ORIGIN CUSTOMS.pptx

TARIFF MANAGEMENT
Customs Appraisal and Assessment
Clinton Samson, LCB, MMlscm

Bureau of Customs History: A Walkthrough
II.
SPANISH
REGIME
I. BARTER
SYSTEM
III.
AMERICAN
REGIME
IV. COMMONWEALTH
GOVERNMENT
V. THE REPUBLIC
VI. THE REORGANIZATION
OF THE BUREAU OF CUSTOMS
I. OVERVIEW

I. OVERVIEW
• Exchange of goods were the trading arrangement during the pre-colonial
era
• The barangay “datus” or “rajahs” collected tributes from people before they
were allowed to engage in trade
• Thus, this practice of collecting tributes was considered the customs law
during this time.
• It is quite interesting to note that even during the latest law or the Customs
Modernization and Tariff Act (CMTA), trade arrangements such as barter is
still provided.
I. BARTER SYSTEM

I. OVERVIEW
• Spanish Customs Law, 1582-1828 - concept of ad valorem levied on import
and export.
• Tariff Board drew up a tariff of fixed values for all imported articles on which
ten percent (10%) ad valorem duty was uniformly collected.
• Spanish Tariff Code, 1891 - specific duties on all imports and on certain
exports were imposed and this lasted till the end of the Spanish rule in the
Philippines.
II. SPANISH REGIME

I. OVERVIEW
• Act No. 33, Oct 24, 1900 –abolished and changed the position of Captain of the Port to
Collector of Customs in all ports of entry except the Port of Manila.
• Philippine Customs Administrative Act 355, February 6, 1902 - established the Philippine
Customs Service
• Act No. 625, February 9, 1903 - abolished the Captain of the Port for the Port of Manila and
transferring powers and authority to Insular Collector of Customs
• Philippine Tariff Act of 1909 - The first tariff legislation of the Philippines was passed by the
United States (US) Congress. This law laid the legal foundation for the imposition of tariffs on
goods coming from foreign countries and entering the Philippines.
• Public Act No. 430 - transformed the Philippine Customs Service to a Bureau of Customs
and Immigration under the supervision and control of the Department of Finance and Justice
III. AMERICAN REGIME

I. OVERVIEW
• Commonwealth Act No. 613, “The Philippine Immigration Act of 1940”
August 26, 1940 – forming the Bureau of Immigration as a Separate office
from the Bureau of Customs
IV. COMMONWEALTH GOVERNMENT

I. OVERVIEW
V. THE REPUBLIC
• Republic Act No. 3, “An act to continue in force and effect the act of the Congress of
the United States, Approved On August 5, 1909, Entitled "An Act To Raise Revenue For
The Philippine Islands, and for Other Purposes," Otherwise Known As "The Philippine
Tariff Law Of 1909," as amended”, July 4, 1946 - all importations from the United States
enjoyed full exemptions pursuant to the Tariff Act No. 1902
Bureau of Customs has as its head the Insular Collector of Customs. He was assisted by the
Deputy Insular Collector of Customs. Both officials were concurrently Collector of Customs
and the Deputy Collector of Customs of the Port of Manila
• Executive Order No. 94, July 1, 1947 - the President of the Philippines reorganized the
different departments, bureaus, offices and agencies of the government of the Republic of the
Philippines. Consequently, the Insular Collector of Customs was changed to Collector of
Customs for the Port of Manila.
• Republic Act No. 1937, “Tariff Law of the Republic of the Philippines”, July 1, 1957 - the
first official expression of an autonomous Philippine Tariff Policy.

I. OVERVIEW
VI. THE REORGANIZATION OF THE BUREAU OF CUSTOMS
• Administrative Code No. ______ -
• Customs Administrative Order No. 4, February 4, 1965 - the Bureau of Customs was
reorganized. Offices under the direct supervision and control of the Commissioner were
elevated to Department Level with ranks higher than Division Level. These Departments were
the following: Public Relations, Personnel, Legal, Administrative Service, Budget and Finance,
and the Management Improvement. Likewise, three (3) ranking Customs positions were
created, namely: Assistant Commissioner for Revenue, Assistant Commissioner for Security,
and Director for Operations. Later, it was amended abolishing the position of Assistant
Commissioner for Security and creating the position of Director for Administration.
• Presidential Decree No. 1 , September 24, 1972, - Reorganized the Executive Branch of the
National Government, creating six (6) Customs Services under the Office of the Commissioner
and created jurisdictional limits of twelve (12) collection districts with the Principal Ports and
Sub-ports of entry under the supervision and control of the Collector of the Principal Port of
Entry.

I. OVERVIEW
• Presidential Decree No. 34 , November 26, 1972 - amended the Tariff & Customs Code of
the Philippines.
• Presidential Decree No. 689, “Revising the staffing pattern of the Bureau of Customs
and increasing the salaries of officers and employees”, April 22, 1975 - another
reorganization in the Bureau of Customs was made and mandated the increase in the
salaries of officers and employees.
• Presidential Decree No. 1464, “A Decree to Consolidate and Codify all the Tariff and
Customs Laws of the Philippines”, June 11, 1978 - the Tariff & Customs Code was further
amended, modified and supplemented by new positions.

I. OVERVIEW
• Tariff & Customs Code of 1982, revised by virtue of Executive Order No. 688, “Aligning the Philippine Tariff
Nomenclature and the General Rules of Classification provided for under Sections 104 And 203 of
Presidential Decree No. 1464 in accordance with the Customs Cooperation Council Nomenclature”, May 9,
1981 - with the accession of the Philippines to the Customs Co-Operation Council (CCC), the Tariff & Customs
Code was revised anew in order to align the tariff system with the CCC Nomenclature.
It also assimilated various amendments to the Customs Code under:
• P.D. 1628, “To amend the Second Paragraph of Section 104 and to Modify the Rates of Duty on Certain
Imported Articles Provided under Presidential Decree No. 1464, otherwise known as The Tariff and
Customs Code of 1978”, 11 July 1979
• P.D. 1980 “Further amending Section Three of Republic Act No. 85, as amended, otherwise known as
the DBP Charter”, 13 July 1985 – wherein the amount of taxes due to the National Government on income
beginning with the calendar year 1978 as well as taxes due on all other transactions of the Bank beginning with
the calendar year 1985 is hereby appropriated under this Decree to be automatically applied to the payment of
the subscribed capital stock of the government in the Bank.
• Executive Order No. 578, series of 1980 - Tariff concessions under the General Agreement on Tariffs and
Trade
• Various Executive Orders from 1978 to 1981 - Tariff concessions granted to ASEAN member countries

I. OVERVIEW
• Executive Order No. 127, “Reorganizing the Ministry of Finance”, 30 January 1987 -
The last major reorganization of the Bureau took place in 1986 after the EDSA Revolution. It
expanded the organization umbrella of the Central Office by providing offices that will monitor
and coordinate assessment and operations of the Bureau and provided for a staff of about
5,500 customs personnel.
• Executive Order No. 463 “Creating the Management Information System and
Technology Group in line with the Computerization Program of the Bureau of
Customs”, 9 January 1998 - The implementation of the computerization program also
necessitated the creation of a new Group to ensure its continuous development and
progress. The creation of the Management Information System and Technology Group
(MISTG) under a new Deputy Commissioner with 92 positions.

I. OVERVIEW
• REPUBLIC ACT NO. 9135, “An Act Amending Certain Provisions of Presidential Decree
No. 1464, otherwise known as The Tariff and Customs Code of the Philippines, as
amended, and for other purposes”, April 27, 2001 – It incorporated the Rules on Customs
Valuation (Transaction Value) implementing the WTO Agreement on Implementation of
Article VII of the GATT 1994 following conclusion of the Uruguay Round.
• Executive Order No. 160 s 2003, January 6, 2003, “Creating the Post Entry Audit Group
in the Bureau of Customs.

• Signed into law on May 30, 2016
• Took effect on June 16, 2016
• CMTA provisions were basically restatements of some of the
provisions of the TCCP
• The introduction of new provisions are taken from the provisions
of the Revised Kyoto Convention to which the Philippines is a
signatory, institutionalized policies established by the BOC
through time and other subject matters which are deemed by
Congress as essential to modernize customs procedures and
processes.
14
Republic Act No. 10863 otherwise known as “Customs Modernization and
Tariff Act” repealed Book II of the Tariff and Customs Code of the Philippines
(TCCP)

 18 Titles
 43 Chapters
 212 provisions related to the TCCP
 56 provisions related to RKC
 53 new provisions
 Section 101 to Section 1805
15
Contents of the CMTA

1. Customs Administrative Order (CAO) - This contains the rules and regulations which are
promulgated by the Commissioner of Customs and approved by the Secretary of Finance to
implement certain provisions of the CMTA and all instructions for the information and
guidance of all officials and employees including the public in general, in connection with the
proper administration and operation of the bureau.
2. Customs Memorandum Order (CMO) - This contains the directives and/or instructions
affecting the officials and employees of the Bureau involving a more limited scope and
requiring definite compliance. Customs Memorandum Orders are not subject to the approval
of the Secretary or Finance. CMOs also substantiate or flesh out provisions of CAOs which
are general in nature
3. Customs Memorandum Circular (CMC) - This contains dissemination of instructions and
other information for the guidance of all officials and employees and the public in general,
including the circularization of rulings, precedents , laws, or regulations of general interest,
the opinions of the Secretary of Justice, resolutions and decisions of courts and the
Chairman of the Civil Service Commission which affect the functions and duties of the
Bureau's personnel. This also includes such rules and regulations which are issued by the
different agencies of the government and which affect the functions of the Bureau. This
however, does not include matters effecting valuations, appraisal, classification and
liquidation of imported articles which are covered by another series of Customs Circular.
1 2
16
CUSTOMS TERMS YOU MAY WANT TO KNOW

4. Transaction Value - is the price actually paid or payable for goods sold for export.
5. Customs Value/Dutiable Value – is the transaction value of imported goods that is the
price actually paid or payable for the goods when sold for export to the country of importation
adjusted in accordance with the provisions of Article 8 of the Agreement on Implementation of
Article VII of the General Agreement on Tariffs and Trade 1994. (Agreement on Implementation
of Article VII of the General Agreement on Tariffs and Trade 1994, Article 1). The Customs
Value or Dutiable Value shall be the basis for the computing import customs duties.
6. Landed Cost – refers to the total cost of a product delivered at a port of destination,
including the invoice amount, customs duties, freight, insurance and other charges (brokerage
fee, bank charge, processing fee, arrastre charges and wharfage dues, if applicable. The
Landed shall be the basis for the computing import VAT.
1 2
17

7. Storage Fee - is the amount assessed on merchandise for storage in customs premises,
cargo sheds and warehouses of the government. The owner, consignee, or agent of either, of
the merchandise is liable for this charge. (Section 1 (d), REPUBLIC ACT No. 1371, June 18,
1955). This is collected by ICTSI/ATI (but certain charges also goes to PPA)
8. Arrastre Charge – is the amount which the owner, consignee, or agent of either, of
merchandise or baggage has to pay for the handling, receiving and custody of the imported or
exported merchandise or the baggage of the passengers. ((Section 1 (e), REPUBLIC ACT No.
1371, June 18, 1955). This is collected by the terminal operators (ICTSI/ATI)
9. Detention Charge – A charge collected when the importer has picked up the container for
unpacking, but the empty container has not returned to the nominated depot within the agreed
free-time. It is normal for a port to offer 3-5 days of free storage. However, each terminal has
slightly different rules which can change at any time. The charge is collected by the shipping
line.
10. Demurrage - It is a charge raised when the full container is not moved out of the
port/terminal for unpacking within the allowed free days offered by the shipping line. The charge
is levied by the shipping line to the importer.
18

11. Smuggling in general – refers to the fraudulent act of importing any goods into the
Philippines, or the act of assisting in receiving, concealing, buying, selling, disposing or
transporting such goods, with full knowledge that the same has been fraudulently imported, or
the fraudulent exportations of goods. Goods referred to under this definition shall be known as
smuggled goods; (Sec. 102 (nn), CMTA)
12. Technical smuggling - shall refer to the act of importing goods into the country by means
of fraudulent, falsified or erroneous declaration of the goods to its nature, kind, quality, quantity
or weight, for the purpose of reducing or avoiding payment of prescribed taxes, duties and other
charges (Sec. 102 (pp), CMTA).
13. Outright smuggling - shall refer to the act of importing goods into the country without
complete customs prescribed importation documents, or without being cleared by customs or
other regulatory government agencies, for the purpose of evading payment of prescribed taxes,
duties and other government charges (Sec. 102 (ff), CMTA)
19

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