Tariff and Customs Law

Sources
1. Customs
Modernization
and
Tariff Act of 2016 (RA 10863)
amended PD no. 1464
2. Special laws and regulation
enforced by the Bureau of
Customs.
Example: NIRC specifically VAT
applied to imported goods, excise
taxes, Documentary Stamp taxes
imposed on documentation of
importation process, Safeguard
Measures Act (RA 8800), AntiDumping
act
of
1999,
Countervailing
Act
(RA8751),
International Trade Agreement like
ASEAN agreement on the common
effective preferential Tariff Scheme,
Regulation within the authority of
the BOC like BSP circulars
Custom duty or Tariff is the name
given to taxes imposed for the
importation to and exportation from
the
Philippines
of
goods
or
commodities.
Nestle Philippines vs. CA July 6, 2001,
custom duty is the tariff or tax
assessed upon merchandise imported
from or exported to a foreign country.
Tariff can be understood in 3 senses 1)
Custom duty is a toll, tribute, etc
payable for the importation or
exportation of goods 2) Rates of
customs duties 3) List of articles/goods
subject to custom duties
Goods for purposes of custom duties is
defined Goods refer to articles, wares,
merchandise and any other items

which are subject of importation or

exportation
Case: US dollar as well as checks
being brought out the country by a
passenger can be considered as goods
because they are not use as legal in
tender in the Philippines.
When does importation begins?
Importation begins when the carrying
vessel or aircraft enters the Philippine
territory with the intention to unload
therein.
When does
depends.

importation

ends?

It

In case the article is subject to tax,

Importation is deemed terminated
when The duties, taxes and other
charges due upon the goods have
been paid or secured to be paid at the
port of entry unless the goods are free
from duties, taxes and other charges
and legal permit for withdrawal has
been granted;
Significance- once importation begins,
the Bureau of Customs will already
have jurisdiction and Taxes, Charges
will apply.
In case the goods are deemed free of
duties, taxes and other charges, the
goods have legally left the jurisdiction
of the Bureau. (Sec. 103, RA 10863)
Note: when the goods or articles
illegally left the country, jurisdiction
will not be lost. When the BOC finds
any violation to pertinent laws and
existing regulation, the goods may be
subject to seizure or forfeiture.

General rule as to the applicability

of duties, taxes and other charges
As a general rule, all goods, when
imported into the Philippines, shall be
subject to duty upon importation,
including goods previously exported
from the Philippines
Except as
otherwise provided for in this Act or in
other laws (Sec. 104)
Case: A Filipino citizen who left for
abroad wearing a diamond ring and
after 6 months came back wearing the
same diamond ring. If he fails to
declare said ring, he would be subject
to Custom duties.
As a rule, Imported goods shall be
subject to the import duty rates under
the applicable tariff heading that are
effective at the date of importation or
upon withdrawal from the warehouse
for consumption. In case of withdrawal
from free zones for introduction to the
customs territory, the duty rate at the
time of withdrawal shall be applicable
on the goods originally admitted,
whether withdrawn in its original or
advanced form (Sec. 105)
In case of goods sold at customs
public auction, the duty rates at the
date of the auction shall apply for
purposes of implementing Section
1143(a) of this Act.
Basic Rules on importation of goods:
1) all goods imported into the
Philippines shall be entered through a
customs office at a port of entry, or
may be admitted to or removed from a
free zone as defined in this Act, as the
case may be. (Sec. 400); 2) all
imported goods shall be subject to the

lodgement of a goods declaration. A

goods
declaration
may
be
for
consumption, for customs bonded
warehousing,
for
admission,
for
conditional importation, or for customs
transit unless otherwise provided for in
this Act. 3) All importations by the
government for its own use or for the
use of its branches, instrumentalities,
agencies, corporation owed by it
including GOCC shall be subject to
duties, taxes, fees and other charges
except those provided for under Sec.
800 (Conditionally Tax and/or DutyExempt
Importation)
4)
Goods
admitted to a free zone shall not be
subject to duties or taxes unless
otherwise provided by law governing
the free zone or rules and regulations
established in the free zone.
Note: all importation whether subject
to duties, taxes and other charges
should be entered into customs office
in the port of entry otherwise the
goods imported will be considered
smuggled into the Philippines
What are considered as port of
entries? Port of Entry refers to a
domestic port open to both domestic
and international trade, including
principal ports of entry and subports of
entry.
A principal port of entry is the chief
port of entry of the Customs District
wherein it is situated and is the
permanent station of the District
Collector of such port.
Subports of entry are under
administrative jurisdiction of
District Collector of the principal
of entry of the Customs District.

the
the
port
Port

of entry as used in this Act shall

include airport of entry
Note: RA 10863 designated the
Principal ports of entry. The rationale
behind rule on the passing of goods
thru a PPE is to safeguard customs
revenue.
Customs Territory refers to areas in
the Philippines where customs and
tariff laws may be enforced
Free Zone refers to special economic
zones registered with the Philippine
Economic Zone Authority (PEZA) under
Republic Act No. 7916, as amended,
duly chartered or legislated special
economic zones and freeports such as
Clark Freeport Zone, etc and such
other freeports as established or may
be created by law.
Different types
exporation

of

importation

or

Different Types of goods that can be

exported from or imported to the
Philippines:
1)
Goods
of
Free
importation or exportation under (Sec.
116)
2)
Goods
of
prohibited
importation or exportation (Sec. 118)
3) Goods of Regulated exportation or
exportation (Sec. 117) 4) Relief
Consignment (Sec. 120)
Different Types of importation: 1)
Prohibited importation 2) Restricted
importation 3) Conditionally taxed
and/or duty free importation 4)
Dutiable Importations 5) Duty free
importation

Sec. 116, as a general Rule, all goods

may be freely may be freely imported
into and exported from the Philippines
without need for import and export
permits, clearances or licenses unless
otherwise
provided
by
law
or
regulation.
Free
importation/
exportation are goods or commodities
where the importation or importation
of which is neither regulated nor
prohibited. There is no need for prior
approval or clearance from any
government agency for said goods to
be imported to or exported from the
Philippines.
Two kinds of prohibited goods under
the old law which are enumerated in
one list: 1) Goods that are absolutely
prohibited
2)
Goods
qualifiedly
prohibited or restricted under the new
law; the two types of prohibited goods
are mentioned separately.
Under Sec. 118, the importation and
exportation of the goods enumerated
under this section cannot be done
under
circumstances
(Prohibited
importation or exportation) before
they are referred to as contrabands.
Goods
that
are
of
Restricted
Importations are generally prohibited
but with proper permit/ licenses/
approval
by
the
appropriate
governmental agency, said goods can
be imported.
Examples of Prohibited importation
and exportation: 1) Written or printed
goods in any form containing any
matter advocating or inciting treason,
rebellion, insurrection, sedition against
the government of the Philippines, or
forcible resistance to any law of the

Philippines, or written or printed goods

containing any threat to take the life
of, or inflict bodily harm upon any
person in the Philippines 2) 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 3) 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
4)
Any
adulterated
or
misbranded food or goods for human
consumption or any adulterated or
misbranded drug in violation of
relevant laws and regulations 5)
Written or printed goods, negatives or
cinematographic films, photographs,
engravings,
lithographs,
objects,
paintings,
drawings
or
other
representation of an obscene or
immoral character 6) Infringing goods
as defined under the Intellectual
Property Code and related laws 7) All
other goods or parts thereof which
importation
and
exportation
are
explicitly prohibited by law or rules
and
regulations
issued
by
the
competent
authority
(Catch
all
provisions)
Penalty:
Seizure
and
forfeiture of good abovementioned but
also other goods which in the opinion
of the district collector have been used
are or to be used as instrument
to
import said article under 1113F and
thereafter to be destroyed.
Goods
of
restricted
importation/exportation (Sec 119), as

a general Rule, can be done in the

Philippines when authorized by law
and regulation. Example: 1) Dynamite,
gunpowder, ammunitions and other
explosives, firearms and weapons of
war, or parts thereof 2) gambling
paraphernalia
3)
Lottery
and
sweepstakes
tickets,
except
advertisements thereof and lists of
drawings therein 4) 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 (before
they are enumerated as prohibited) 5)
Opium pipes or parts thereof, of
whatever material 6) Any other goods
whose importation and exportation are
restricted ( catch all provision)
Duty-free importation (Sec. 121)
Examples:
a) Sec.
Goods

120 Relief Consignment,

such

as

food,

medicine,

equipment and materials for shelter,

donated

or

institutions

leased
and

to

government

accredited

private

entities for free distribution to or use

of

victims

treated

of

and

consignment.

calamities
entered

shall
as

be

relief

Requisites of Relief Consignment: 1)

imported during state of Calamity 2)
intended for specific area affected by
calamity 3) for the use of the calamity
victims in sad area.
b) Importation of De Minimis Value
(Sec. 423), if the FOB or FCA value
does not exceed 10k, no duties and
taxes shall be collected on goods
c) Goods admitted in Free Zones (Sec.
815) - goods admitted into a free zone
shall not be subject to duty and tax
unless otherwise provided under the
respective laws, rules and regulations
of the free zone
d) Sec 820 of the CMTA
Stores which are carried in a
vessel/aircraft or train arriving in the
customs territory and remaining in the
vessel/aircraft/train or in other words
they remain on board thereon would
be exempt from duty, charges and
taxes.
What are stores? These are Items for
1) consumption of the passengers and
the crew in the course of the travel. 2)
These can also refer to articles or
equipments for the use of the
vessel/aircraft for its operation
Once said goods are unloaded, they
are not anymore duty-free because it
would
be
commencement
of
importation. Examples: anchor
3) Replenishment of the stores. A
train/vessel/aircraft may requisition
goods to be used as stores.
Conditionally free importation (Sec.
800), will be exempt from duties and

taxes if the conditions provided by law

are complied.
If said goods are used/ bartered/ sold
other than the purpose to which they
are
imported,
they
loss
their
exemption. Exceptions: 1) sale of the
imported pursuant to a judicial order.
2) Sale in liquidation of the estate of a
deceased person
Examples
of
conditionally
free
importations: a) Aquatic products such
as fishes, crustaceans, mollusks,
marine animals caught or gathered of
fishing vessels of Philippine registry;
Provided, That they are imported in
such vessels or in crafts attached
thereto; Provided, However, That they
have not been landed in any foreign
territory or, if so landed, that they
have
been
landed
solely
for
transshipment without having been
advanced in condition; Note: salting a
fish for preservation does not make it
advanced in condition.
A fishing vessel of Philippine registry
caught fish in Taiwan and dried and
salted therein. Thereafter, the fishes
were brought to the Philippines. Said
fish will be exempt from duties and
taxes as long as the fish must have
brought by the same vessel which
caught them from the sea at least
carrying the fishes in a watercraft
attached to the said vessel. But if the
fishes were landed in Taiwan and they
were canned there. It would now be
subject to duties because they are
already in advanced condition.
b) Equipment for use in the salvage of
vessels or aircrafts. The conditions
that must be complied so that it would

be exempt from duties: 1) they are not

available in the Philippines 2) the
importer must put up a bond in an
amount equal to 100% of the
supposed duties, taxes and other
charges due on the equipment. The
bond is conditioned that after the use
of the Equipment for use in the
salvage of vessels or aircrafts, it must
be exported from the Philippines or if
not exported, the bond is also
conditioned on the payment of DTC
due on the equipment and the bond
will be effective for a period of 6
months from the date of acceptance of
goods declaration 3) the equipment
must be duly identified. Otherwise, the
equipment will be subject to DTC.
Note: The Bureau may extend the time
for exportation or payment of duties,
taxes and other charges for a term not
exceeding six (6) months from the
expiration of the original period
c) A vessel of Philippine registry has to
undergo repairs in a foreign country.
The item that would be considered
conditionally free from duties and
taxes is the cost of the repairs.
Conditions to be complied to be duty
free: 1) the repair must have been
done in a foreign country 2) it must be
repair of vessels or aircrafts registered
or licensed in the Philippines 3) proof
satisfactory to the bureau of customs
that there is no adequate for such
repairs in the Philippines or the vessel
or aircraft is compelled to land to a
foreign country due to stress of the
weather and other casualties to secure
the sea or air worthiness of the aircraft
to reach its destination.

d) Goods brought into the Philippines

for repair, processing or reconditioning
to be reexported upon completion of
the
repair,
processing
or
reconditioning.
Conditions to be complied for the
goods to be exempt: 1) the Bureau
shall require security equal to one
hundred percent (100%) of the duties,
taxes and other charges thereon or if
not exported within 6 months the
importer must pay the corresponding
DTC of the goods brought in the
Philippines.
e) Medals, badges, cups, and other
small goods bestowed as trophies or
prizes, or those received or accepted
as honorary distinction. Condition: 1) it
must be given to importer as trophy,
prize or must be received or accepted
as honorary distinction.
f) Two classes of Personal and
Household effects: 1) Personal and
Household
effects
which
were
exported from the Philippines (Effects
brought out by a citizen and brought
back to the Philippines) 2) Personal
and Household effects purchased by a
Filipino Citizen from abroad and being
brought back to the Philippines.
First
Class:
Conditions
to
be
complied with: 1) the Personal and
Household effects belong to a resident
of the Philippines returning from
abroad. 2) They must be formally
declared and listed before departure
from the Philippines 3) he must
identify the goods under oath before
the district collector of customs at
least before leaving the Philippines or
while abroad 4) the following are

considered as personal and household

effects; household appliances, jewelry,
precious stoned and other goods of
luxury 5) not in commercial quantity
6) not intended for barter, sale or like
7) the FOB or FCA value must not be
more than P350,000 if the returning
resident stayed abroad for at least 10
years and he must have availed of this
privilege only once within 10 years or
if the returning citizen stayed abroad
for less than 10 years but at least 5
years, the value of the Personal and
Household effects that could be
imported free from duty is 250,000. If
the stay abroad is less than 5 years,
the Personal and Household effects
that could be imported free from duty
is only 150,000. Note: the excess is
subject to duties and taxes
Note: Overlapping of period under RA
10863
Who are considered as returning
residents? These are Filipino citizens
who stayed abroad for at least 6
months abroad.
Suppose the effects were advanced or
improved when the returning citizen is
abroad. Only the increment of the
value would be subject to duties and
taxes.
Second Class: conditions to be
complied 1) they must be necessary,
appropriate for the use or comfort and
convenience of the returning resident
during stay abroad; 2) the personal
and
household
effects
must
accompany them in their return in the
Philippines or must arrive in the
Philippines within reasonable time
which,
barring
unforeseen
and

fortuitous events, in no case shall

exceed sixty (60) days after the
owner's return 3) it must consist of
wearing apparel, goods of personal
adornment, toilet goods, instruments
related to one's profession and
analogous personal or household
effects,
excluding
luxury
items,
vehicles, watercrafts, aircrafts and
animals purchased in foreign countries
4) not in commercial quantity 5) not
intended for barter, sale or like 6) the
FOB or FCA value must not be more
than P350,000 if the returning resident
stayed abroad for at least 10 years
and he must have availed of this
privilege only once within 10 years or
if the returning citizen stayed abroad
for less than 10 years but at least 5
years, the value of the Personal and
Household effects that could be
imported free from duty is 250,000. If
the stay abroad is less than 5 years,
the Personal and Household effects
that could be imported free from duty
is only 150,000. Note: the excess is
subject to duties and taxes 8) the
returning resident must be a Filipino
national who must have stayed in a
foreign country for at least 6 months.
7) Excess shall be dutiable
BAR 2003: X and His Y wife, Filipino
residents, went to a 3 months pleasure
trip to a foreign country. In the course
of their trip, they accumulated some
personal effects which are necessary,
appropriate
and normally use in
leisure trip as well as souvenirs and
not in commercial quantity. Are they
returning citizens for the purpose of
tariff and customs code? No, because
they only stayed abroad 3 months less

than what is required by law which is 6

months.
Note: in case of OFWs, they shall have
the privilege to bring in, tax and dutyfree, home appliances and other
durables (similar to Personal and
household effects), limited to one of
every kind once in a given calendar
year accompanying them on their
return, or arriving within a reasonable
time which, barring unforeseen and
fortuitous events, in no case shall
exceed sixty (60) days after every
returning
OFW's
return
upon
presentation of their original passport
at the port of entry. Excess in the no.
shall be dutiable.
g) In the case of Residents of the
Philippines, OFWs or other Filipinos
while residing abroad or upon their
return to the Philippines, they shall be
allowed to bring in or send to their
families or relatives in the Philippines
balikbayan boxes which shall be
exempt from applicable duties and
taxes imposed under the NIRC of
1997, as amended
Conditions: 1) balikbayan boxes shall
contain
personal
and
household
effects only 2) not in commercial
quantity 3) not intended for barter,
sale or for hire 4) the FCA value of
which shall not exceed one hundred
fifty thousand pesos (150,000.00) 5)
can only be availed of only up to 3
times in a calendar year. Excess in the
FCA shall be dutiable.
Bar: X a balikbayan has a used car
among the items he brought to the
Philippines where he will resettle for
30 years after living to California for

30 years. He also brought with him a

VCD machine and a stereo. Will the
imported articles of X be subject to
duties? The used car cannot qualify as
Personal and household effect, hence,
subject to duties.
l) A) Importations for the official use of
foreign embassies, legations and other
agencies
of
foreign
government
provided that those foreign countries
accord like privileges to corresponding
agencies of the Philippines. B) Goods
imported for the personal or family
use of members and attaches of
foreign embassies, legations, consular
officers and other representatives of
foreign governments provided That
such privilege shall be accorded under
special agreements between the
Philippines and the countries which
they represent
m) importation of donated articles:
conditions: 1) Imported goods donated
to or, for the account of the Philippine
government or any duly registered
relief organization not operated for
profit 2) the deed of donation must be
duly authenticated 3) the done must
execute a deed of acceptance 4) proof
that the done is duly registered with
the
SEC
or
relief
organization
registered with the DSWD 5)
the
importation is for free distribution
among
the
needy
and
upon
certification by the DSWD or the
Department of Education (DepED), or
the Department of Health (DOH), as
the case may be
BAR: An imported ambulance was
donated
to
a
registered
relief
organization. Would it be dutiable?

Yes, because the ambulance cannot be

distributed for the needy.

zoological
purposes

p) 1) Importation of goods or salvage

from a vessel abandoned or wrecked
outside the territorial jurisdiction of
the Philippines 2)parts or equipment of
a foreign vessel abandoned or
wrecked
inside
or
outside
the
territorial
jurisdiction
of
the
Philippines.

What goods or articles cannot be

imported without authority from the
government and duly authorized
institution? Live trees, shoots, plants,
moss and bulbs, tubers and seeds for
propagation purposes

Note: bringing of parts or equipment

of foreign vessel even if found outside
the Philippines is called importation
because the said articles are found
from a vessel of foreign registry.
Condition: said articles must be
imported after two years from the date
of the filing of the marine protest by
the captain of the vessel or if no
protest has been fled, it must be
imported after two years after the
abandonment or wreckage otherwise,
said articles would be subject to DTC.
Note: No part of a Philippine vessel or
aircraft or its equipment, wrecked
either in Philippine or foreign waters,
shall be subject to duty (Sec. 418, Last
paragraph).
q) Importation of coffins or urns.
Conditions: 1) they must contain
human remains, bones or ashes, used
personal and household effects (not
merchandise) of the deceased person,
except vehicles 2) the FCA value of
which does not exceed one hundred
fifty thousand pesos (150,000.00)
s) Importation of animals except race
horses and plants intended for
scientific, experimental propagation or
breeding, and for other botanical,

and

national

defense

Note: for animals imported for

breeding
purpose,
the
following
conditions must be complied: 1) must
be restricted animals of recognized
breed 2) the breed of the animal in the
record or registry established for the
breed. The breed of the animal must
be certified by the Bureau of Animal
Industry
u) Situations: 1) in the case of locally
manufactured
goods
previously
exported for some purpose and
returned to the Philippines thereafter
provided
they
did
not
incur
advancement or improvement and
that no drawback or bounty has been
allowed to the article; 2) foreign goods
previously
imported
into
the
Philippines
(which
were
already
subject to DTC) were exported to a
foreign country then re-imported back
to the Philippines. However, their
exportation must be for exhibition,
testing and experimentation, for
scientific or educational purposes 3)
foreign containers previously imported
into the Philippines and exported back
used as packaging for goods exported
from the Philippines and after being
empty returned back to the Philippines
as importation provided they are not
for sale and duly identified (The same
article imported)

x) Importation of spare parts for vessel

or aircrafts of foreign registry engage
in foreign trade. The spare parts must
have been brought to the Philippines
exclusively for replacement or for
emergency repair of the foreign vessel
or aircraft. There must be proof to the
district collector that said spare parts
will be used to secure the safety,
seaworthiness or airworthiness of the
vessel or aircraft, to enable it to
continue its voyage or flight
aa) Importation of personal and
household effects including one motor
car imported by: 1) officer or
employee of the DFA 2) military or civil
attach 3) members of the staff
assigned to a Philippine Diplomatic
mission abroad 4) similar officer or
employee
assigned
to
other
departments
assigned
to
any
Philippine consular office abroad 5)
AFP military personnel accorded
assimilated diplomatic rank or on duty
Provided they are returning from a
regular
assignment
abroad
2)
returning
for
reassignment
3)
returning because said person had
already died, he resigned or he retires.
Conditions: 1) importation of Personal
and household effects including one
motor car 2) personal and household
effects must have purchased or
ordered abroad by said persons prior
to receipt by the mission or consulate
of the order of recall 3) it must
registered in his own name 4) the
exemption shall apply only to the
value of the motor car and to the
aggregate assessed value of the
personal and household effects should
not exceed thirty percent (30%) of the

total amount of salary and allowances

received by the officer and not
exceeding
four (4) years during
assignment abroad. 5) this privilege
can only availed once every four years
6) the officer or employee must have
served abroad for at least 2 years.
Dutiable Importation- these are
importations which are subject to
duties, taxes, fees and other charges.
2 kinds of customs duties: 1) Regular
Customs duties 2) Special Customs
Duties.
Regular Customs Duties- if the
customs duties is imposed to raise
revenue for the government or
imposed as a tariff barrier (these are
protective tariff which may be
imposed to imported articles in order
to prevent the entry into the country
of
goods
that
will
compete
prejudicially the local manufacturers
or local products). They may also be
imposed to exports to discourage the
importation of certain raw materials so
that they may be manufactured
locally.
Different kinds of regular customs
duties: 1) Ad valorem customs duties
2) special or specific customs duties 3)
the mixed or compound customs
duties 4) alternative customs duties
Ad valorem customs duties- duties are
considered ad valorem if they are
computed on the basis of the value of
imported or exported goods. The rates
of the duties are applied to the value
Specific customs duties- the amount of
the duty or the rate of the duty is
applied to the goods based on a unit

measure. Example: per gram, per

piece, per litter or per lineal meter.
Compound customs duties if it is
both
ad
valorem
and
specific.
Example: when the customs duties is
10% of the value + 100php per
kilogram.
Alternative customs duties- if the
customs duties are either based on
the value or on per unit of measure
whichever results to higher amount of
duty. (No longer applicable today)
Special Customs duties- are duties
imposed in addition to the regular
customs
duties
under
certain
conditions or circumstances. The
purpose of the imposition is to protect
local
consumers/manufacturers/Philippine
products from undue competition from
foreign
made
product/domestic
industries/ domestic producers.
Different kinds of Special customs
duties imposed under special laws
and the customs modernization and
tariff act: 1) Anti-dumping duty (RA
8752) - Sec. 711 of RA 10863 2)
Counter-veiling duty Sec. 713 3)
Marking
duty

Sec
710
4)
discriminatory duty- sec. 714 5)
safeguard duty- safe guard measure
act (RA 8800) Sec 712.
Specific Customs duties if the
custom duties is imposed on the basis
of weight (Net weight or Legal or Gross
weight) of the imported article.
Gross weight - it means the weight of
the imported goods itself and the
weight of all the packages, containers,
holders and packing.

Legal Weight it means the weight of

the article itself plus the weight of the
immediate
container,
holder
or
packing in which the article is usually
contained, held or packed.
Net weight it means the actual
weight of the imported article
excluding the weight of the containers,
etc.
Example: Importation of sardines
Gross weight of sardines- sardines +
sauce + tin can + cartoons + wooden
packages
Legal weight of sardines sardines +
sauce + tin can
Net weight sardines + sauce
Gross weight = Legal weight
importation of rice, fertilizers

Gross weight = legal weight = net

weight = importation of coal, crude oil
or wheat because they are imported in
bulk.
Cinematographic films are subject to
duties based on lineal meters.
Basic rules on importation of
articles: 1) that all goods imported to
the Philippines shall be entered thru a
customs office at the port of entry
except under Sections 417 and 800L.
2) sec. 201 all imported goods shall
be subject to lodgement of goods
declaration unless otherwise provided
by RA 10863.
Lodgement refers to the registration of
a goods declaration with the Bureau
(Sec. 102dd).

Goods
Declaration
refers
to
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 (Sec. 102y).
2 kinds of entries: 1) import entry for
imported goods. 2) Entry for vessels or
aircrafts engaged in foreign trade
(whenever they land in port of entry in
the Philippines, they must also make
an entry)
Different kinds of goods declaration: 1)
Goods declaration for consumption 2)
for customs bonded warehousing for
admission to the economic zones 3)
goods declaration for conditional
importation 4) goods declaration for
customs transit
Requirements of lodgement for the
importation which is made for goods
declaration for consumption: 1) the
importation should be cleared thru a
formal entry process except in the
following importation which can be
cleared thru an informal entry process;
a) Goods of a commercial nature with
Free on Board (FOB) or Free Carrier At
(FCA) value of less than fifty thousand
pesos (50,000.00); b) Personal and
household effects or goods, not in
commercial quantity, imported in a
passengers baggage or mail.
Additional requirement if imported
goods is entered thru formal entry
process: the importation must be
covered by a letter of credit or any

verifiable
commercial
document
evidencing
payment
(Commercial
invoice issued by exporter) or in cases
where there is no sale for export, by
any commercial document indicating
commercial value of the imported
goods.
Provisional (Incomplete) Goods
Declaration may be allowed 1)
when the declarant does not have all
the
information
or
supporting
documents required to complete the
goods declaration, the lodging of a
provisional goods declaration 2) it
substantially contains the necessary
information required by the Bureau
and 3) the declarant undertakes to
complete the information or submit
the supporting documents within fortyfive (45) days from the filing of the
provisional goods declaration, which
period may be extended by the
Bureau for another forty-five (45) days
for valid reasons (the treatment is as if
the declaration is complete)
Question: Suppose the imported goods
were merely covered by Provisional
(Incomplete) Goods Declaration, can
the goods be released from customs
custody? Yes, upon posting of any
required security equivalent to the
amount ascertained
to
be
the
applicable duties and taxes (Sec. 403,
3rd paragraph). But is required that the
importer
must
complete
the
declaration.
The
lodgement
of
the
goods
declaration must be made within 15
days counted from the date of
discharge of the last package of the
importation from the carrier, vessel or
aircraft which carried the goods into

the Philippines. But if the goods are to

be transshipped, the lodgement of the
goods declaration must also be made
within 15 days from the date of
discharge of the last package from the
carrier at the final destination of the
importation. It can be extended upon
request.
The lodgement should be by electronic
means and at any designated customs
office (Sections 407 and 408).
May the lodgement of the good
declaration be made prior to the
arrival of the goods in the Philippines?
Yes as provided for under Sec. 409.
Can there be formal or informal entry
of imported goods before lodgement
of goods declaration? No as provided
for under section 412.
Split entry of imported goods an
entry made simultaneously in part for
consumption
and
in
part
for
warehousing. However, the goods
imported goods are only covered with
one bill of lading or airway bill.

2. Submission and acceptance of

documents
related
to
an
importation
3. Procedure of passing goods
through customs house
Q: what is the operative act? It is
the
filing
of
the
specified
documents or entry form and other
documents required by law or
regulation
Q: what is Import entry internal
revenue declaration (IEIRD)?
Note: import entry is different from
IEIRD. Note also that import entry
serves as basis for payment of
advanced duties
Q: How to declare postal items?
A: by filing a special declaration
form
plus
other
supporting
documents
Instances which should be declared
in the regular good declaration
(Separate Declaration) Sec. 438

Q: what is split entry? Goods covered

by one bill of Lading or airway bill over
goods which are meant in part as
consumption
and
in
part
for
warehousing may be both entered
simultaneously for release at the port
of entry.

a. If the goods whose value fall

within the level that the
commissioner has determined
to be taxable and thus must be
covered by a goods declaration;
b. Prohibited and regulated goods
c. Goods, the exportation of which
must be certified
d. Imported
goods
under
a
customs procedure other than
for consumption

Making of and Import Entry

Examination of Imported Goods

Note: Split entry is allowed here in the

Philippines

1. Document filed with the BOC

GR: Physical examination

Note: conditions for examination

under Sec. 420.
XPN: the Bureau may adopt
nonintrusive examination of goods
such as the use of x-ray machines
(per parcel of per container)
Physical examination of the goods
shall be conducted when:
a. If it is directed by the
commissioner or on account of
a
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
or
controversies surrounding the
goods declaration and import
clearance process; or
e. Importer or declarant request
for the examination of the
goods.

Note: If the transaction value system

is not applicable, Transaction value of
identical goods shall be applied
Note: these methods shall be used or
applied sequentially, if prior method is
not applicable
However, importer may request that if
transaction
value
cannot
be
determined, computed value may be
applied first before deductive value.
If computed value
then it is still the
the first value
inapplicable, apply

cannot be applied,
deductive value. If
methods are all
the fall-back value

Q: what would be the standard to be

used of the examiner; how should the
custom
authority
make
the
classification?
A: Sec. 104 of P.D. no. 1464
Note: in such a case, the maximum
rate to be applied shall not exceed
100% ad valorem.

How should the value of the goods be

determined is subject to ad valorem

Assessment

6 methods

Sec. 424: duty of customs officer

tasked to assess imported goods

a. Transaction value system

b. Transaction value of identical
goods
c. Transaction value of similar
goods
d. Deductive value
e. Computed value
f. Fall-back value
Q: what method shall be used if the
goods are subject to ad valorem?
A: primarily, it is the transaction value
system under Sec. 701.

a. Classify
b. Value
c. Determine the duties and taxes
to be paid
d. Prepare and submit assessment
report to the director
2 kinds of assessment (Sec. 425)
1. Tentative assessment
2. Final assessment

Tentative assessment- if the duties

and taxes initially assessed are
disputed by the importer

1. Upon statement of error; this must

be made within 1 year after the
payment of duties

Completed

2. Upon request for reappraisal or

reclassification addressed to the
commissioner by the district collector,
if the is .. to be.

Upon the re-adjustment base or

the tariff ruling in case of
classification dispute, or
The final resolution of the
protest case involving valuation,
rules of origin and other custom
issues

Q: may it be refused to the importer

even if there is only / merely tentative
assessment?
A: Yes, but the importer must post
sufficient security to cover the
applicable duties and taxes equivalent
to the amount that is disputed
Tentative Assessment may be made as
provisional
goods
declaration.
However such assessment shall be
completed upon final readjustment or
reclassification or submission by the
declarant of the additional information
or documentation required to be
complete the declaration with the
period provided in Sec. 403 of this act
(Sec. 426)
Q: if such appraisal, classification or
return
as
finally
passed
upon,
approved or modified by the district
collector, can it be altered or modified
in any manner?
A: as a general it cannot be anymore
modified or altered (Sec. 427)
XPNS:

- must be made within 15 days after

such payment
3. Upon request for reappraisal and/or
reclassification in the form of a final
protest addressed to the district
collector by the interested party if the
latter should be dissatisfied with the
appraisal or return
4. upon demand of the commissioner
upon completion of compliance audit
Q: May an importation be assessed for
a value less than the entered value?
A: as a general rule, duties, taxes, fees
and charges of imported goods must
be assessed not less than the entered
value because entered value is the
value declared by the importer.
XPNS: Instances where assessed value
is less than the entered value
1. Upon
direction
of
the
commissioner in cases where
the importer certifies a t the
time of entry that the entered
value is higher than the dutiable
value and that the goods are so
entered in order to meet
increased
made
by
the
appraiser in similar cases then
pending re-appraisement
2. When the importers contention
was sustained by a
final

decision and shall appear that

such action of the importer was
taken in good faith after due
diligence and inquiry
Sec. 429: Final Assessment:
Q: when does assessment becomes
final?
A: 15 days after notice of assessment
to importer or consignee
Q: when does assessment becomes
conclusive to all parties?
A: Sec. 430, 3 years from the date of
final payment of duties and taxes or
upon completion of the post clearance
audit
XPN: when there is fraud
Liquidation:
It is composed of:
a. Final
computation
and
assessment of duties, taxes,
fees and charges due on the
imported article
Note: it is the district collector who
determine the final computation
Basis for determination: official
reports of the customs officer who
made
the
classification
and
assessment
b. Payment of duties, taxes, fees
and other charges on the
imported article

2 kinds of liquidation (Sections 425426)

a. Tentative liquidation if future
action is still necessary to
determine correct amount of
DTFC
Example: if there is a need
classifying, re-computation or
appraisal of DTFC

for
re-

-it is subject to final adjustment and

settlement within 6 months.
b. Final liquidation
- if all the requisites as to procedure
covering the entry up to the
assessment of DTFC have been
accomplished and approved by the
district collector of customs and when
there is payment made.
-imported goods are cleared
customs duties (if exempt)

from