Home » Across Borders » House Bill No. 5342: Customs and Trade Modernization Act
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A BILL entitled “An Act to Prescribe the ‘Customs and Tariff Modernization Act of 2008’ and for other purposes” has recently been filed in Congress.

Authored by Congressman Rufus Rodriguez, House Bill No. 5342 was referred on first reading to the Committee on Ways and Means last October 10, 2008. A committee hearing is now being scheduled for the deliberation of the bill.

Source of the Proposed Law

The proposed legislation is based on a draft prepared and studied for more than 6 months through numerous workshops conducted by the Bureau of Customs (BOC) together with the private sector. As prepared, the bill has been mainly sourced from the following:

  • Books I and II of the Tariff and Customs Code of the Philippines (TCCP) as amended
  • Inputs from the Technical Working Groups and Discussion Meetings
  • Revised Kyoto Convention (General and Specific Annexes)
  • BOC Wish List
  • Pending Anti-Smuggling Bills
  • International Agreements and Best Practices

Proposed Revisions

In Title I of the bill, new provisions are provided on the following:

  • Definition of the Declarant
  • Rights and Responsibilities of the Declarant
  • Definition of Prohibited and Regulated Importations and Exportations
  • Procedure for Lodgment and Registration of Goods Declaration
  • Special Procedures for Authorized Persons
  • Procedures for Examination of the Goods
  • Treatment of Errors in Goods Declaration
  • Procedures of the Tentative Release of Goods
  • Extension of Period for Abandonment
  • Procedures for the Disposition of Abandoned Goods
  • Procedures for allowing Deferred Payment for Government Importation
  • Expanded Provision for the Refund of Duties and Taxes
  • Treatment of Third Parties
  • Application of Information and Communication Technology
  • Issuance of Decisions and Ruling

In Title II, the following were proposed:

  • Number of deputy commissioner has been left open
  • “Trade Facilitation” added as new customs function
  • Provision on the de minimis value below which no duty shall be collected

In Title III, a new provision authorizing customs to establish temporary storage prior to goods declaration. In Title IV, the following were proposed:

  • The value requiring the filing of formal entry increased to P50 thousand FOB or FCA
  • Request for classification & valuation ruling revised
  • General rule on the manner of examination laid down including the examination thru non-intrusive inspection
  • Presence of importer/broker not required during inspection
  • New provisions on Travellers, Passenger Baggage, Postal Mail & Relief Consignment provided

In Title V of the bill, a new provision on export clearance formalities has been provided. In Title VI, there is a new definition of customs transit and transhipment. Title VII has been reserved for the trade remedy measures (dumping, safeguards and countervailing duties).

Title VIII has set the provision on the posing of guarantees and securities to not more than 100% of the tax and duty payable. In addition, the period for storage in customs bonded warehouses has been set to a minimum of 1 year, except for perishable items which is 6 months. New provisions on temporary storage areas are also provided.

In Title IX, a prescription period has been provided for claims for refund and drawback. Title X now clearly defines the persons that can exercise police authority. Also a provision for a ‘forfeiture fund’ has been provided. Title XI has expanded the coverage of customs audit to include persons other than importers. Customs has also been empowered to issue summons in the course of the audit. However, the penalty regime in case of adverse audit findings has been substantially reduced.

Title XII refers to fraud investigation and prosecution while Title XIII defines the third parties dealing with customs (customs brokers, forwarders, airlines, shipping lines, etc.). Title XIV to XVI provides for the administrative rules and procedures. Title XIX refers to the tariff schedule and the harmonized system.

The author is an international trade consultant and a licensed customs broker. He is a lecturer on logistics, indirect tax and customs, and a lecturer of Ateneo and BayanTrade on Supply Chain Management. Please contact agatonuvero@yahoo.com for your comments.

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