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GENERAL IMPORT CLEARANCE INFORMATION
Clearance Process
There are approximately 14 approved ports of entry throughout the Philippines:
| Principal Ports of Entry |
Jurisdiction |
|
|
| Port of Manila |
Customs District II-A |
| Manila International Container Port |
Customs District II-B |
| Port of Subic |
Customs District XIII |
| Port of Batangas |
Customs District IV |
| Port of Davao |
Customs District XII |
| Port of Iloilo |
Customs District VI |
| Port of Cagayan de Oro |
Customs District X |
| Port of Legaaspi |
Customs District V |
| Port of San Fernando |
Customs District I |
| Port of Tacloban |
Customs District VIII |
| Port of Surigao |
Customs District IX |
| Port of Zamboanga |
Customs District XI |
Document Requirements
All imports must be covered by the following basic documentations:
- International air waybill (for airfreight) or Bill of Lading (for sea freight)
Bill of lading or Airway bill must be presented with the shipment denoting the shipper, point of origin and means of transportation utilized to move the goods to the Philippines. The bill of lading should provide a brief description of goods consigned under the bill of lading and the description of the articles imported must match as much as possible the description on the Commercial or Pro-forma Invoice.
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Commercial Invoice or Pro-Forma Invoice
A Commercial Invoice must be provided for all goods presented for import into the territory of the Republic of the Philippines. The invoice must contain, among others, a description of all articles and commodities being imported. Each article/commodity must be described in sufficient detail to accurately identify it for tariff classification and statistical purposes and where applicable model, serial and or related markings, country of origin, number and value of goods (as well as cost of insurance and transportation), should be provided. The shipper's intent must be clearly stated on the invoice and the air waybill or bill of lading to avoid improper classification and the kind of entry to be used, especially where duties and taxes are payable. Invoices prepared for the importation of samples, articles for repair, processing, or reconditioning, the return of goods previously exported, goods temporarily imported on consignment and other similar cases must contain sufficient description to allow Customs processing. The Importers TIN or Taxpayer Identification Number should be provided on the documents tendered for export to avoid delays in processing. Incomplete or deficient invoices will not be acceptable for customs processing and will cause delays in customs clearance.
A Pro Forma Invoice will not be accepted by Customs where there is a buyer-seller transaction. Such an invoice may be used for importation of samples, articles for repair, processing or reconditioning, returned articles previously exported, articles sent on consignment and other similar cases.
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Packing List
Although not mandatory, Customs normally require a Packing List to expedite Customs clearance process especially in the case of shipments containing several commodities and multiple package shipments. It is also useful when making insurance claims for missing, lost or damaged articles or when a discrepancy is found upon customs inspection.
Supporting Documentation Requirements
In addition to the basic documentation mentioned above, import clearance/permit must be obtained from the concerned governmental agency in the Philippines or from a recognized non-governmental organization from the country of export for regulated commodities. This document is required for reasons of public health and safety, national security or to satisfy international commitments for the protection or development of the local industry, and must be submitted to customs upon filing of the import entry or prior to release of the regulated commodity or article from customs custody.
Supporting Documentation required for Imports of the following commodities:
Fertilizers
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Permit for Imported Fertilizer Product Registration
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Permit for Experimental Use Permit for Fertilizer Efficacy Trial
Animal Products
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Veterinary Certificates (clean report of findings)
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CITES Import Permit (Export Permit from shipper) for endangered species
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Certificate of Product Registration
Motor Vehicles
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Permit to No-Dollar Importation of Used Motor Vehicle and Affidavit of Undertaking
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Authority to Import Under EO 782 As Amended By EOs 354 and 361 (Used Trucks, Engines, special Purpose Vehicles) and Joint Affidavit of Undertaking
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Permit for Spare Parts Importation (for Motorcycles and Motor Vehicles) and Affidavit
Movie and TV Products
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Import Permit (for Movie and TV Products)
Pesticides
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Registration of a Pesticide Active Ingredient
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Registration of a Pesticide Product
Plants and Plant Products
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Permit to Import Plants and Plant Products
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Plants and Plant Products derived from or that include GMO Genetically Modified materials are subject to permit control per AO2002.
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Phytosanitary Certification
Radio Transmitter(s), Transceiver(s)
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Permit to Purchase/Possess Radio Transmitter(s), Transceiver(s)
Videograms (DVDs, Video-CDs, VHS Tapes)
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Permit for Videogram Import Clearance
General Customs Practices As the primary agency in charge of import control, Bureau of Customs (BOC) verifies that all applicable permits and or approvals necessary for import as deemed by law are obtained and are in proper order.
BOC also verifies that proper agency approvals per commodity are provided or identified where they may be required in situations outside the norm (restricted importations).
BOC administers the collection of duties and taxes and assures that they take place at the time of entry.
Customs Valuation
The primary basis for determining customs value in the Philippines is "Transaction value." The transaction value is the price actually paid or payable for the goods when sold for export to a country. The price actually paid or payable is the total payment made or to be made by the buyer to or for the benefit of the seller for the imported goods. The payment may take the form of a transfer of money or can be made by way of letters of credit or negotiable instruments. Payment may be made directly or indirectly. Certain costs must be added to that price (e.g. commissions and brokerage) and certain other costs must not be included in the customs value (e.g. the cost of transport after importation). The Transaction value shall be adjusted by allowing the 'adjustments' as referred by the World Trade Organization (WTO) valuation code.
Other Methods of Valuation
Whenever the value of the goods is in doubt, Customs may apply the following methods at its discretion to determine the value of the goods and allow for proper assessment of duty as defined by the WTO Valuation Code.
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Transaction value of identical goods
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Transaction value of similar goods
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Deductive value
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Computed value
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Fallback value
Accuracy of the Declared Value
The Customs Law stresses the proper use of the valuation methods and the need for accuracy of the declared value. Direct enforcement includes the seizure of the imported goods when the declared value is disproportionate vis-a-vis the transaction value of identical or similar goods. Other rules emphasize the truthful declaration of traceable components of the international transaction, such as the importer's and the exporter's names and addresses.
Import Duties
Imported articles are subject to the rate or rates of duty in force at the time of entry when entered as a consumption entry or at the time of withdrawal (for consumption) from the warehouse for articles covered by a warehousing entry. Articles are considered 'entered' or 'withdrawn' when the following conditions are met:
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The specified entry form, with related required documents, have been filed and accepted;
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The duties, taxes and/or other charges have been paid or secured (i.e. by deposits).
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The article has arrived at the port/airport of entry.
Liability for Duties and Taxes
Unless relieved by laws or regulations, the liability for duties, taxes, fees and other charges attaching on importation constitutes a personal debt due from the consignee/importer to the government. This debt can only be terminated by payment in full of all duties, taxes and other charges accrued from the time that the article has entered Customs. Any such debt is considered a lien upon the article.
Value-Added Tax (VAT)
Vat is levied and collected on every importation of goods equivalent to 12% based on the total value used by customs in determining tariff and customs duties, plus customs duties, excise tax (if any) and other charges. Where customs duties are determined on the basis of quantity or volume of the goods, the Vat shall be based on the landed cost plus excise taxes, if any.
Classification of Imports
As a general rule, all kinds of imported merchandise are allowed in the Philippines. However, for reasons of public health and safety, national security, international commitments, and development/rationalization of local industry, the importation of certain commodities are regulated or prohibited. In the Philippines, imports are classified as follows:
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Freely Importable Commodities -Commodities the importation of which is neither regulated nor prohibited and may be imported without prior approval or clearance from any government agency.
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Regulated Commodities -- Commodities the importation of which requires import clearances/permits from appropriate government agencies including the Bangko Sentral ng Pilipinas or recognized non-governmental organization (NGO).
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Prohibited Commodities -- Commodities the importation of which is not allowed under existing laws or rules and regulations.
Registration Requirements
A company seeking to import goods into the Philippines must have a tax identification number and be registered as a regular importer with the Customs Intelligence and Investigation Service (CIIS). The registration procedure is relatively simple but may take some weeks. The application for CIIS Registration and the Request to update a Taxpayers Identification Number (TIN) are available in our Forms Library, where you may print copies of each.
Import Entry
As a general rule, all articles imported into the Philippines shall be entered through a customhouse at a port of entry, whether subject to duty/tax or not, where customs inspection, tariff classification and appraisement will be done and where duties, taxes and other charges due on importation shall be paid or secured to be paid prior to release from customs custody.
Importations are entered under Informal Entry or Formal Entry using an official form prescribed therefore.
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INFORMAL ENTRY- An Informal Entry is allowed for the following Imports:
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Articles of a commercial nature intended for sale, barter or hire; the dutiable value of which is PHP 2,000 or less; and
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Personal and household effects or articles imported in passenger's baggage, mail or otherwise which are for personal use and not in commercial quantity.
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FORMAL ENTRY - A formal Entry is required for imports not allowed to be processed and cleared under Informal Entry and a Letter of Credit (L/C) or any other verifiable document evidencing payment shall cover such importations. There are two (2) types of formal entries, as follows:
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Consumption Entry - Generally, a consumption entry is used for articles/commodities imported for consumption or immediate use; specifically for articles/commodities that are commercial in nature intended for sale, barter or hire whose dutiable (CIF) value is more than PHP2, 000.00, as well as for personal and household effects or articles for personal use but are in commercial quantity regardless of its total value.
If the importation is financed through a letter of credit, an importer must first file an Import Entry Declaration (IED) with an authorized agent bank prior to importation and pay the estimated duties at same bank except when the consignee/importer is entitled to duty exemption pursuant to law.
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Warehousing Entry - Generally, a warehousing entry is used for imported articles to be brought after customs clearance to a customs bonded manufacturing warehouse for processing or manufacture into semi-finished or finished products for export or sale in the domestic market. The same entry type is likewise used for imported articles which will be brought to a public or private customs bonded warehouse for temporary storage to be withdrawn at any time for consumption, for transportation to another port in the Philippines, for exportation, or for delivery on board a vessel or aircraft engaged in foreign trade for use on board as sea stores or aircraft stores.
In all cases, an irrevocable domestic letter of credit, bank guarantee or warehousing bond is required to be posted upon filing of a warehousing entry in an amount equivalent to the duties, taxes and other charges determined upon customs inspection conditioned upon the withdrawal of the warehoused articles within the period prescribed by law or payment of duties, taxes and other charges due and upon compliance with all legal requirements regarding their importation.
Modes of Payment for Imports
All contracts (import and export) are subject to control and oversight by the Bangko Sentral ng Pilipinas (Central Bank of the Philippines). Importers and exporters alike should make the necessary arrangement with the International Trade Department of the Bangko Sentral ng Pilipinas, http://www.bsp.gov.ph
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Through the Philippine banking system:
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Letter of Credit (L/C)
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Documents Against Acceptance (D/A)
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Documents Against Payment (D/P)
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Open Account Arrangements (O/A); and
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Direct Remittance
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Outside the banking system:
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Self-Funded/No-Dollar Imports
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Importations on Consignment Basis
Antidumping
Dumping occurs when foreign producers sell their products to an importer in the domestic market at prices lower than their own national markets or at prices below cost of production, the sale or importation of which injures or threatens to injure a domestic industry producing like or comparable products or retards the establishment of a potential domestic industry. It is a form of price discrimination between two national markets, hence subject to anti-dumping duty in the Philippines pursuant to law. This duty shall be equal to the margin of value between the imported price and the ordinary market price of the product, commodity or article. However, the anti-dumping duty may be less than the margin of value between the imported price and the ordinary market price of the product if such lesser duty will be adequate to remove the injury to the domestic industry. Articles found to be 'dumped' can have anti-dumping duties that are in effect for a short period (to be determined by the DTI) or up to a period of 5 years unless terminated by an act of law.
In such cases where products are not shipped directly from the country of origin but are transported to the Philippines through an intermediate country the price at which the product is sold in the Philippines shall be compared with the normal price of the commodity in the country of export. However, the price may also be compared with the price in the country of origin if the commodity was merely transshipped through the intermediate country.
An anti-dumping protest may cover any specific kind or class of a foreign product which is being imported, sold or is likely to be sold into the Philippines at a price less than its normal value, the importation of which might injure, or retard the establishment of, or is likely to injure and industry producing like products in the Philippines.
Any person representing a domestic industry may initiate an anti-dumping investigation with a written application. Such application must include evidence of the dumping, the injury, and the causal link between the dumped imports and the alleged injury along with information about the applicant, the shipper, and the country of origin of the goods. A complete description of the dumped goods including the quantity and how these goods will injure the domestic industry must also be included. If claims are substantiated by the investigation by the Department of Trade and Industry (DTI) additional duties may be enacted on these goods based on the country of origin and or specific manufacturers in one or more countries as deemed necessary to protect the domestic market.
Excise Duties
Excise Taxes
Excise taxes are assessed against certain commodities normally associated with luxury goods, such as spirits, wine, beer, tobacco products, jewelry, perfumes, yachts and some petroleum products. Excise is assessed at a specific percentage of the quantity or number of units (per liter of alcohol) of the goods being imported
Additional Duties
Countervailing Duty
A "countervailing duty" is a special duty levied, in addition to the regular duty and other charges, by an importing country (Philippines) on its imports which have been found to be subsidized in the country of origin or exportation. It is equal to the ascertained amount of subsidy, calculated in terms of subsidy per unit of the subsidized exported product and is imposed following an affirmative final determination.
A countervailing protest may cover any product which is granted, directly or indirectly, by the government in the country of export or origin, any kind or form of specific subsidy upon the exportation or manufacture of such product and the importation of such subsidized product is causing or threatening to cause material injury to a domestic industry, or materially retarding the growth, or preventing the establishment of a domestic industry.
Warehouse Storage Fees
Warehouse storage fees may be applied to goods that are not expeditiously cleared and removed from the bonded Customs warehouse. Normal storage is assessed for goods that are processed and released same day.
Import Taxes
Import duties are assessed based on the CIF value of the goods. Depending on the country of origin and any trade preferences being extended to a specific country the normal duty ranges currently between 3-15% with some commodities having as much as 60% duty associated with them.
Presently there are no duties imposed for exports.
Customs Fees
Customs and Agency Fees
The Philippines has a variety of import processing fees that are normally assessed against items that require review or examination, certifications, quarantine or similar services that are required upon import. The fees are payable at time of service to the agency or agencies responsible for the control of the goods being inspected.
In most cases the fees are nominal, intended only to cover the cost of processing the applications and permit issuance. Some fees can be higher as the agency may require reimbursement for costs incurred in performance of the services based on the size of the shipment or commodity involved. Each agency has specific fees and charges, which can be determined by contacting the agency directly. In many cases the fees are listed on the applications that the importer completes.
The Philippines also has some import and export processing fees such as for items that must be examined or require certifications and quarantines that are required upon import or export. In most cases the fees are nominal intended only to cover the cost of processing the applications and permit issuance. Each agency has specific fees and charges that are levied based on the services required of the agency.
Exchange Controls
Generally; there is no foreign exchange control in the Philippines, which have adopted the floating exchange rates in currency trading. However, no person may import or export nor bring with him into or out of the Philippines, or electronically transfer legal tender Philippine Notes and coins, checks, money order and other bills of exchange drawn in pesos against banks operating in the Philippines in an amount exceeding PHP 10,000.00 without authorization by the Bangko Sentral ng Pilipinas. (Central Bank of the Philippines) (Sec. 4,CB Circular 1389)
Furthermore, any person who brings into or out of the Philippines foreign currency in excess of USD 10,000.00 or its equivalent in foreign currency is required to declare the same in writing and furnish information on the source and purpose for bringing such amount of currency. (CB Circular 308)
Technical Barriers to Trade (TBT's)
Technical barriers to trade are normally intended to protect human, animal or plant life or health, the environment or consumers. They include testing requirements, packaging requirements, marketing standards, certification requirements, origin marking requirements, health and safety regulations, and sanitary and phytosanitary regulations. Labeling requirements are a species of technical barriers to trade.
Consular Fees
No consular fees are charged for imports and exports.
Import Clearance Process
Working with Customs officials throughout the world, FedEx has developed innovative technology to eliminate many paperwork-handling steps and expedite the movement of international shipments. This is the FedEx Express Clear Electronic Customs Clearance System. Starting at the origin, state-of-the-art technology allows the processing of shipment paperwork and electronic transmission of documents to the designated FedEx Hub and destination clearance location. The Express Clear system also keeps a database of regulatory information, which includes importers registration numbers, broker designation, corporate contact names and telephone numbers. At a FedEx hub, international shipments are sorted, scanned and loaded on to an international flight. Vital shipment information is keyed into a worldwide manifest database, which is linked to computer systems operated by brokers and Customs officials in many countries. Even before the plane takes off, or while it is in the air, Customs agents and brokers at the destination airport of entry can begin examining shipping manifests, querying air waybill data if they need more details, assessing duties and taxes and selecting which shipments they wish to examine. International shipments are scanned at all key points throughout the process and allows for up-to-date status reports including when Customs clearance is obtained.
When your shipment arrives in the Philippines, FedEx (Licensee Airfreight 2100, Inc.) completes and obtains all required documents such as the Import Entry and Internal Revenue Declaration, the Supplemental Declaration on Valuation (SDV) and other regulatory permits on behalf of the importer. AF2100 then lodges and processes these documents at the Bureau of Customs. . The duties and taxes are computed, and if selected by Customs, the shipment is examined. AF2100 notifies the consignee of the final results and stated amounts of duties and taxes assessed the shipment Once the importer approves the duties and taxes and payment is completed, the shipment is released from the Customs warehouse.
Inspection of Imported Articles - For the protection of government revenue and public interest and to prevent the entry into the country of smuggled or contraband goods, the Commissioner of Customs shall promulgate the rules and regulations that shall prescribe the procedure in accordance with which the examination of goods shall be undertaken on the importation and the required quantity or percentage thereof: provided that the imported articles shall in any case be subject to the regular examination when:
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The government seal on the container is tampered;
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The container is leaking;
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The shipments details in the shipping documents differ from that in the manifest;
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The shipment has alert or hold order
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If airfreight, where the Commissioner or Collector has knowledge that there is a variance between the declared and true quantity, measurement, weight and tariff classification.
Introduction
In the Philippines the Bureau of Customs (Customs, for brevity) is the governmental agency charged with the enforcement of the tariff and Customs laws and regulations and all other laws or regulations which are subject to enforcement by the Customs or otherwise within its jurisdiction.
Importation of goods into the Philippines is governed by a myriad of import regulations, which, basically, are not much different from those prescribed in other countries. These laws, regulations and document requirements have to be observed and complied with either by the consignee/importer or shipper/exporter as well as air carriers concerned to expedite and facilitate the Customs clearance of imported goods.
Importations in General
In general, unless exempted by law, all articles imported into the Philippines, are subject to Customs duty and internal revenue taxes and whether subject to duty or not, shall be entered through a customhouse at a port of entry, where Customs examination, tariff classification and appraisal are made. Taxes and other charges due shall be paid (or secured to be paid) prior to release from Customs custody even though the goods may have been previously exported from the Philippines. Duty and taxes accrue upon arrival of a shipment into the customs territory of the Republic of the Philippines, unless the goods are exempted from such duties and taxes by process of law.
Owner of Imported Articles
By law, all such articles imported shall be held to be the property of the consignee shown on the air waybill (AWB) or Bill of Lading (B/L) and deemed the owner thereof.
All importations are entered under Informal Entry (goods normally not regulated or controlled by an agency) or Formal Entry (goods that are regulated or controlled by an agency and usually high in value) except the following, which may be entered duty- and tax-free:
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Importations for the official use of foreign embassies, legations, and other agencies of foreign governments, and
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Importations for the personal and family use of the members and attaches of foreign embassies, legations, and other agencies of foreign governments
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Miscellaneous articles that are exempt by law or process.
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