Home » Across Borders » Promoting Cost Efficiency and Customs Compliance thru SGL
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Designed to facilitate trade and promote compliance among the major importers, the Bureau of Customs (BoC) first introduced the Super Green Lane (SGL) import processing facility to the top 100 importers in year 2000.

Under the program, an importer is allowed the paperless processing of the imported cargo, resulting in the release of the goods at the earliest possible time after the electronic filing of the import entry. Submission of the manual copies of the import documents are made after the goods have been released from customs custody.

Under the rules, an importer may avail of the privilege under the program only after proper accreditation of the company and prior approval of a list of importables.

New SGL Rates – The BoC has recently issued new rules on the SGL, which effectively allows any importer to apply for accreditation and which further reduces the cost of releasing goods from customs. The revised rules are now embodied in CMO 6-2003 and CAO 28-2003, with the new rates as follows:

FOB Value Fees Below
US$5,000 – PhP 500.00
US$5,001 to $100,000 – PhP 1,000.00
US$100,001 to $200,000 – PhP 1,500.00
US$200,001 to $500,000 – PhP 2,000.00
Above US$500,000 – PhP 2,500.00

Benefits to the Trading Community – Among the benefits provided under the program are as follows:

  1. Exemption from selectivity system at the customs border;
  2. No face-to-face interaction with BOC from filing of import entry to release of cargo;
  3. Early manifest filing by shipping lines;
  4. When necessary, physical inspection conducted only at importer’s premises; and
  5. Mission Orders or “Alerts” can only be issued only by Commissioner.

Exemption from the customs selectivity system simply means that upon electronic filing of the import entry, customs will automatically process the shipment and immediately allow release of the imported goods after payment of taxes and duties. The goods are exempted from regular document check and physical inspection.

So long as the import entry declaration is proper and in the absence of any error, the shipment is also exempted from valuation and classification issues being raised against it. Thus, under the system, traders are assured of hassle-free and timely release of the imported goods.

In addition and based on the experience of current SGL members, substantial savings are generated as a result of lower customs processing expenses.

Requirements and Procedures for Accreditation – In contrast to the old rules, the requirements for accreditation under the program have become less stringent, allowing any bona fide importer to apply for accreditation. In particular, the new requirements for an applicant under the program are as follows:

  1. Any BOC-registered importer (even those outside top 1000);
  2. At least 1 year of operation at time of filing of the application;
  3. Regular importation of same articles;
  4. Importer accredited to use remote lodgment facilities (EDI user through VAN service providers); and
  5. Willingness to undergo Voluntary Compliance Audit Part of the accreditation process is the submission of the list of regular importables.

These list of articles must be freely importable (or if regulated, covered by continuing Import Authority) and bound for domestic consumption (not for warehousing). The filing of the import entry must be done through the use of an EDI lodgment facility (ref. CMO 22-99).

To apply for accreditation, an importer must submit a duly-accomplished application form to the SGL Secretariat together with supporting documents. The SGL secretariat will then review the application and request for a meeting with the applicant.

Assuming that the application is in order, the secretariat will make a recommendation to the SGL Committee. Once the application is approved, BoC will now issue a Certificate of Accreditation.

Promoting Compliance through SGL – Prior to accreditation as an SGL member, an importer must express its willingness to undergo voluntary compliance audit. In addition, an SGL member may be randomly selected for enforced compliance audit.

Notwithstanding the above situation, accreditation under the SGL program should enhance the compliance of an importer for the following reasons. First, the use of the EDI lodgment facility will help the company comply with the record keeping requirements under the customs audit system and will ensure that taxes and duties are properly paid and actually received by customs.

Second, BoC will have difficulty raising issues against the valuation and tariff classification (pre-approved by the SGL Committee during the accreditation process) of the imported goods in case of a customs audit unless there are clear and valid grounds. Finally, the use of the electronic system allows the importer to have better control of customs operations through electronic monitoring and supervision of the customs processes.

An international trade and customs consultant, and licensed customs broker, the author is a Fellow of WTI.PH and Partner of DLUGMS Law Office. Please contact him at aouvero@dlugms.com or (632) 4050021 / 29 for your comments.

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