwise known
as the Tariff and Customs
Code of 1978, as amended,
specifically providing for the
export products subject to
duty and rates, shall still
apply and shall supplement
this Act.

TITLE XVII

CONGRESSIONAL
OVERSIGHT COMMITTEE

Sec. 1700. Congressional

Oversight Committee. – The
Congressional Customs and
Tariff Oversight Committee,
herein referred to as the
Committee, is hereby
constituted in accordance
with the provisions of this Act.
The Committee shall be
composed of the
Chairpersons of the
Committee on Ways and
Means of the Senate and
House of Representatives
and four (4) additional
members from each House,
to be designated by the
Senate President and the
Speaker of the House of
Representatives,
respectively. The Committee
shall, among others, in aid of
legislation:

(a) Monitor and ensure the

proper implementation of this
Act;

(b) Review the collection

performance of the Bureau;
and
(c) Review the
implementation of the
programs of the Bureau.

In furtherance of the
hereinabove cited objectives,
the Committee shall require
the Bureau to submit all
pertinent information which
includes:

(1) Industry audits;

(2) Collection performance

data; and

(3) Status report on

administrative, civil and
criminal actions initiated
against persons.

TITLE XVIII

FINAL PROVISIONS

Sec. 1800. Implementing

Rules and Regulations. – The
Secretary of Finance shall,
upon the recommendation of
the Commissioner,
promulgate the necessary
rules and regulations for the
effective implementation of
this Act.

Sec. 1801. Transitory

Provisions. – All suits,
proceedings, or prosecutions
whether civil or criminal, for
causes arising or acts done
or committed prior to the
effectivity of this Act, shall be
 "Sec. 1801. Abandonment,
Kinds and Effects of . — An
imported article is deemed
abandoned under any of the
following circumstances:
"(a) When the owner,
importer or consignee of the
imported article expressly
signifies in writing to the
Collector of Customs his
intentions to abandon; or
"(b) When the owner,
importer, consignee or
interested party after due
notice, fails to file an entry
within thirty (30) days, which
shall not be extendible, from
the date of discharge of the
last package from the vessel
or aircraft, or having filed
such entry, fails to claim his
importation within fifteen (15)
days which shall not likewise
be extendible, from the date
of posting of the notice to
claim such importation.
"Any person who
abandons an article or who
fails to claim his importation
as provided for in the
preceding paragraph shall be
deemed to have renounced
all his interests and property
rights therein."
"Sec. 1802. Abandonment
of Imported Articles. — An
abandoned article shall ipso
facto be deemed the property
commenced and prosecuted
within the same time in the
same manner and with the
same effect as if this Act had
not been enacted and all
rights acquired, offenses
committed, and penalties or
forfeitures or liabilities waived
prior to the said effectivity
shall not be affected thereby.
SEC 1802. Saving Clause. –
All other laws, acts, executive
orders, and Customs
Administrative Orders
(CAOs), Customs
Memorandum Orders
(CMOs), orders, memoranda,
circulars, rules and
regulations issued by the
Bureau, under the provisions
of Presidential Decree No.
1464, otherwise known as
the Tariff and Customs Code
of the Philippines of 1978, as
amended, not inconsistent
with the provisions of this Act,
shall remain valid unless the
same will be repealed or
amended accordingly,
pursuant to the provisions of
this Act.
Sec. 1803. Repealing
Clause. – Presidential
Decree No. 1464, otherwise
known as the Tariff and
Customs Code of the
Philippines of 19785 as
amended, and Presidential
Decree No. 1853 which
require any applicant for
of the Government and shall
be disposed of in accordance
with the provisions of this
Code.
"Nothing in this section
shall be construed as
relieving the owner or
importer from any criminal
liability which may arise from
any violation of law
committed in connection with
the importation of the
abandoned article.
"Any official or employee
of the Bureau of Customs or
of other government
agencies who, having
knowledge of the existence of
an abandoned article or
having control or custody of
such abandoned article, fails
to report to the Collector
within twenty-four (24) hours
from the time the article is
deemed abandoned, shall be
punished with the penalties
prescribed in Paragraph 1,
Section 3604 of this Code."
"Sec. 2301. Warrant for
Detention of Property-Cash
Bond. — Upon making any
seizure, the Collector shall
issue a warrant for the
detention of the property; and
if the owner or importer
desires to secure the release
of the property for legitimate
use, the Collector shall, with
the approval of the
letter of credit covering
imports to deposit the full
amount of duties due on the
importation, are hereby
expressly repealed. All other
laws, acts, presidential
decrees, executive orders,
rules and regulations or parts
thereof inconsistent with the
provisions of this Act are
hereby expressly repealed,
amended or modified
accordingly.
Sec. 1804. Separability
Clause. – If any provision of
this Act is declared invalid or
unconstitutional, the
remaining provisions or parts
shall remain in full force and
effect.
Sec. 1805. Effectivity. – This
Act shall take effect fifteen
(15) days after its publication
in the Official Gazette or in a
newspaper of general
circulation.
Commissioner of Customs,
surrender it upon the filing of
a cash bond, in an amount to
be fixed by him, conditioned
upon the payment of the
appraised value of the article
and/or any fine, expenses
and costs which may be
adjudged in the case:
Provided, That such
importation shall not be
released under any bond
when there is a prima facie
evidence of fraud in the
importation of article:
Provided, further, That
articles the importation of
which is prohibited by law
shall not be released under
any circumstance
whatsoever: Provided, finally,
That nothing in this section
shall be construed as
relieving the owner or
importer from any criminal
liability which may arise from
any violation of law
committed in connection with
the importation of the article."

"Sec. 2313. Review by

Commissioner. — The
person aggrieved by the
decision or action of the
Collector in any matter
presented upon protest or by
his action in any case of
seizure may, within fifteen
(15) days after notification in
writing by the Collector of his
action or decision, file a
written notice to the Collector
with a copy furnished to the
Commissioner of his intention
to appeal the action or
decision of the Collector to
the Commissioner.
Thereupon the Collector shall
forthwith transmit all the
records of the proceedings to
the Commissioner, who shall
approve, modify or reverse
the action or decision of the
Collector and take such steps
and make such orders as
may be necessary to give
effect to his decision:
Provided, That when an
appeal is filed beyond the
period herein prescribed, the
same shall be deemed
dismissed.

"If in any seizure

proceedings, the Collector
renders a decision adverse to
the Government, such
decision shall be
automatically reviewed by the
Commissioner and the
records of the case elevated
within five (5) days from the
promulgation of the decision
of the Collector. The
Commissioner shall render a
decision of the automatic
appeal within thirty (30) days
from receipt of the records of
the case. If the Collector's
decision is reversed by the
Commissioner, the decision
of the Commissioner shall be
final and executory. However,
if the Collector's decision is
affirmed, or if within thirty (30)
days from receipt of the
records of the case by the
Commissioner no decision is
rendered or the decision
involves imported articles
whose published value is
Five million pesos
(P5,000,000) or more, such
decision shall be deemed
automatically appealed to the
Secretary of Finance and the
records of the proceedings
shall be elevated within five
(5) days from the
promulgation of the decision
of the Commissioner or of the
Collector under appeal, as
the case may be: Provided,
further, That if the decision of
the Commissioner or of the
Collector under appeal, as
the case may be, is affirmed
by the Secretary of Finance,
or if within thirty (30) days
from receipt of the records of
the proceedings by the
Secretary of Finance, no
decision is rendered, the
decision of the Secretary of
Finance, or of the
Commissioner, or of the
Collector under appeal, as
the case may be, shall
become final and executory.

"In any seizure

proceeding, the release of
imported articles shall not be
allowed unless and until a
decision of the Collector has
been confirmed in writing by
the Commissioner of
Customs."

"Sec. 2503.
Undervaluation,
Misclassification and
Misdeclaration in Entry. —
When the dutiable value of
the imported articles shall be
so declared and entered that
the duties, based on the
declaration of the importer on
the face of the entry, would
be less by ten percent (10%)
than should be legally
collected, or when the
imported articles shall be so
described and entered that
the duties based on the
importer's description on the
face of the entry would be
less by ten percent (10%)
than should be legally
collected based on the tariff
classification, or when the
dutiable weight,
measurement or quantity of
imported articles is found
upon examination to exceed
by ten percent (10%) or more
than the entered weight,
measurement or quantity, a
surcharge shall be collected
from the importer in an
amount of not less than the
difference between the full
duty and the estimated duty
based upon the declaration of
the importer, nor more than
twice of such difference:
Provided, That an
undervaluation,
misdeclaration in weight,
measurement or quantity of
more than thirty percent
(30%) between the value,
weight, measurement, or
quantity declared in the entry,
and the actual value, weight,
quantity, or measurement
shall constitute a prima facie
evidence of fraud penalized
under Section 2530 of this
Code: Provided, further, That
any misdeclared or
undeclared imported
articles/items found upon
examination shall ipso facto
be forfeited in favor of the
Government to be disposed
of pursuant to the provisions
of this Code.

"When the undervaluation,

misdescription,
misclassification or
misdeclaration in the import
entry is intentional, the
importer shall be subject to
the penal provision under
Section 3602 of this Code."

"Sec. 2601. Property

Subject to Sale. — Property
in customs custody shall be
subject to sale under the
conditions hereinafter
provided:

"a. Abandoned articles;

"b. Articles entered

under warehousing entry not
withdrawn nor the duties and
taxes paid thereon within the
period prescribed under
Section 1908 of this Code;

"c. Seized property,

other than contraband, after
liability to sale shall have
been established by proper
administrative or judicial
proceedings in conformity
with the provisions of this
Code; and

"d. Any article subject to

valid lien for customs duties,
taxes or other charges
collectible by the Bureau of
Customs, after the expiration
of the period allowed for the
satisfaction of the same."

"Sec. 3407. Issuance,

Revocation and Suspension
of Certificate. — A candidate
who has passed the customs
brokers' examination shall be
entitled to the issuance of a
certificate as a customs
broker: Provided, That (1)
person who qualified as
customs broker in
accordance with customs
regulations existing before
the adoption of this Code; (2)
Commissioner of Customs
who has acted as ex officio
Chairman of the Board of
Examiners for Customs
Brokers and the Tariff
Commissioner of Customs
who have served as such in
any of the collection districts
for a period of at least five (5)
years, who desire to have a
certificate issued to them
may apply for the issuance of
such certificate, upon
payment of the fees required
under paragraph (b) of
Section Thirty-four hundred
and five of this Code.

"A customs broker's

certificate shall show, among
other things, the full name of
the registrant, shall have a
serial number and shall be
signed by all the members of
the Board of the
Commissioner of Civil
Service, and shall bear the
official seal of the Board.

"A complaint for the

suspension or revocation of
the certificate of a customs
broker shall be filed with the
Board of Examiners for
Customs Brokers which shall
investigate the case and shall
submit its findings and
recommendations to the
Commissioner of Civil
Service and shall
immediately furnish the
respondent customs broker
with a copy of his decision.

"Any person who files an

entry or facilitates the
processing or release of any
shipment shall be liable for
smuggling if the ostensible
owner, importer, or
consignee and/or the
ostensible given address of
the owner, importer, or
consignee is fictitious and the
shipment is found to be
unlawful. If the violator is a
customs broker, his license
shall also be revoked by the
Commissioner of Customs."

Sec. 2. Section 1803 of the

Tariff and Customs Code, as
amended, is hereby
repealed.

Sec. 3. The Secretary of

Finance shall, upon the
recommendation of the
Commissioner of Customs,
promulgate the rules and
regulations necessary for the
effective implementation of
this Act.

Sec. 4. Separability Clause.

— If any part of this Act
should, for any reason be
held to be invalid or
unconstitutional, the
remaining parts thereof shall
remain in full force and effect.

Sec. 5. Repealing Clause. —

All laws, decrees, executive
orders, rules and regulations
and other issuances
inconsistent with this Act are
hereby repealed or amended
accordingly.
Sec. 6. Effectivity Clause. —
This Act shall take effect after
fifteen (15) days from the
date of publication in the
Official Gazette or in at least
two (2) national newspapers
of general circulation,
whichever comes earlier.