Tariff and Customs Law

upon the goods have been paid or secured

to be paid at the port of entry;

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:
a. NIRC specifically VAT applied to imported
goods, excise taxes, Documentary Stamp
taxes imposed on documentation of
importation process;
b. Safeguard Measures Act (RA 8800);
c. Anti-Dumping act of 1999;
d. Countervailing Act (RA8751);
e. International Trade Agreement like ASEAN
agreement on the common effective
preferential Tariff Scheme;
f. Regulations 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.
Case: 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 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 or goods subject to custom
duties;
Q: what is the meaning of goods for purposes of
custom duties?
A:Goods refer to articles, wares, merchandise or
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 tender in the Philippines.
Q:When doesimportation begins?
A: Importation begins when the carrying vessel or
aircraft enters the Philippine territory with the
intention to unload therein.
Q: When does importation ends?
A: It depends.
a. In case the article is subject to tax,
Importation is deemed terminated when
The duties, taxes and other charges due

b. In case the goods are free from duties,

taxes and other charges, importation is
deemed terminated when legal permit for
withdrawal has been granted.
Q: Whyis it significant to determine the beginning
of importation?
A: Becauseonce importation begins, the Bureau of
Customs will acquire jurisdiction and Duties,
Taxes, fees and other Charges will apply.
Note: when the goods or articles illegally left the
country, jurisdiction will not be lost.And when the
BOC finds any violation to pertinent laws and
existing regulation, the goods may be subject to
seizure and forfeiture.
General rule as to the applicability
duties, taxes and other charges

of

GR: all goods, when imported into the

Philippines, shall be subject to duty upon
importation, including goods previously exported
from the Philippines
XPN: if this Act or otherpertinent laws provides
otherwise (Sec. 104).
Case: A Filipino citizen who left for abroad
wearing a diamond ring. After 6 months, He came
back wearing the same diamond ring. If he fails to
declare said ring, he would be subject to Custom
duties.
GR: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.
XPN:
A. 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)
B. 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.

Note: 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
owned 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.
Q: What are considered as Port of entries?
A: Port of Entry refers to a domestic port open
to both domestic and international trade,
including principal ports of entry and subports of
entry.
Note: Port of entry as used in this Act shall
include airport of entry.
Q: What is a Principal port?
A: Principal port of entry is the chief port of
entry of the Customs District where it is situated
and is the permanent station of the District
Collector of such port.
Q: what areSubports?
A: Subportsof entry are those under the
administrative jurisdiction of the District Collector
of the principal port of entry of the Customs
District.
Note: RA 10863 designated the Principal ports of
entry. The rationale behind rule on the passing of
goods thru a Principal port of entry is to
safeguard customs revenue.

economic zones and freeports such as Clark

Freeport Zone and such other freeports as may
be created by law.
Different
types
exportation:

of

importation

or

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); and
4. Relief Consignment (Sec. 120).
Different Types of importation:
1. Prohibited importation;
2. Restricted importation;
3. Conditionally
importation;

taxed

and/or

duty

free

4. Dutiable Importations; and

5. Duty free importation.
GR: all goodsmay be freely imported into and
exported from the Philippines without need for
import and export permits, clearances or licenses
XPN:when the law
otherwise (Sec. 116).

or

Q: What are
exportation?

of free

goods

regulation

provides

importation

or

A:Goods
of
free
importation
or
exportationare goods or commodities where the
importation or exportation of which is neither
regulated nor prohibited.
Note: 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 (Sec. 116).
Two kinds of prohibited goods:
1. Goods that are absolutely prohibited; and
2. Goods qualifiedly prohibited or restricted.

Q: What is a Custom territory for purpose of tariff

and customs laws?

Note: under the new law; the two types of

prohibited goods are mentioned separately.

A:Customs Territory refers to areas in the

Philippines where customs and tariff laws may be
enforced.

Q: What are goods ofProhibited importation or

exportation?

Q: What are Free zones?

A: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

A: Goods of Prohibited importation or

exportation are those goods the importation or
exportation of which cannot be done under any
circumstances (contrabands)Under Sec. 118,
Q: What are Goods of restricted importation?

A:
Goods
that
are
of
Restricted
Importationsare generally prohibited but with
proper permit/ licenses/ approval by the
appropriate governmental agency, said goods
can be imported.

1. Dynamite, gunpowder, ammunitions and other

explosives, firearms and weapons of war, or parts
thereof;

Examples of
exportation:

3. Lottery and sweepstakes tickets, except

advertisements thereof and lists of drawings
therein

Prohibited

importation

or

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 metalsor 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
Intellectual Property Code and related laws

the

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 Sec. 1113F and thereafter to be
destroyed.
Goods
of
restricted
exportation(Sec 119),

importation

or

GR: Its importation or exportation cannot be

done in the Philippines
XPN:when it is authorized by law and regulation.
Example:

2.Gambling paraphernalia;

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.Relief Consignment(Sec. 120)., Goods such
as food, medicine, equipment and materials for
shelter,

donated

or

leased

to

government

institutions and accredited private entities for

free distribution to or use of victims of calamities
shall

be

treated

and

entered

as

relief

consignment.
Requisites of Relief Consignment:
1. Imported during state of Calamity;
2.Intended for
calamity;and

specific

area

affected

by

3. for the use of the calamity victims in said 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.

Q: What are stores?

A: 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; and
Note: Once said goods are unloaded, they are not
anymore duty-free because it would be
commencement of importation. Example: anchor
3)
Replenishment
of
the
stores.
A
train/vessel/aircraft may requisition goods to be
used as stores.
Conditionally free importation (Sec. 800)
GR: Goods of conditionally free importation will
be exempt from duties and taxes if the conditions
provided by law are complied.
XPN:If said goods are used, bartered or sold
other than the purpose to which they are
imported, they loss their exemption.
XPN to the XPN: 1. sale of the imported
pursuant to a judicial order; or 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.
Case:A fishing vessel of Philippine registry
caught fishes in Taiwan and thereafter dried and
salted therein. Later on, 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 or 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.
Note: 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;

Note: 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.
Note: 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 re-exported
upon completion of the repair, processing or
reconditioning.
Note: 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 into the
Philippines.
e) Medals, badges, cups, and other small goods
bestowed as trophies or prizes, or those 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);
and
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.ThePersonal 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 a

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.They must not be in commercial quantity;
6. They must not be intended for barter, sale or
the like;
7. a. The FOB or FCA value of the goods
mentioned must not be more than P350, 000 if
the returning resident stayed abroad for at least
10 years, he must have availed of this privilege
only once within 10 years;
b. if the returning citizen stayed abroad for less
than 10 years but at least 5 years, the value of
thePersonal and Household effects that could be
imported free from duty is P250,000; or
c. If the stay abroad is less than 5 years,
thePersonal and Household effects that could be
imported free from duty is only up toP150, 000.
Note: the excess is subject to duties and taxes
Just Read: Overlapping of period under RA 10863.
Q: Who are considered as returning residents?
A: These are Filipino citizens who stayed abroad
for at least 6 months.
Q: Suppose the effects were advanced or
improved when the returning citizen is abroad,
would it be subject to DTC?
A: 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 the like;

6) a. The FOB or FCA value of the goods

mentioned must not be more than P350, 000 if
the returning resident stayed abroad for at least
10 years, he must have availed of this privilege
only once within 10 years;
b. if the returning citizen stayed abroad for less
than 10 years but at least 5 years, the value of
thePersonal and Household effects that could be
imported free from duty is P250,000; or
c. If the stay abroad is less than 5 years,
thePersonal and Household effects that could be
imported free from duty is only up toP150, 000.
Note: the excess is subject to duties and taxes
7.The returning resident must be a Filipino
national who must have stayed in a foreign
country for at least 6 months.
BAR(2003): X and His Y wife, Filipino residents,
went to a 3 month 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?
A: No, because they only stayed abroad 3 months
less than what is required by law which is 6
months.
Note: in case of OFWs, they shall have the
privilege to bring in, tax and duty-free, home
appliances and other durables (similar to Personal
and household effects), limited to one of every
kind once in a given calendar year accompanying
them on their return, or arriving within a
reasonable time which, barring unforeseen and
fortuitous events, in no case shall exceed sixty
(60) days after every returning OFW's return upon
presentation of their original passport at the port
of entry. Excess in the no. shall be dutiable.
g)In the case of Residents of the Philippines,
OFWs or other Filipinos while residing abroad or
upon their return to the Philippines, they shall be
allowed to bring in or send to their families or
relatives in the Philippines balikbayan boxes
which shall be exempt from applicable duties and
taxes imposed under the NIRC of 1997, as
amended;
Conditions: 1) balikbayan boxes shall contain
personal and household effects only 2) not in
commercial quantity 3) not intended for barter,
sale or for hire 4) the FCA value of which shall not
exceed one hundred fifty thousand pesos
(150,000.00) 5) can only be availed of only up to
3 times in a calendar year. Excess in the FCA shall
be dutiable.
BAR: X, a balikbayan, has a used car among the
items he brought to the Philippines where he will
resettle 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?
A: The used car cannot qualify as Personal and
household effect, hence, subject to duties. Others
are duty exempt.
l) 1. 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. 2. 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
authenticated;

donation

must

be

duly

3.The donee 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 theDSWD 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?
A: Yes, because the ambulance
distributed for the needy.

cannot

be

p) 1.Importation of goods or salvage from a

vessel abandoned or wrecked outside the
territorial jurisdiction of the Philippines; or 2. Parts
or equipment of a foreign vessel abandoned or
wrecked inside or outside the territorial
jurisdiction of the Philippines.
Note: bringing into the Philippines of parts or
equipment of foreign vessel even if found or
salvaged 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
plantsintended
for
scientific,
experimental
propagation or breeding, and for other botanical,
zoological and national defense purposes
Q: What goods or articles cannot be imported
without authority from the government and duly
authorized institution?
A: Live trees, shoots, plants, moss and bulbs,
tubers and seeds for propagation purposes
Note: for animals imported for breeding purpose,
the following conditions must be complied: 1)
must be restricted animals of recognized breed;
and 2) duly registered in the record or registry
established for that breed; and 3) 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 reimported back to the Philippines.However, their
exportation must be for exhibition, testing and
experimentation, for scientific or educational
purposes;and
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 1) regular
assignment
abroad,
2)
returning
for
reassignment, or 3) returning because said
person had already died, he resigned or he
retired.
Conditions: 1) importation of Personal
household effects including one motor car;

and

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 be 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 4 years during
assignment abroad; and
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.

3. 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.
Note: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 its imposition is to protect local consumers,
manufacturers
Philippine
products,domestic
industries and domestic producers from undue
competition against foreign made product.
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;

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.Marking duty Sec 710

4.Discriminatory duty- sec. 714; and
5.Safeguard duty- Safe guard measures 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.
Note: Cinematographic films are subject to duties
based on lineal meters.

informal entry process; a) Goods of a commercial

nature with Free on Board (FOB) or Free Carrier At
(FCA) >P50, 000; orb) Personal and household
effects or goods, not in commercial quantity,
imported in a passengers baggage or mail.
Additional requirement if imported goods
are entered thru formal entry process: the
importation must be covered by a 1) letter of
credit; 2)any verifiable commercial document
evidencing payment; (Commercial invoice issued
by exporter) or 3) In cases where there is no sale
for export, by any commercial document
indicating commercial value of the imported
goods.
Provisional (Incomplete) Goods Declaration
Note:it may be allowed:

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.All imported goods shall be subject to
lodgement of goods declaration(sec. 201) unless
otherwise provided by RA 10863.
Q: What is lodgement?
A: Lodgement refers to the registration of a
goods declaration with the Bureau (Sec. 102dd).
Q: What is Goods Declaration?
A: 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.
Goods
declaration
forcustoms
bonded
warehousing for admission to the economic zones
3.Goods declaration for conditional importation 4.
Goods declaration for customs transit

1.Whenthe declarant does not have all the

information or supporting documents required to
complete the goods declaration, the lodging of a
provisional
goods
declaration
(Incomplete
supporting document);
2.Itsubstantially
contains
the
necessary
information required by the Bureau; and
3.The declarant undertakes to complete the
information or submit the supporting documents
within forty-five (45) days from the filing of the
provisional goods declaration, which period may
be extended by the Bureau for another forty-five
(45) days for valid reasons (the treatment is as if
the declaration is complete)
Q: Suppose the imported goods were merely
covered by Provisional (Incomplete) Goods
Declaration, can the goods be released from
customs custody?
A: Yes, upon posting of any required security
equivalent to the amount ascertained to be the
applicable duties and taxes (Sec. 403, 3 rd
paragraph). But is required that the importer
must complete the declaration.
Note: 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. Note: It can be
extended upon request.

goods

Note also: The lodgement should be by electronic

means and at any designated customs office
(Sections 407 and 408).

1. the importation should be cleared thru a

formal entry processexcept in the following
importation which can be cleared thru an

Q:May the lodgement of the good declaration be

made prior to the arrival of the goods in the
Philippines?

Requirements
of
lodgementof
declaration for consumption:

A: Yes as provided for under Sec. 409.

Q: Can there be formal or informal entry of
imported goods before lodgement of goods
declaration?
A: 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 and the goods imported
are only covered with one bill of lading or airway
bill.
Note: Split entry is allowed here in the Philippines

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.

Making of and Import Entry

Q: How should the value of the goods be

determined if subject to ad valorem duties?

1. Document filed with the BOC;

A: 6 methods

2. Submission and acceptance of documents

related to an importation; and
3. Procedure of passing goods through customs
house
Q: What is the operative act?
A: It is the filing of the specified documents or
entry form and other documents required by law
or regulation.
Q: What is Import entry internal revenue
declaration (IEIRD)?
Note: import entry is different from IEIRD.
Note also that import entry serves as basis for
payment of advanced duties
Q: How to declare postal items?
A: by filing a special declaration form plus other
supporting documents
Instances which should be declared in the
regular
good
declaration
(Separate
Declaration) Sec. 438
a. If the goods whose value fall within the
level
that
the
commissioner
has
determined to be taxable and thus must
be covered by a goods declaration
b. Prohibited and regulated goods
c. Goods, the exportation of which must be
certified
d. Imported
goods
under
a
customs
procedure other than for consumption
Examination of Imported Goods
GR: Physical examination
Note: conditions for examination under Sec.
420.
XPN: the Bureau may adopt nonintrusive
examination of goods such as the use of x-ray
machines (per parcel of per container).

a.
b.
c.
d.
e.
f.

Transaction value system

Transaction value of identical goods
Transaction value of similar goods
Deductive value
Computed value
Fall-back value

Q: what method shall be used if the goods are

subject to ad valorem?
A: primarily, it is the transaction value system
under Sec. 701.
Note: If the transaction value system is not
applicable, Transaction value of identical goods
shall be applied.
Note: these methods shall be used or applied
sequentially, if prior method is not applicable,
however, the importer may request that if
transaction
value
cannot
be
determined,
computed value may be applied first before
deductive value.
Note: If computed value cannot be applied, then
it is still the deductive value. If the first value
methods are all inapplicable, apply the fall-back
value.
Q: what would be the standard to be used of the
examiner; how should the custom authority make
the classification?
A: Sec. 104 of P.D. no. 1464
Note: in such a case, the maximum rate to be
applied shall not exceed 100%
ad valorem.
Assessment
Sec. 424: Duty of customs officer tasked to
assess imported goods:
a. Classify;
b. Value;
c. Determine the duties and taxes to be paid;
and
d. Prepare and submit assessment report to
the director.

2 kinds of assessment (Sec. 425)

1. Tentative assessment
2. Final assessment
Tentative assessment- if the duties and taxes
initially assessed are disputed by the importer.
Completed:

Upon the re-adjustment base or the tariff

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

Q: May it be refused to the importer even if there

is merely tentative assessment?

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 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
the increased made by the appraiser in
similar
cases
then
pending
reappraisement; or
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.

A: Yes, but the importer must post sufficient

security to cover the applicable duties and taxes
equivalent to the amount that is disputed

Sec. 429: Final Assessment:

Note: 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).

A: 15 days after notice of assessment to importer

or consignee.

Q: if such appraisal, classification or return is

finally passed upon, approved or modified by the
district collector, can it be altered or modified in
any manner?

XPN: when there is fraud

A: GR: it cannot be anymore modified or altered

(Sec. 427)
XPNs:

Q: when does assessment becomes final?

Q: when does assessment becomes conclusive to

all parties?
A: 3 years from the date of final payment of
duties and taxes or upon completion of the post
clearance audit (Sec. 403).

Liquidation:
It is composed of:
a. Final computation and assessment of
duties, taxes, fees and charges due on the
imported article

1. Upon statement of error; this must be made

within 1 year after the payment of duties;

Note: it is the district collector who determines

the final computation.

2. upon request for reappraisal or reclassification

addressed to the commissioner by the district
collector, if the appraisal or classification is
deemed to be low;

Basis for determination: official reports of the

customs officer who made the classification and
assessment.

Note: 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; and
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

b. Payment of duties, taxes, fees and other

charges on the imported article
2 kinds of liquidation (Sections 425-426)
a)Tentative liquidation if future action is still
necessary to determine correct amount of DTC
Example: if there is a need for classifying, recomputation or re-appraisal of DTC.
-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.
Note: imported goods are cleared from customs
duties (if exempt)

Anti-dumping duty (Regulatory tax)

Nature: it is a special duty because the imposition
of which is not just limited to raising revenue but
also for regulatory purposes (taxation as an
implement of police power).
Note that it is imposed in addition to regular
customs duties but its imposition is discretionary
on the part of the tariff commission.
Q: who will make the imposition of the A.D.D.?
A: if the imported article is not agricultural
product, the Sec. of DTI who will impose of the
A.D.D. upon recommendation of the Tariff
commission. However, if it is an agricultural
product, it is the Sec. agricultural that will impose
upon
the
recommendation
of
the
tariff
commission.
Q: What should be the amount to be imposed? A:
An amount equal to the margin of dumping
(difference of the normal value of the goods in
the ordinary course of trade in the country of
origin and the value as imported in the
Philippines).
Note: The Tariff Commissioner may consider the
imposition of the A.D.D. based on the welfare of
consumers, the general public and other local
industries. However, if he finds that the
imposition of the ADD would be adverse to the
consuming public, general public or related local
industries, in such a case he may recommend not
to impose.
Q: May the anti-dumping duty be imposed less
than the margin of dumping?
A: Yes, if it is adequate to remove the injury
suffered (Tariff code of 1978)
Q: For how long may the ADD be imposed? As
long as and to the extent necessary to counteract
the dumping but as a general rule the imposition
of the ADD should not exceed the period of 5
years counted from the imposition subject to the
review of the TC and when there is recurring
injury, it may be extended.

A: No, it is not suspended. However, if there is

already an appealed case with the CTA, it may
issue an injunction for the collection of ADD.
Countervailing duty (CD)
Note: the customs modernization and tariff act
does not provide for the imposition of ADD and
CD. However, it adopts the provision of the RA
8751 which provides the imposition of the said
duties.
Countervailing is present if a product/
commodity/ article of commerce is granted
directly or indirectly by the government of the
country of origin or export of any kind or form of
subsidy upon production, manufacture or
exportation of the product and the importation of
said products has caused or threatened to cause
material injury to a domestic industries or has
materially retarded the growth or prevents the
establishment
of
domestic
industries
as
determined by the TC.
Q: Who shall impose the Countervailing duty? A:
Same as with ADD
Rationale for theimposition:Due to the subsidy,
the importer or manufacturer will incur lesser
cost in the manufacturing and with that they can
export the product at a lesser cost as compared
to similar products locally produce. Subsequent
importation of similar products, CA will also be
imposed. It is imposed to in addition to regular
customs duties
Q: How much is the amount to be imposed?
A: equal to the amount of subsidy
Remedy of the importer: same as with the ADD
Q: For how long shall the CA be imposed?
A: for as long as and to the extent necessary to
counteract the subsidization which is causing or
threatening to cause material injury. The TC may
make a review for the need of continued
imposition of CV upon its own initiative or upon
the direction of the Sec. of DTI or agriculture or
an interested party may file a petition with the
Sec. of DTI and Agriculture for the review of the
imposition. After finding that the imposition is no
longer necessary, the TC may recommend to the
Secretaries the discontinuation of the imposition
of the CV.
Marking duty

Q: what is the remedy of the importer?

Nature: same with ADD and CV

A: the importer may file a petition for review with

the CTA with in a period of 30 days from the date
of receipt of notice of the imposition of ADD(RA
8752).

Sec 710- requires the proper marking of goods

and their container if imported in the Philippines.
If not proper the MD will apply.

Q: Upontimely filing of the petition for review, will

it stay the imposition and collection?

Q: How to mark?

A: goods of foreign origin or at least their

containers should be conspicuously marked as
legibly and indelibly and permanently as the
nature of the goods or container allow in such a
manner that it will indicate to the ultimate
purchaser the name of the country of origin of the
goods.
Q: in what languages?
A: in any of the official languages in the
Philippines. It may be Filipino, English or Spanish.
Purpose: to protect local consumers from being
mislead of the country of origin of the imported
goods
Note: it is also in addition to the regular customs
duties.
Note also: Noncompliance warrants automatic
imposition of Marking duty from the moment
importation is commenced.
Q: what are the legal effects if the goods
imported in the Philippines is improperly marked?
A:
1. it will be subject to marking duty at the
rate of 5% of the dutiable value and it
accrues from the moment importation is
commenced;
2. The importer or the owner will have to be
notified of the Bureau of customs that he
should properly mark the imported goods
within 30 days from notice;
3. The imported goods cannot be released
from customs custody unless the req.
under Sec. 710 is complied and the MD is
paid.
Q: suppose the owner or the importer of the
imported goods fails to mark the imported goods,
what would be the legal effect?
A: the imported goods will be considered
abandoned by the importer and it will be subject
to the disposition of the BOC as in the case of
abandoned importation. It may be sold if fit for
human consumption otherwise it will be
destroyed
Exceptions to the rule of proper marking:
1. Goods of incapable of being marked. e.g.
nails, needles although the container may
be marked
2. Goods which are already known to the
local customers as to their origin. e.g.
articles produced from china
3. Articles which have been produced for
more than 20 years
Q: what is the remedy of the importer against the
imposition of marking duty?

A: to re-export the article or destruction of the

imported goods in the presence of the officers of
the BOC and it must be done prior to the
liquidation of DTFC.
Q: suppose the importer is able to mark properly
his imported article within 30 days from notice of
BOC, will the importer still be held liable for MD?
A: Yes, because the marking duties accrue from
the moment importation commences.
Q: who imposes the marking duty?
A: the commissioner of customs
Retaliatory duties(Discriminatory duty)
Nature: it is imposed in retaliation for
discrimination being committed by another
country (Sec. 714)
Q: when is this duty beingimpose?
A:
1. If an article exported from Philippines is
being subjected directly or indirectly to
unreasonable charge, exaction, regulation
or limitation by another country and such
is not equally enforced against like articles
of another country (Discriminatory duty);
and
2. Such foreign country enforces or passed a
law, regulation or practice relative to
customs
which
places
Philippine
commerce at a disadvantage as compared
as to the commerce of other foreign
countries.
Q: who has the authority to impose this duty?
A: the president of the Philippines upon the
recommendation of the tariff commission.
Q: how much is the amount of DD that could be
imposed?
A: the president of the Philippines is authorized to
impose new or additional duties as discriminatory
duty in an amount not exceeding 100% ad
valorem if public interest requires.
Q: What may the president of the Philippines if
the discrimination is continued, maintained or
increased?
A: Ban the importation of goods coming from that
foreign country practicing discrimination or ban
goods imported into the Philippines carried by
vessels of that foreign country practicing
discriminations.
Q: suppose after the imposition of the Ban, still
products coming from that foreign country is
imported in the Philippines, what will the recourse
of the government?

A: it will be subject said goods to seizure and

forfeiture.
Q: For how long may the discriminatory duty be
imposed?
A: for as long as public interest requires or if not
president may amend the proclamation imposing
DD
Safeguard duty
Note: it is not found in CMTA but it is provided for
by RA 8800 but it is being adopted by CMTA as
expressed under Section 712.
Different kinds of Safeguard Measures Duty
1. GENERAL SM
2. Special SM
Q: what are the circumstances required to be
present so that this SMD will apply?
A: There must be a finding by the TC that a
product is being imported in the Philippines in
increased quantity so as to substantial cause
serious injury or threat to domestic industry.
Note: as compared to ADD where the cost of the
goods imported is lesser, here importation is in
increased quantity.
Requisites to justify the imposition of the
GSM
1. There must be increased import;
2. There must serious injury or threat to
domestic industry; and
3. There must be a causal link between the
increased importation and serious injury or
threat to domestic industry.
Note: in the case of non-agricultural product,
the application of GSM must be as public
interest dictates.
Q: what are the different safeguard measures
under the safeguard measures act?
1. Increase in the duty of the imported
product;
2. Imposition of a duty in an imported
product;
3. Decrease in the tariff rate Quota of the
imported product;
4. Imposition of the tariff rate quota on the
product;
5. Modification
of
any
quantitative
restriction;
6. Imposition of quantitation restriction for
the importation of the product;
7. Adjustment measures may also be
imposed including trade adjustment
assistance; and
8. Combination
of
the
aforementioned
safeguard measures.
Q: who imposes the SMD?

A: the Sec. of Agriculture in cases of

agricultural products or Sec. of DTI in cases of
non-agricultural products.
Q: What are the limitations of the power or
authority of the Sec. of Agriculture or Sec. of
DTI to impose SMD?
A: SGM cannot be imposed originated from a
developing country if the share of the product
from the developing country in the Philippine
imports is less than 3% provided that the
developing country with less than 3% share in
collective accounts for imports into the
Philippines is not more than 9% of the total
Philippine imports.
Q: what is the remedy of the importer if his
importation is subject to SMD?
A: appeal to the CTA by way of petition of
review within a period of 30 days from the
time the owner receives the decision
enforcing the safeguard measures then to SC.
Flexible clause on imports (Sec.1608)
Note: it is provided for in pursuance of sec. 28,
art 6 of the constitution.
The following are the powers granted to the
President upon the recommendation of NEDA:
1. To increase, reduce or remove existing
protective rates of import including any
necessary change in classification;
Note: in no case shall the increased rate be
higher than 100% advalorem.
2. Establish import quotas or to ban
importation of any commodity as may be
necessary;
3. To impose additional duties on all imports
not exceeding 10% ad valorem whenever
necessary; and
4. To modify the forms of duty whether ad
valorem or specific.
Note: grounds to exercise these powers are
general welfare and national security under
section 1608 but before interest of national
economy is included.
Limitations on said powers:
1. The powers under the flexible tariff clause
can only be exercised by the president
when congress is not in session;
2. If validly exercised by the president, the
congress may withdraw the power by
joint resolution;
Garcia vs. Exec. Secretary (211 SCRA 227)
The Supreme Court held that the president may
also exercise powers under the flexible tariff
clause in order to protect domestic consumer

because the grounds under sec. 1608 is not

limited to the protection of local industries but
may include the protection of local consumers
who after all constitutes the bulk of the
population.
Q: When will the order of president in exercising
any powers under flexible tariff clause takes
effect?
A: as a general, it shall take effect 30 days upon
promulgation except an order imposing additional
duty.
Functions of the Bureau of Customs:
1. Assessment and collection of customs
revenues from imported goods and other
Dues, fees, charges, penalties accruing
under the CMTA;
2. Simplification
and
harmonization
of
customs
procedures
to
facilitate
movement of goods in international trade
3. Border control to prevent entry of
smuggled goods
4. Prevention and suppression of smuggling
(before this duty is given to the Philippine
coast guard)
5. Facilitation and security of international
trade in commerce
6. Supervision and control over the entrance
and clearance of vessels and aircrafts
engaged in foreign commerce;
7. Supervision and control over handling of
foreign mails (it possible that goods may
be imported thrumails and to protect
revenues and prevent smuggling)
8. Supervision and control over all imports
and export cargoes landed or stored in
piers, airports, terminal facilities including
yards and freight stations.
9. Exercise of exclusive original jurisdiction
over forfeiture cases under this act
10. Enforcement of this act and all other laws,
rules and regulations relating to tariff and
customs administration
Territorial jurisdiction of the BOC
It has Jurisdiction over all seas within the
Philippine territory including all coast, airports,
bays, rivers and in land waters whether navigable
or not.
Asaali vs. Com. Of customs
Several bunk boats loaded with cigarettes are
sailing from Borneo to tawi-tawi but before they
could enter Philippine territory, they were
apprehended by customs authority and the boats
and cigarettes are subject to seizure and
forfeiture. The court ruled here that the direction
of the boat is certain that it is towards tawi-tawi.
The state has the power to enforce its custom
laws even beyond its territory if it is necessary to
protect its laws and regulations.

Extraterritorial jurisdiction of the BOC(Sec.

300)
The BOC hasextraterritorial jurisdiction that is
when a vessel or aircraft becomes subject to
seizure for violations of customs laws, a pursuit of
said vessel or aircraft begun within the Territorial
waters of the Philippines may be continued even
beyond the Territorial waters or airspace of the
Philippines and the vessel or aircraft may be
seized provided it committed violation of customs
laws within the Territory of the Philippines
(Doctrine of hot pursuit of vessel or
aircraft).
Doctrine of hot pursuit of imported goods
if imported goods are subject to seizure for
violation of customs laws or rules or regulations
of the Philippines ,said goods may be pursued by
the BOC even during transport by water, land or
by air in order to effective enforce the customs
laws of the Philippines.
Note: Carrara Marble v. Com. of Customs and
Vierneza vs. Comm. Of Customs
Q: what is the extent of the BOCs jurisdiction
over the Philippine territorial sea?
A: Customs zone is the area of the Philippine
territorial sea where the BOC exercise its
jurisdiction which is12nm measured from the
baseline (Sec. 20 of UNCLOS).
Q: Who has exclusive jurisdiction over imported
goods or goods for exportation?
A: Primarily the BOC or the Sec. of Finance if
importation or exportation is subject to review by
secretary of finance(Sec. 1137)
Note: As a rule, a court cannot issue an order or
decision affecting the importation or exportation
until administrative remedies has been exhausted
(Zunio vs. Cabredo).
Q: what is the nature of Economic Zones (Eco
Zones)?
A: They are places specially designated for the
location of certain industries or business granted
tax exemption privileges or tax holidays. They are
established to promote industrial activities within
the zone especially exports.
Note: It is considered separate customs territory
even if geographically located in the Philippines.
As a consequence, the sales of goods by the
suppliers from outside the borders of the
ecozones to business inside the ecozones are
considered as exports. Sales by industries inside
the ecozones to those outside are considered
imports subject to DTF and other charges.
Q: What is the basic rule with respect to the
BOCs control over goods imported or to be
exported?

A: All goods including the means of transports

leaving or entering the customs territory WON
subject to DTFC shall be subject to the control of
BOC to ensure compliance of CMTA (Sec. 301).
Note: the president, through an executive order,
has the power toplace an area, premise or
infrastructure under the jurisdiction of BOC
including the power to transfer overstaying
cargoes from a port terminal or in land depot or
terminal as provided under Sec. 304 of CMTA.
The Power of special surveillance by the
BOC-it is the power to conduct special
surveillance to vessels or aircrafts entering
Philippine territory including imported goods
entering thru the customs office(Sec. 306).
Measures to protect customs revenue
1. Alert Order a written order issued by a
customs officer authorized by the Commissioner
of Customs. Said order gives information
regarding the possible non-compliance with CMTA
regarding an imported good.
Effects if an alert order is issued: a) suspension of
the processing of the goods declaration; and b)

suspension of
examination.

the

physical

or

non-intrusive

Note: Within 48 hours or within 24 hours (if the

goods are perishable) from inspection, the officer
who issued the alert order must recommend the
suspension of the processing of the goods in case
of negative finding or recommend or the issuance
of warrant of seizure or detention if there is
discrepancy between the goods declaration and
actual goods found upon inspection.
Under sec. 214, certain officers or employees of
BOC are given the power to exercise police
authority to exercise seizure, searches and arrest.