Thursday, October 23, 2008

The Customs and Tariff Modernization Act of 2008

I just read the final draft of The Customs and Tariff Modernization Act of 2008. Some provisions was added and certain provisions were amended so it can be more applicable in current times. As a customs administration student, one of the problems is that the section numbers is changed. Once we graduate and this bill was passed, we would have to start from scratch as in memorizing and studying EVERYTHING!! I like the format and how it is logically arranged and I admit some of the new provisions is already being implemented by CMOs and CAOs but it will be so much pain in the butt for CA students like me. It is as though the past 4 years studying and memorizing the sections of the tariff and customs code has all amounted to nothing. I maybe overreacting but the last couple of years studying was not walk in the park.

There are some provisions that I find to be vague but only one that I find repulsive. Look at subsection 2 (in red font)

"SEC. 113. EXAMINATION OF THE GOODS


(1) TIME REQUIRED FOR EXAMINATION OF GOODS


WHEN THE EXAMINATION OF GOODS IS REQUIRED BY CUSTOMS, SUCH EXAMINATION
SHALL TAKE PLACE AS SOON AS POSSIBLE AFTER THE GOODS DECLARATION HAS BEEN LODGED.
WHEN SCHEDULING EXAMINATIONS, PRIORITY SHALL BE GIVEN TO THE EXAMINATION OF LIVE ANIMALS AND PERISHABLE GOODS AND TO OTHER GOODS WHICH CUSTOMS CONSIDER AS URGENTLY NEEDING EXAMINATION.


CUSTOMS AND OTHER AGENCIES CONCERNED SHALL COME OUT WITH A SYSTEM OF
COORDINATION AND JOINT EXAMINATION OF GOODS WHICH MUST BE INSPECTED BY THE LATTER UNDER EXISTING LEGISLATION.


(2) PRESENCE OF THE DECLARANT AT EXAMINATION OF GOODS


AS A GENERAL RULE, CUSTOMS MAY EXAMINE GOODS WITHOUT THE PRESENCE OF THE DECLARANT OR AN AUTHORIZED REPRESENTATIVE. HOWEVER, IF THE DECLARANT SO REQUESTS, HE OR AN AUTHORIZED REPRESENTATIVE SHALL BE ALLOWED TO BE PRESENT UNLESS SERIOUS, EXCEPTIONAL CIRCUMSTANCES EXIST TO BAR THEIR PRESENCE.


IF CUSTOMS DEEM IT USEFUL, THEY SHALL REQUIRE THE DECLARANT TO BE PRESENT OR TO BE REPRESENTED AT THE EXAMINATION OF THE GOODS TO GIVE THEM ANYASSISTANCE NECESSARY TO FACILITATE THE EXAMINATION.


(3) SAMPLING BY THE CUSTOMS


SAMPLES SHALL BE TAKEN ONLY WHERE DEEMED NECESSARY BY CUSTOMS TO
ESTABLISH THE TARIFF DESCRIPTION AND/OR VALUE OF GOODS DECLARED OR TO
ENSURE COMPLIANCE WITH CUSTOMS AND RELATED LAWS. SAMPLES DRAWN SHALL
BE AS SMALL AS POSSIBLE."


When I read this section I was dumbfounded. In the seaports this may have a little effect because the importer or broker will need to pay for the use of the gantry crane used in moving the container which usually happens during the examination so there is a big chance that the importer or the broker is present during the examination. Still, there is the huge possibility that they can abuse their authority. What about shipments in airports or in the post office? Who the hell in their right mind would allow other people to open their shipment even if he is a competent authority. We are talking about Bureau of Customs here. Halerrrr!!!! Why would I put my trust on the agency that is well-known for its graft and corruption.

Sunday, October 12, 2008

Regulated Importation

Regulated importations are imported goods that requires clearances or permit from corresponding government agencies upon each importation.

Articles that need import permit/clearance and government agencies that issues them:


Live Animals and Meat
Bureau of Animal Industry (BAI)
Fruits and Plants
Bureau of Plant Industry (BPI)
Rice and Corn
National Food Authority
Marine and Aquatic Products
Bureau of Fisheries and Aquatic Resources (BFAR)
Medicines and the like
Bureau of Food and Drugs (BFAD)
Chlorofluorocarbon and other Ozone Depleting Substances
Department of Environment and Natural Resources (DENR)
Endangered Species
Department of Environment and Natural Resources (DENR)
Various Chemicals used for the manufacture of explosives
Philippine National Police - Firearms and Explosives (PNP-FEO)
Firearms, Parts, Ammunitions, etc.
Philippine National Police - Firearms and Explosives (PNP-FEO)
Pesticides including Agricultural Chemicals
Fertilizer and Pesticide Authority
VHS, Tapes, CDs, DVDs, etc.
Optical Media Board (OMB)
TV, Movie, Film Print and Negatives, etc.
Movie and Television Review and Classification Board (MTRCB)
Transceivers, Communication Equipment, etc.
National Telecommunications Commission (NTC)
Refined Petroleum Products
Energy Regulatory Board (ERB)
Coal and Coal derivatives
Energy Regulatory Board (ERB)
Motor vehicles, Parts and Components
Department of Trade Industry (DTI), Board of Investments (BOI), Bureau of Import Services (BIS)
Color Reproduction Machines
NBI and Cash Department – Bangko Sentral ng Pilipinas
Legal tender of Philippine Currency in excess of P10,000
Bangko Sentral ng Pilipinas

Addendum: List of Regulated Import Commodities and its Administering Agencies

Prohibited Importations

Prohibited importations are imported goods that cannot be brought in the country under existing laws and regulations except otherwise permitted under strict conditions and regulations from corresponding government agency.

There are two kinds of prohibited importations:

1. Absolutely prohibited - these are goods the importation of which is not allowed under existing laws.
2. Conditionally prohibited - these are goods that cannot be brought into the country except when authorized by law and permitted by corresponding government agencies under strict guidelines and regulations.

The list of prohibited import articles is written in the Sec. 101 of the Tariff and Customs Code of the Philippines (TCCP), as amended.

Other provisions prohibiting importation of certain goods:
Republic Act No. 4653 - used clothing, rags
Letter of Instructions no. 1264 - toy guns
Republic Act No. 8293 - articles that violates the intellectual property rights (pirated cd, dvd, imitation products)
Endangered species classified under CITES Appendix I

INCOTERMS

Sending goods from one country to another, as part of commercial transaction, can be risky business. If they are lost or damaged, or if delivery does not take place some other reason, the climate of confidence between parties may degenerate to the point where a lawsuit is brought. However, above all, sellers and buyers in international contracts want their deals to successfully complete.

In import and export trade, merchants wishing to have commercial transactions should specify that their contracts are governed by internationally accepted rules pertaining to where the responsibility for the goods is transferred from the seller to the buyer. This gave rise to the development of earlier INCOTERMS.

What are INCOTERMS?

INCOTERMS are rules governing the placing of goods at the disposal of the buyer at the named point of delivery for their loading on the conveyance (vessel, aircraft). The INCOTERMS, likewise establish the relationships of the seller and the buyer insofar as:

1. Duties and responsibility is concerned.
2. Specific charges to be shouldered.
3. All risks of the goods from the date of expiration of the period fixed that should be borne.
4. Assistance required in obtaining documents which are issued in the country of origin.

If, when drawn up their contract. buyer and seller specifically refer to one of the International Chamber of Commerce (ICC) Incoterms, they can be sure of defining their respective responsibilities, simply and safely. In so doing they eliminate any possibility of misunderstanding and subsequent dispute.

Purpose of INCOTERMS:

1. To provide a set of international rules for the interpretation of the most commonly used trade terms in foreign trade. The uncertainties of different interpretation of such terms in different countries can be avoided or at least reduced to a considerable degree.
2. To provide a set of international rules for the interpretation of trade terms.
3. To remedy problems related to misunderstanding, disputes and litigation considering the waste of money that entails.

- From the hand-out given by Mr. Henry R. Austria

For the List of Incoterms click here to download it in a microsoft word document.

Get more information about Incoterms in Wikipedia.