PH, HK ink plan for mutual AEO program recognition

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Philippine Bureau of Customs-Interim AEO Office chief Atty. Clarence Dizon (left) and Hong Kong Customs and Excise Department assistant commissioner Rudy Hui during the signing of the AEO Mutual Recognition Agreement Action Plan. Photo from the Hong Kong Customs and Excise Department.
  • The Philippines and Hong Kong signed a plan for mutual recognition under the Authorized Economic Operator program
  • Hong Kong Customs sees the move as a key step toward a forthcoming mutual recognition agreement between the two customs jurisdictions
  • Both parties are eyeing joint visits to validate the program’s compatibility
  • Bureau of Customs actively engages in developing AEO agreements with ASEAN nations and pursuing negotiations with Japan, Israel, and South Korea

The Philippines and Hong Kong recently signed off on an action plan for the mutual recognition agreement (MRA) for the Authorized Economic Operator (AEO) program.

The Hong Kong Customs and Excise Department, in a statement, described the move as a significant step towards an imminent MRA conclusion between the two countries.

RELATED READ: BOC in talks with HK, Israel for AEO mutual recognition

The AEO MRA action plan, formalized during the AEO Expert Mission and Symposium held on November 29-30 in Manila, sets the stage for joint validation visits by both parties. These visits aim to assess the compatibility of each country’s AEO program, the Bureau of Customs (BOC) said in a separate statement.

An MRA refers to a formal document between two or more customs administrations outlining the circumstances and conditions for recognizing and accepting the AEO programs of the signing parties.

The AEO program is a global initiative by customs administrations to enhance trade security and facilitation. It incentivizes collaboration between traders and customs administrations to bolster supply chain security.

Implementation of the AEO program in the Philippines became possible in 2016 with the passage of Republic Act No. 10863, otherwise known as the Customs Modernization and Tariff Act.

The BOC launched its AEO Program in December 2019, aligning with the World Customs Organization’s SAFE Framework of Standards to Secure and Facilitate Global Trade.

The BOC, having signed an MRA with China on January 3, is also negotiating for MRAs are underway with Japan, Israel, and South Korea. The Philippines, together with the nine other members of the Association of Southeast Asian Nations, last September also signed the MRA of their respective AEO Programs, with a view toward implementing the regional AEO MRA by 2025.

MRAs serve as a platform for AEO programs to provide additional benefits to their members through international recognition with partner countries.

Generally, MRA benefits include a higher level of facilitation during cargo clearance, domestic and overseas; priority treatment if the cargo has been selected for inspection; and expedited customs cargo clearance in the event of trade disruption.

The BOC’s AEO program currently includes importers and exporters. Three companies – Toyota Motors Philippines Corp., Panasonic Manufacturing Philippines Corp., and Coca-Cola Beverages Philippines – are accredited under AEO Level 1. These companies are under evaluation for Level 2 accreditation, as stated in the BOC’s 2023 midyear report.

Other stakeholders will also be eligible to apply for an AEO accreditation, with specific guidelines to be issued separately by the BOC.

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