The Chamber of Customs Brokers, Inc. (CCBI) and Aduana Business Club, Inc. (ABCI) are urging the Bureau of Customs (BOC) to temporarily suspend imposition of the P5,000 fine on clerical errors, describing the penalty as “arbitrary, capricious and whimsical”.
The associations said they have received reports of importers and customs brokers being fined on every “perceived violation in alleged failure or incorrect filling up of Box 41 of the IEIRD [Import Entry and Internal Revenue Declaration].”
The imposition of penalties also borders on “grave abuse, and worse, graft and corruption on the part of concerned customs examiners, appraises, and assessment personnel.”
In a joint letter to Customs commissioner Rey Leonardo Guerrero dated July 1 and received July 10, the associations also asked BOC to immediately conduct a public hearing or consultation with stakeholders “to come up with a just, equitable and judicious implementation” of Customs Administrative Order (CAO) 01-2020 in relation to Customs Memorandum Order (CMO) 49-2019.
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CAO 01-2020, issued last March, contains new BOC fines and surcharges for clerical errors, misdeclaration, misclassification, and undervaluation, while CMO 49-2019 issued last year orders the mandatory filling in of Box No. 41 (Supplemental Units) in the lodgment of goods declaration in BOC’s Electronic-to-Mobile System.
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Under CAO 01-2020, errors may be clerical when they are inadvertent, which may include misspelling and/or incorrect input of data while drafting, copying or transposing a document such as consignee(s)’ name, importing vessel or aircraft, port of departure, port of destination and date of arrival, the number and/or marks of packages, the quantity, the nature and correct commodity description of the goods, its value set forth in a proper invoice, packing list and such other information as may be required by rules and regulations, provided that it is not attendant with fraud and not due to gross negligence.
BOC assistant commissioner and spokesperson Atty. Vincent Philip Maronilla, in a text message to PortCalls, said “we will take the letters of CCBI and ABCI under advisement and discuss them thoroughly if the issues raised merit a change in our policy.”
BOC will conduct an online discussion about CAO 01-2020 on its Facebook page on July 15.
CCBI and ABCI said they are receiving countless complaints from importers and customs brokers who claim they are being slapped with the P5,000 fine “even if goods covered by their import entries do not bear the tariff headings listed in Annex A of CMO 49-2019.”
The associations said it is “very clear” under CMO 49-2019 that the requirement for filling out Box 41 in the import entry only applies to goods with tariff headings specified in Annex A of the said order. CMO 49-2019 covers all lodgment of goods declaration under the consumption entry (formal and informal) for HS codes (Harmonized Commodity Description and Coding System) listed in Annex A of the order.
They added that under the CMO, in case of discrepancy/ies in the number of packages or units declared in Box 41 vis-a-vis that stated in the bill of lading (B/L) or packing list, the concerned customs examiner should update the goods declaration accordingly to reflect the number of units stated in the B/L or packing list.
“Interestingly, CMO 49-2019 did not provide for penalties in case of discrepancy in the number of units declared in Box 41,” the groups said.
Under CAO 01-2020, however, an importer, customs brokers, or any port stakeholder will be penalized with a P5,000 fine per clerical error committed in the goods declaration.
CCBI and ABCI noted they are “not questioning whatever noble motive/s that may lie behind the imposition of the fine”, and declared they are “dependable allies of the Bureau of Customs in fostering a corrupt free Aduana” and are in the agency’s promotion of trade facilitation.
The groups, however, said the imposition of penalties on every perceived violation and even on goods not covered by the order “amounts to an arbitrary, capricious and whimsical application of CMO 49-2019 and CAO 1-2020…upon hapless stakeholders.”
“These acts border on the thin line of grave abuse, and worse, graft and corruption on the part of concerned customs examiners, appraises, and assessment personnel/s,” they added.
CCBI and ABCI said there should also be a discussion on the propriety of the P5,000 fine per clerical error.
Under Section 108 of the Customs Modernization and Tariff Act, they noted BOC should not impose substantial penalties for errors when such errors are inadvertent and there was no fraudulent intent or gross negligence in their commission, but to discourage repetition of such errors, “a penalty may be imposed but shall not be excessive.”
The groups pointed out that “so long as those perceived ‘inadvertent’ clerical errors do not in any way affect the amount of duties and taxes to be paid, that P5,000 is so excessive and (a) substantial fine.” – Roumina Pablo
