PART of international trade and customs practices is the concept of Temporary Imports or Temporary Admissions, which are the general terms used to refer to articles that are imported temporarily under certain conditions but to be subsequently re-exported at a future time. The international agreements governing such importations are provided in the ATA Carnet and the Revised Kyoto Convention (RKC).
Benefits of Temporary Admissions. While the Philippines is not a signatory to both international agreements, there are many reasons why importers and exporters should be familiar with these trading practices. For one, many of the provisions of both agreements are provided in Section 105 (Conditionally-Free Importations) of the Tariff and Customs Code of the Philippines, as amended (TCCP). Second, many countries have long adopted these agreements into their national legislation and exports to these countries may be covered by any of these trading practices. RKC alone has at least 46 signatories while ATA Carnets are recognized in about 66 countries and territories. The Philippine government has already officially announced that it will soon accede to the RKC.
The RKC, otherwise known as the International Convention on the Simplification and Harmonization of Customs Procedures (Kyoto Convention), defines temporary admission as the the customs procedure under which certain goods can be brought into a customs territory conditionally relieved totally or partially from payment of import duties and taxes; such goods must be imported for a specific purpose and must be intended for re-exportation within a specified period and without having undergone any change except normal depreciation due to the use made of them.
RKC Standards. The RKC provides standards for implementation by countries that are signatories to the convention. Among these standards are as follows:
- National legislation shall enumerate the cases in which temporary admission may be granted.
- Goods temporarily admitted shall be afforded total conditional relief from import duties and taxes, except for those cases where national legislation specifies that relief may be only partial.
- Temporary admission shall not be limited to goods imported directly from abroad, but shall also be granted for goods already placed under another Customs procedure.
- Temporary admission should be granted without regard to the country of origin of the goods, the country from which they arrived or their country of destination.
- Temporarily admitted goods shall be allowed to undergo operations necessary for their preservation during their stay in the Customs territory.
- Returning residents shall be permitted to re-import free of import duties and taxes personal effects and their means of transport for private use which they took with them at the time of their departure from the country and which were in free circulation in that country.
- Customs shall not require a customs document or security for the temporary admission of personal effects of non-residents unless they exceed, in value or quantity, the limits laid down in national legislation; or they are deemed by the customs to be a risk to the revenue.
Inward and Outward Processing. The RKC likewise provides standards for the temporary exportation of articles that are intended for manufacturing, processing or repair and subsequent importation. The convention provides that goods admitted for inward processing shall be afforded total conditional relief from import duties and taxes. However, import duties and taxes may be collected on any products, including waste, deriving from the processing or manufacturing of goods admitted for inward processing that are not exported or treated in such a way as to render them commercially valueless. Also, it is required that national legislation shall enumerate the cases in which prior authorization is required for outward processing and specify the authorities empowered to grant such authorization.
ATA Carnet. ATA Carnet is basically an international customs document that is used by travelers temporarily to import certain goods into a country without having to engage in the customs formalities usually required for the importation of goods, and without having to pay duty or value-added taxes for such goods. A Carnet is a security that participating countries accept as a guarantee for the non payment of customs duties that may become due on goods temporarily imported and not exported as required. ATA is the acronym for the combined French and English words Admission Temporaire-Temporary Admission.
Generally, a carnet is valid for one year from the date of issuance and shall normally cover goods such as: commercial samples; professional equipment; and articles for presentation or use at trade fairs, shows, exhibitions and the like. A carnet, however, does not cover perishable or consumable items, or goods for processing or repair. Articles specifically listed on an ATA carnet can be imported to and exported from any of the member countries as many times as needed during the one-year life of the carnet.
The author is an international trade and customs consultant, and a licensed customs broker. He is a lecturer on logistics, indirect tax, customs and supply chain. Please contact email@example.com for your comments.