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The Philippines will still not be able to implement the European Union’s (EU) Registered Exporter (REX) system this month as earlier committed, according to the Department of Trade and Industry (DTI).

REX is the new system of certification of origin of goods that the EU is progressively introducing for its preferential trade arrangements. First applied to the Generalised System of Preferences (GSP) program from January 1, 2017, the REX will eventually completely replace the current system of origin certification that is based on certificates of origin issued by government authorities and on invoice declarations made out under certain conditions by economic operators.

The global transition period from the current system of origin certification to the REX system started on January 1, 2017 and will last until June 30, 2020 at the latest. The Philippines had earlier notified that it would apply the REX system on January 1, 2019.

Under REX, economic operators will be the ones to make “statements on origin.” To be entitled to do this, an economic operator will have to register in the database of his competent authorities to become a registered exporter. The European Commission provides and maintains the REX system, and GSP beneficiary countries do not have to develop the system themselves.

The REX system is supported by an IT system, basically a database in which competent authorities, in the Philippines’ case BOC, will register their exporters who intend to export products under a preferential trade arrangement and will keep their data up to date.

2 pre-requisites unmet

DTI in an advisory to exporters posted on its website said the Bureau of Customs (BOC), the country’s competent authority, is still completing the two prerequisites for applying the REX system.

While the REX system is not yet applied in the Philippines, DTI said BOC will continue to issue Form A certificates while Philippine exporters of low-value GSP exports (EUR6,000 or less) will continue to issue invoice declaration. The Philippines is currently a beneficiary of the GSP Plus (GSP+) program, a component of EU’s GSP program for developing countries that allows duty- and tax-free access for Philippine products to the European market.

The “effective application date of the REX system” in the Philippines is the date when BOC communicates officially to the European Commission all the necessary information, DTI noted.

From January 1, 2019 and until such time that BOC is still unable to submit the prerequisites, the global transition period provided by the EU will allow BOC to continue issuing the GSP Form A. Philippine exporters are requested to advise their EU importers regarding the global transition period.

Once the Philippines implements the REX system, the self-certification on the statements on origin by the Philippine exporters themselves will progressively, for a maximum of 1.5 years, replace the certificates of origin Form A issued by BOC and invoice declarations made out by economic operators of low-value GSP exports, and will completely replace the current system of origin certification by June 30, 2020 at the latest.

In the meantime, Philippine exporters under the EU GSP Scheme can pre-register with BOC using either the pre-application form at https://customs.ec.europa.eu/rex-pa-ui/#/create-preapplication/, or the paper form. Philippine exporters are advised to contact the Export Division or Export Coordination Division of BOC for updates and additional information regarding the application.

DTI said any Philippine exporter, manufacturer, or trader of originating goods, established in the Philippines, is entitled to apply with BOC to become a registered exporter, provided that he holds, at any time, appropriate evidence of the origin of the products he intends to export to the EU, for checks to be carried out by customs authorities.

Philippine exporters can apply to become registered exporters by filling out an application form and returning it to BOC. In turn, BOC, as the country’s competent authority for the registration of exporters and administrative cooperation, will submit the complete and correct application forms in the REX system.

Registered exporters will receive from BOC their registration number (REX number), consisting of a string of 35 alphanumerical characters, including a reference to the country of issue.

However, unregistered exporters are allowed to make out statements on origin for consignments of originating goods having a value below EUR6,000.

Since August last year, the Philippine Exporters Confederation, Inc. has been pushing BOC to take the necessary actions to ensure that Filipino exporters can comply with the REX system, saying it is crucial in allowing Philippine exporters to continue to enjoy the benefits under the EU’s GSP program.

The Philippines was granted beneficiary-country status under the EU GSP+ in December 2014. Under this, the Philippines may export 6,274 eligible products duty-free to the EU market. Prior to December 2014, the Philippines was covered by the regular EU GSP which provided zero duty to only 2,442 products and reduced tariffs to 3,767 products.

According to the EU Trade Preferences Monitoring Report released on January 19, 2018, the robust trade relations between the Philippines and EU were highlighted with EUR2 billion worth of Philippine exports in 2017 benefitting from the GSP+ compared to EUR1.66 billion in 2016.

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