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BOC sets rules on negotiated sale of forfeited goods

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The Bureau of Customs (BOC) has issued procedures for the disposition of abandoned and forfeited goods through negotiated sale.

Customs Memorandum Order (CMO) No. 26-2020 implements Customs Administrative Order (CAO) No. 03-2020, which provides BOC’s new rules and procedures for all modes of disposition of seized, abandoned, and forfeited goods.

READ: BOC simplifies rules for disposing seized, abandoned and forfeited goods

Aside from negotiated sale, other modes of disposition of seized, abandoned, and forfeited goods include public auction, donation, official use of BOC, re-exportation, destruction or condemnation, and turnover to the proper government agency.

CMO 26-2020 took effect on October 9.

Goods that may be sold via negotiated sale are those which remain unsold after at least two public biddings, and are not suitable either for BOC’s official use or for donation.

The negotiated sale should be carried out with the approval of the finance secretary and in the presence of a Commission on Audit representative.

Under CAO 03-2020, prohibited from joining a negotiated sale are employees or officials of BOC; importers or consignees of the auctioned goods; defaulting offerors unable to comply with the payment requirements and those disqualified by ports for other infractions in the last 12 months; and offerors or their authorized representatives who are not present during the opening of the sealed offers, or who fail to comply with the documentary requirements.

A negotiated sale is subject to the approval or disapproval of the Department of Finance, BOC’s mother agency.

Under CMO 26-2020, a Negotiated Sale Committee (NSC) is created to implement the provisions of CAO 03-2020 on the conduct of negotiated sale. The NSC shall also conduct ocular inspection of the sale lots or items, and may reject or consider offers based on what is most advantageous to the interest of the government.

No minimum price will be set for offers, but CMO 26-2020 notes the government reserves the right to reject or accept offers, and to waive and require formalities.

A participant whose offer is accepted must pay a guarantee cash deposit equivalent to 20% of the offer within 24 hours of receipt of the NSC’s notice of acceptance.

The remaining 80% of the offer should be paid in full within 48 hours from receipt of the NSC notice indicating the approval of the finance secretary. If the offer is rejected by the finance secretary, the guarantee cash deposit will be refunded 15 calendar days from receipt by the offeror of the notice of disapproval.

A negotiated sale is declared failed when there is no offer, or when the highest offeror fails to comply with CAO 03-2020 requirements of. It is also considered failed when the offer is disapproved or rejected by the DOF. – Roumina Pablo


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