THE Bureau of Customs (BOC) has recently issued several guidelines that will directly impact the present manual system for accrediting and verifying entities (importers, customs brokers, forwarders, NVOCC, airlines, etc.) dealing with customs.
CMO 39-2008 provides the guidelines on electronic accreditation of these entities under the Client Profile Registration System (CPRS). CPRS is scheduled for implementation starting February 2008.
On the other hand, CMO 1-2009 requires the accreditation of the Information Validation Service Provider (IVSP) — third party service providers that will assist BOC in the verification of information submitted through the CPRS.
What is CPRS?
CPRS is part of the ongoing customs modernization program and will involve the online submission of the profile and data through existing VASPs of all entities dealing with BOC. For importers, renewal for accreditation will now be filed electronically through the existing VASPs. Importers with valid accreditation will also be required to register under the CPRS.
Prior to the issuance of CMO 39-2008, the accreditation of importers required the manual submission of application documents (e.g. registration papers with BIR, SEC, SSS, local government units, etc.) and the physical inspection of the office or warehouse of the importer. The new system includes the submission of digital photos, electronic signatures and other necessary documents. For custom brokers, the CPRS will require the use of the digital signature in the filing an import declaration.
While the submission of the profile will be done electronically, the accredited IVSP will conduct a review and verification of the information submitted. When necessary and under certain parameters, the IVSP will conduct physical inspection of the registering entities.
Who’s covered by the CPRS?
All customs brokers, importers, warehouse operators, surety companies, airport transit facilities and off dock CY/CFS shall register directly with the CPRS through VASP. For other entities transacting with BOC, these companies will register with the CPRS through the accrediting government agencies as follows:
– Airlines (CAB)
– Exporters (BOI, PEZA, CDC, SBMA, etc.)
– Other Exporters (Philexport)
– Arrastre Operators (PPA)
– Authorize Agent Banks
– Forwarders / Consolidators / NVOCCs (PSB or CAB)
Information Validation Service Provider
Under CMO 1-2009, customs will accredit IVSPs to perform the task of verifying the completeness and accuracy of the information submitted by the stakeholders. The ISVP shall likewise provide compliance risk assessment prior to the accreditation of the stakeholder. Specifically, CMO 1-2009 provides the following scope of service for the IVSP:
– Design and implement an Information Validation System (IVS) which includes the development of an Information Validation Report (IVR);
– Develop and implement procedures for the validation of client profile information;
– Develop a Client Risk Assessment System (CRAS);
– Develop a database to be used by BOC in periodic risk assessments on subject importers/clients/stakeholders;
– Integrate the services and the systems developed with the computerized e2m Customs System as specified by the MISTG; and
– Perform such other services required by the BOC as defined in the Terms of Reference to be prepared by the BOC.
Implementation Issues
Stakeholders are raising concerns on the possible financial impact of these programs. An added concern is the need to maintain free competition among the providers. Obviously, stakeholders will expect better services and competitive prices when there are more service providers. As has always been the case, a single provider will most likely result in monopoly pricing and poor services.
Given that, stakeholders will have to ensure that the terms of reference for the selection of the IVSP is not designed, wittingly or unwittingly, to favor or disqualify any of the applicants. Strict requirements for accreditation may result in a single service provider and the absence of competition. At the very least, BOC should accredit 3 service providers similar to the present VASP system.
The author is an international trade, indirect tax (customs) and supply chain expert. He is the Editorial Board Chairman of Asia Customs & Trade, an online portal on customs and trade developments affecting global trade and customs compliance in Asia. He was also Bureau of Customs Deputy Commissioner for Assessment and Operations Coordinating Group (2013-2016). For questions, please email at agatonuvero@yahoo.com and agatonuvero@customstrade.asia
