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WEDNESDAY July 12, 2017 SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017 PortCalls S1

S2 PortCalls SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017WEDNESDAY July 12, 2017
WEDNESDAY July 12, 2017 SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017PortCalls S3

BOCs tight balancing act: Trade facilitation and revenue generation

Much has transpired a year since under pressure to shore up collec- billion target for the period. 2016 to P49.9 in 2017, resulting
Customs Commissioner Nicanor tion to help finance the govern- For May alone, BOC collected in higher revenue yields.
Faeldon assumed the leadership ments ambitious Build, Build, P39.6 billion, exceeding the target A particularly weak peso augurs
of the Bureau of Customs (BOC) Build infrastructure program. The of P38.28 billion by 3.4%. The May well for BOC collection, bolster-
in July 2016. P8-trillion program will mostly be collection was also 23.5% higher ing Faeldons assertion that 2017
He came into office after the funded by the national budget. than the P32.07-billion revenue targets will likely be met. Budget
Customs Modernization and Tar- For 2017, the Development posted in the same month last Secretary Benjamin Diokno has
iff Act (CMTA)--the law that Budget Coordinating Committee year, data from the BOC Financial said earlier that a one-peso depre-
overhauls the Philippine customs has assigned BOC a collection tar- Service showed. ciation would yield a net gain of
and tariff system and which aligns get of P468 billion, which Faeldon The customs bureau said the P7.2 billion for the government
Philippine customs practices says is achievable. improved collection performance coffers as revenues will increase by
with international regulations- Already, revenue collection for was largely due to higher oil prices P9.2 billion as a result of higher
-was signed, squarely placing the first five months of the year has in 2017, and the increase in volume collections by the BOC while
on him and his team the task increased 13.6% to P176 billion and value of imports by 19.7% and the foreign debt service will only
of operationalizing the historic from P155.26 billion earned in 28.3%, respectively. have a corresponding increase of
legislation. the same period last year, although The foreign exchange rate P2 billion. (On July 10, 2017, the
Faeldons administration is also 1.5% lower than the P179.08- likewise increased from P47.05 in Turn to next page
S4 PortCalls SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017WEDNESDAY July 12, 2017

BOCs tight balancing act: Trade facilitation...

Continued from previous page origin concerning import and over P5 million, 5%. The law declares large-scale
and export merchandise in CAO 05-2016 allowed tax agricultural smuggling as an
peso was trading at P50.695 to a the Philippines. The order and duty-free shipment of act of economic sabotage
US$1, the lowest since Septem- makes advance rulingan balikbayan boxes (personal and levies heftier penalties
ber 1, 2006, when it was 50.700 official written and binding effects and household goods on violators. CAO No. 02-
against $1.) ruling issued by BOC upon of overseas Filipino work- 2017 covers all importations
the request of an importer, ers). The order covers the of sugar, corn, pork, poultry,
Trade facilitation foreign exporter, or their sending of balikbayan boxes garlic, onion, carrot, fish,
In tandem with the need to authorized agentnow by Qualified Filipinos While and cruciferous vegetables
generate revenues is the push for part of Philippine law. The Abroad to their families and that have a fair market value
trade facilitation, which is now the ruling gives an assessment relatives exempt from the of P1 million, and all im-
focus of many customs administra- of origin or treatment to payment of duties and taxes, portations of rice with a fair
tions. In this area, Faeldons team be applied on a certain ele- up to three times and shall market value of P10 million.
has rolled out a number of orders ment of customs value, or on not exceed P150,000.00 in Covered are importations
pursuant to the CMTA, including: other matters related to the a calendar year. of these products whether
Customs Administrative importation or exportation CAO 01-2017 covers rules in their raw state or after
Order (CAO) 02-2016, of goods under customs ju- for clearance procedures having undergone simple
which raised by a whopping risdiction, prior to an import involving air and sea travel- preparation or preserva-
99,900% the de minimis or export transaction for a ers and crew, as well as their tion for the market. Under
threshold to P10,000 from specified period. baggage, at all Philippine CAO 02-2017, large-scale
P10. The order aims to mini- CAO 04-2016 amended the ports of entry and exit. It agricultural smuggling is
mize import costs and cus- rates of auction bonds for prescribes the procedure committed when such pro-
toms administration costs of public bidding. Under the for clearing air and sea duce is imported or brought
clearing importations with amendment, the posting travelers, crew of air and sea into the Philippines without
de minimis value, without of a duly receipted bond vessels, and their baggage, the required import permit
compromising customs bor- in cash or managers check whether accompanied or from regulatory agencies, or
der enforcement patrol; and should follow the new unaccompanied. It also cov- when the import permits of
seeks to adapt to the growing schedule: a floor price of not ers the process for clearing persons, whether natural or
trend toward trade liberali- over P10,000 will have no baggage deposited in the juridical, other than those
zation and facilitation and bond; floor price exceeding Interline Baggage Room specifically named in the
harmonize the countrys P10,000 but not over P1 mil- and the Customs In-bond permit, are used.
customs laws with different lion will a bond equivalent Baggage Room. CAO 03-2017 covers clear-
applicable international to 20% of the floor price; CAO 02-2017 implements ance procedures for postal
trade agreements. exceeding P1 million but Republic Act 10845 or the items or mail, whether or
CAO 03-2016 established not over P2.5 million, 15%; Anti-Agricultural Smug- not subject to duties, taxes,
an advance ruling system exceeding P2.5 million but gling Act of 2016, which and other charges. CAO 03-
for valuation and rules of not over P5 million, 10%; took effect on June 1, 2017. Turn to page S6
WEDNESDAY July 12, 2017 SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017PortCalls S5
S6 PortCalls SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017WEDNESDAY July 12, 2017

BOCs tight balancing act...

Continued from page S4
2017 states that BOC shall major contributor to corruption.
establish a system for sub- In order to address the issue, the
mitting documents and in- agency is pushing for exemption
formation, to be interfaced from the Salary Standardization
with the designated postal Law so that personnels salaries
operator of the Philippines. may be upgraded.
Among these documents Personnel will also undergo
are the advance copy of the proper training with the launch
Postal Customs Declaration of the Philippines very first
Form for postal items from Philippines Customs Academy.
countries where the desig- Anderson said the academy, to
nated postal operator has be operated by the BOC, ensures
a bilateral or multilateral competent people with the proper
agreement, list of unclaimed training and customs education
postal items beyond 30 days, will be hired and retained by the
list of returned-to-sender agency.
postal items, list of postal Meantime, the BOC has tight-
items that were redirected ened rules on nepotism via the
to a third country, and list issuance of CAO 04-2017. There
of damaged postals. have been numerous reports in the
Customs Memorandum past that regular personnel are able
Order (CMO) 23-2016 to successfully recommend their
vests the power to issue alert relatives to take up positions at
orders in the Philippines the BOC. Prohibited underCAO
solely with the Customs 04-2017 are all appointments that
Commissioner. The power favor a relative of the appointing
to issue alert orders previ- or recommending authority, or
ously given to the Deputy the chief of the bureau or office,
Commissioner, Intelligence or persons exercising immediate
Group; Deputy Commis- supervision over applicant.
sioner, Enforcement Group;
Deputy Commissioner, Systems upgrade
Assessment and Opera- Beyond the focus on personnel,
tions Coordinating Group the BOC is looking at acquiring
on issues concerning rules additional equipment to enhance
of origin, valuation and border protection, specifically more
classification of goods; and x-ray machines and water patrol
all district collectors for assets. The bureau is also pushing
shipments arriving within for its institutionalization as a law
their district and sub-ports, enforcement agency, Anderson
underCMO CMO 35-2015, noted.
has been revoked. In addition, the BOC is eyeing
to upgrade its systems. It is now
Right personnel shopping around for a mainte-
None of the BOC policies and nance provider for its electronic-
orders would mean anything if the to-mobile (e2m) system, which
right people arent on the right bus, was introduced in 2004 but has
so to speak. since seen better days. The e2m
BOC spokesperson Atty Mandy is prone to downtime, which not processing of import and export ports and warehouses across the
Anderson told PortCalls BOC only delays clearance processes permits and accreditation of im- country have yielded at least
remains firm in its commitment but also opens up avenues for porters from months to three days, 795 kilos of methamphetamine
to fill the gap in its manpower corruption. or even less. The system was to hydrochloride, locally known
capabilities by ensuring hiring The National Single Window have been pilot-tested in July and asshabu, and worth more than
qualified individuals for available (NSW)--a trade facilitation targeted for rollout by September. P7.6 billion, the agency said in
posts will be accomplished and that measure that aims to connect 40 While equipment acquisition an earlier statement.
the hiring, according to CSC (Civil government agencies and allow and systems upgrades are being The latest anti-illegal drugs ac-
Service Commission) standards, them to transfer electronically worked on, the BOC is in the complishment report released by
will be observed. data and other information rel- meantime clearing its database of the BOC showed that the biggest
As stated in previous pro- evant to import processing--has importers and customs brokers that catch came on May 26, 2017, when
nouncements, the BOC will also moved slowly, if at all, in the last are under investigation, have show 605 kilos of high-gradeshabuwith
ensure that personnel who have year, plagued by interconnection cause orders, or are prohibited from an estimated street value of P6.4
long been with the bureau will get issues among the agencies. The reactivating their accreditation fol-billion were confiscated.
their rightful promotion. Align- NSW will now be subsumed un- lowing seizure of their shipments. The BOCs work is cut out for it
ing the agency according to the der TradeNet, a bigger and more To this end, the Account Manage- as it moves forward. It has to raise
CMTA is also a top priority. This ambitious automation project to ment Office regularly publishes considerable revenue on the one
includes restructuring the agency be handled by the newly formed such a list. hand, and boost trade facilitation
in terms of its territorial jurisdic- Department of Information and measures, on the other, all under
tion, staffing patterns, renaming Communications Technology. Illegal drugs the watchful eyes of a skeptical
the BOC, that is, renaming of TradeNet, a single online platform Hewing to the Duterte admin- public that sees the agency as a
officials to comply with interna- for traders, will connect 66 agen- istrations focus on an anti-drug hotbed for corruption. BOCs tasks
tional practice. cies and 10 economic zones in- war, the BOC has stepped up its can only be seen as a very tall order
The BOC is regarded as one volved in regulating the countrys anti-drugs efforts in the last year. that can only be achieved over time
of the most corrupt agencies in trade; it will also link the NSW Drug seizures made during with a mix of the right policies on
government. The low salary of to the ASEAN Single Window. intelligence operations from people, systems, and process -- and
employees is generally seen as a TradeNet seeks to expedite the July 2016 to May 2017 in several with much political will.
WEDNESDAY July 12, 2017 SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017 PortCalls S7
S8 PortCalls SUPPLEMENT: Bureau of Customs operational highlights, 2016-2017WEDNESDAY July 12, 2017



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