Home » Across Borders » e2m Irregularities and Updates

IT has been six months since e2m (i.e., e-manifest system) was first implemented at the Manila International Container Port (MICP) and Port of Manila (POM) by the Bureau of Customs (BOC). Since then, significant improvements have been observed in the area of revenue collections and also in the clearance time of most shipments. One continuing problem though for carriers and forwarders is the penalty system imposed for the late submission of manifest information.

E2M Illogic

Under existing rules, carriers are required to submit the e-IFM (master bills of lading of shipments consigned to ultimate and nominal consignees) 12 hours prior to vessel arrival. In the case of forwarders and NVOCCs, the e-CCM (house bills of lading of shipments consigned to the ultimate consignees de-grouped/split from the master bills of lading of shipments whose consignees are just nominal such as banks, forwarders and consolidators) must be submitted within 6 hours prior to arrival.

The penalties for failure to submit within the required period is graduated – Php10,000 (1st offense), Php20,000 (2nd offense) and Php30,000 (3rd offense).

The system automatically prevents carriers and forwarders from submitting beyond the period. Also, forwarders cannot submit the e-CCM unless carriers are able to submit the e-IFM first. Late submissions are accepted only after manual intervention and after payment of penalties.

This manual intervention by customs personnel is simply irrational as it totally defeats the purpose of automation. The system should automatically allow even late submissions considering that penalties will anyway be imposed against carriers and forwarders. The penalty should be treated as enough sanction, without having to go through the complicated and more expensive process of manual customs intervention.

Penalties without receipts

In recent months, the customs servers have intermittently been down, mostly after office hours and during weekends. The downtime results in late submission of e-IFMs and e-CCMs by carriers and forwarders. On some occasions, forwarders are unable to submit the e-CCM for the following reasons:

– late submission of the e-IFM by carriers, or
– late (or incomplete information) submission of arrival notice by carriers to forwarders.

Notwithstanding the above situations, BOC personnel at both MICP and POM have been reported to exact penalties, mostly without official receipts and worse, imposing the maximum amount of PhP30,000 (designed for 3rd offense), again often without official receipts.

As one forwarder noted, the current system has evolved into some sort of a ‘booby trap’ for collecting unreasonable and unreceipted charges from the freight forwarding industry. These unaccounted charges from the industry have been estimated to amount to millions of pesos in recent months.

Carriers vs. forwarders

We earlier mentioned that one reason for late submission by forwarders is the failure of carriers to submit the arrival notice on time – or to provide complete information. The information in the arrival notice provided by carriers to forwarders is part of the information contained in the e-CCM.

Carriers and forwarders are currently disputing over the need to submit timely and accurate arrival notices. Consultations are accordingly ongoing among the industry associations of the carriers and the forwarders.

Other updates

The BOC has drafted revised rules on the bulk and break bulk cargo system. A public consultation will soon be conducted. Importers, customs brokers and forwarders should study the revised rules as these will likely result in additional costs in the importation business.

As published in major newspapers last week, a Joint Order has been issued by the Department of Finance, Bureau of Internal Revenue and BOC regarding the use of book values on importation of vehicles. This administrative regulation seems to conflict with an existing law which expressly prohibits the use of book values or minimum customs values for purposes of customs valuations.

The author is the legal director of AFPI, PISFA and PUC. He is a lecturer on logistics, indirect tax and customs, and a trainor of Ateneo Graduate School and BayanTrade Academy on International Supply Chain Management. Please contact agatonuvero@yahoo.com for your comments.

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