CM106 Module 1 5

Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo
City Tel. No. (047) 224-2089 loc. 314
College of Business and Accountancy

Program: Bachelor of Science in Customs Administration
Course Code: CM106
Course Title: Customs Proceedings
Course Description:
This course will discuss the customs administrative and judicial proceedings under Title XI
of the Customs Modernization and Tariff Act (CMTA), related laws, implementing rules and
regulations (IRRs). This will also discuss the uniform rules and procedures of the Bureau of
Customs (BOC) in exercising its exclusive original jurisdiction (inherent power) over all goods
subject to seizure and forfeiture. This will also discuss advance ruling, protest, dispute
settlement, abandonment, disposition, redemption and other remedies under the scope of
aforementioned act, related laws, and IRRs.
Course Learning Outcomes:
1. To realize the importance and concepts of customs and court proceedings;
2. To deeply understand and familiarize the limitations, conditions and procedures of the
conduct of seizure and forfeiture of goods; and
3. To analyze problems (i.e., case analysis) in relation to customs searches, seizure and
forfeiture of goods while applying the provisions of aforementioned act, related laws and
IRRs
Grading Rubric:
Midterm Grade Final Grade
Major Exam 30% Major Exam 30%
Quizzes 40% Quizzes 40%
Recitation 30% Recitation 30%
Midterm Grade 100%
FINAL GRADE 50% (Midterm Grade)
50% (Tentative Final Grade)
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CUSTOMS PROCEEDINGS | 2nd SEMESTER A.Y. 2023-2024 NOT
FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
Schedule Module Learning Teaching and

Number and Objectives Learning
(Week No. Topics Learning Tasks
Title Material
or Approx. (most essential and Key
Resources
Hours) learning Concepts
competencies)
1st – 2nd MODULE 1:

Week ● Understand and ● Advanc
ADVANCE ● CMTA, ● To read all the
learn the e
RULING related IRRs materials related to
mechanism of Ruling
and rulings this topic and
BOC to issue on
conduct further
advance rulings Tariff
● PC/Internet research (if any); and
on the Classifi
cation, ● To accomplish
classification,
Valuati activities given on
valuation, origin ● Google
on and this module
of goods and Rules
other customs of
issues; Origin References:
of ● TC Order
● To master the goods 2017-01
rules and ● CAO
procedures for 03-2016
advance ruling; ● CMO
30-2016
● To realize the
purpose of
advance ruling
on importation
and exportation
● To determine
which goods can
be covered for
an advance
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ruling
application
3rd to 4th To MODULE 2:
determine
DISPUTE ● ● Dispute ● CMTA, omplish activities given
the
SETTLEMEN Settlem related IRRs module
conditions
T& ent and rulings
that shall be
PROTEST
taken into
● Protest ● PC/Internet
consideratio
n in
applying this
● Google
remedy
References:
To
familiarize
the rules and
procedures ● CAO 2-2020
relating to ● Commission
this topic Order 2018 –
week 01
5th week MODULE 3:

● To be
ALERT Issuance of ● CMTA, and
ORDER knowledgeable
Alert related IRRs
about the Order
issuance of alert ● PC/Internet
order and its - System
effect in the s ● To accomplish
processing/relea implem activities/quiz given
● Google
se of goods ented on this module
for
● To familiarize issuanc
References:
the system e and
lifting ● CAO 7
which handles
of -2019
Alert Order
Alert ● CMO 47 –
Order 2019
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● To know or - Persons ● CMO 41 –

familiarize the authori 2019
Rules for zed to ● CMO 6 –
Electronic/Manu issue/li 2019
al Issuance and ft Alert ● CMO 27 –
Order 2018
Lifting of Alert
● CMO 20 –
Orders at all
2018
Ports of Entry ● CMO 7 –
2018
● To differentiate ● CMO 3 –
Alert & Hold 2018
Orders ● CMO 29 –
2017
● CMO 20 –
2017
● CMO 14 –
2017
● CMO 23 –
2016
● CMO 35 –
2015
● CMO 24 –
2014
● CMO 21 –
2014
● CMO 27 –
2010
6th -8th week MODULE 4:
● To identify
SEIZURE ● Persons ● CMTA, ● To answer
the properties
AND exercisi related laws, questions or
subject to
FORFEITUR ng IRRs and activities given
seizure and
E police customs/cour on end of this
forfeiture
authorit t cases module.
● To understand y
the conditions in ● PC/Internet
effecting seizure
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and forfeiture or ● Propert ● Google

release of seized ies
items subject
to References:
● To familiarize Seizure - CA0 10 –
the uniform and 2020
procedure in Forfeit - CMO 12 –
seizure and ure 2008
forfeiture cases - CMO 10 –
including the ● Conditi 2006
rules on ons for
settlement, forfeitu
redemption, and re
other remedies
● Commi
● To know ssioner
persons having ’s
police authority Power
on searches, to
seizure and Inspect
forfeiture and
Visit
● Issuanc
e&
Service
of
Warran
t and
Seizure
and
Detenti
on
● Forfeit
ure
Procee
dings
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● Other
topics
under
this
scope
9th – 11th MODULE 5:

week ● Pleadin ● CMTA,
APPEAL IN ● To further
gs related laws,
PROTEST understand
Notices IRRs and ● To accomplish
AND provisions on
and customs/cour activities/quiz given
FORFEITUR appeal in protest
Appear t cases on this topic
E CASES and forfeiture
ances
cases ● PC/Internet
● Manual
● To differentiate
of ● Google
and familiarize
Proced
the protest and
ure for
forfeiture References:
Forfeit
procedures
ure ● CAO
Cases 10-2020
● CMO
4A-2018
● CMO 4-2018
● CMO 8-2007
● CMO 28-90
12th week MODULE 6: ● CMTA,

related laws,
ABANDONM ● To understand ● Aband ● To answer
IRRs and
ENT and familiarize onment questions or
customs/cour
kinds and effect , kinds activities given
t cases
of Abandonment and every end of the
effects ● PC/Internet module.
● To familiarize of
how
● Google
Recall/Lifting/R
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City Tel. No. (047) 224-2089 loc. 314
econsideration/S ● Guideli
etting Aside of nes on
Order/Decree/D References:
the
ecision of Recall/ - CMO 17-2019
Abandonment Lifting/
applied - CMO 16-2019
Recons
ideratio - CMO 18-2004
n/Settin
- CMO 36-2011
g Aside
of Any
Order/
Decree/
Decisio
n of
Aband
onment
13th – 14th MODULE 7: ● To know ● Compr ● To answer
week authority of omise ● CMTA, questions or
OTHER
Commissioner settlem related laws, activities given
ADMINISTR
to compromise ent and IRRs every end of the
ATIVE
any ● Powers module.
PROCEEDIN
of ● PC/Internet
GS AND administrative
BOC to
CIVIL case
fully ● Google
REMEDIES
implem
FOR THE ● To identify ent/exe
COLLECTIO which rcise its
N OF DUTIES administrative audit
AND TAXES
case shall be powers
subject to
compromise ● Custom
settlement of s
Commissioner Remedi
es to
● To familiarize exercis
the procedure of e
summa
ry
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City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
compromise remedi
settlement es to
implem
● To know the ent
civil remedies BOC
audit
and its
finding
procedure for
the collection of
duties, taxes,
fees, or charges
15th week MODULE 8: ● To understand ● Civil ● CMTA, ● To answer
JUDICIAL Doctrine of and related laws, questions or
PROCEEDIN Primary crimina and IRRs activities given
GS Jurisdiction and l every end of the
Doctrine of actions ● PC/Internet module.
and
Exhaustion of
procee ● Google
Administrative
dings
Remedy ● Rules
● To know the References:
of
process of court ● CAO
prosecution and on 10-2020
handling of custom
criminal cases cases
● To understand under
the procedures appeal
● Exclusi
of Judicial
ve
Proceedings
Jurisdic
tion of
BOC
● Fraud
investi
gation
and
Prosec
ution
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City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
16th week MODULE 9: ● To understand ● Disposi ● CMTA,

and know which tion of related laws,
DISPOSITIO
goods are goods customs/cour
N OF
subject to t cases and
PROPERTY
disposition ● Forfeit IRRs
IN CUSTOMS
ure
CUSTODY ● To know the
Fund ● PC/Internet
types,
conditions and ● Google
limitations of
disposition
References:
● CAO 2-2010
● CAO 3-2020
● CAO 4-2016
● CAO 1-2011
● CAO 4-2003
● CAO
10-2007
● CMO
26-2020
● CMO
40-2019
● CMO 2-2019
● CMO 21 -
2018
● CMO
16-2014
● CMO
24-2005
● CMO 12 –
2006
● CMO 5 –
2003
● CMO 1-2001
● CMO 12 -
2000
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● CMO
11-2000
17th - 18th MODULE 10: ● To explore and ● Seizure ● CMTA, ● To conduct

week apply the and related laws, research, drafting
learnings Forfeit customs/cour and discussion of
CASE throughout the ure t cases and cases pertaining to
ANLYSIS entire course on Cases IRRs the topic
AND both on
customs
RESEARCH admini ● PC/Internet
proceedings
strative
(APPLICATI ● To enhance and ● Google
ON OF skills on solving judicial
PROVISIONS problems level
ON ● To correlate the
CUSTOMS provisions of
PROCEEDIN
CMTA, related
GS)
laws and IRRs
which govern
every specific
topics under the
customs
proceedings
MODULE NO. 1 ADVANCE RULING

I. Introduction
This module will discuss the application process and procedures of advance ruling of
classification, valuation and origin of goods under CMTA and IRRs.
II. Learning Objectives
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● Understand and learn the mechanism of BOC to issue advance rulings on the classification,
valuation, origin of goods and other customs issues;
● To master the rules and procedures on application and issuance of advance ruling;
● To realize the purpose of advance ruling on importation and exportation
● To determine which goods are covered for an advance ruling application
III. Topics and Key Concepts
Advance Tariff Classification Ruling

(Section 1100 & 1103 of RA 10863)
Section 1100. Classification Ruling. – An importer or exporter may file a written application for
an advance ruling on the tariff classification of goods with the Commission. The Commission
shall render a ruling within thirty (30) days from, receipt of a properly documented application.
When a declared tariff classification of goods, not subject of a pending application for advance
ruling, is in dispute, the importer, exporter, or the Bureau shall submit the matter to the
Commission for a ruling, without prejudice to the application of Section 1106 of this Act on
"protest": Provided, That such rulings of the Commission on commodity classification shall be
binding upon the Bureau, unless the Secretary of Finance shall rule otherwise
xxx
Sec. 1103. Conditions for Application and Effect of Advance Ruling. – An application for an
advance ruling shall cover only one (1) product or item. The application for advance ruling shall
be filed at least ninety (90) days before the importation or exportation of the product or item, as
the case may be.
(See below examples of Advance Tariff Classification Ruling)
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City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
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City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
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City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
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City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
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City of Olongapo
GORDON COLLEGE
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COMMISSION ORDER NO. 2017 – 01
SUBJECT: Procedure on Application for an advance ruling on Tariff Classification related to

importation or exportation of goods.
This Commission Order (Order) establishes the procedure for an Advance Ruling system on
tariff classification involving imported and exported goods pursuant to Chapter 1 of Title XI of
Republic Act No. 10863 or the Customs Modernization and Tariff Act (CMTA), consistent with
the Philippine Commitments under the World Trade Organization’s (WTO) Agreement on Trade
Facilitation, the ASEAN Trade in Goods Agreement, World Customs Organization’s (WCO)
Harmonized System Convention, the Revised Kyoto Convention, and other relevant trade
agreements.
Section 1. Scope.
1.1 This covers the procedure on the application for an advance ruling regarding tariff
classification under Section 1100, Chapter 1, Title XI of the CMTA, related to importation
or exportation of goods. In accordance with Sections 1610 and 1611 of the CMTA, tariff
classification refers to the act or process of determining the subheading in the ASEAN
Harmonized Tariff Nomenclature (AHTN) to which goods appropriately belong.
1.2 Applications for an Advance Ruling on tariff classification of goods shall be filed with the
Tariff Commission (Commission) for determination.
1.3 This Order shall also apply to movement of goods into and from free zones.
1.4 Request for Advance Rulings on valuation and rules of origin shall be filed with the
Bureau of Customs (BOC).
Section 2. Objectives.
2.1 To provide rulings on tariff classification of goods prior to their importation or
exportation, in order to add certainty and predictability to international trade and help
importers or exporters make informed decisions based on legally binding rules.
2.2 To enable the establishment of an advance ruling system that is in line with the standards
set out in the Revised Kyoto Convention, the World Trade Organization’s Agreement on
Trade Facilitation, the ASEAN Trade in Goods Agreement, other relevant international
trade facilitation agreements, relevant Philippines laws, and international best customs
practices.
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2.3 To increase the level of stakeholders’ compliance through an informed customs

compliance regime.
Section 3. Definition of Terms.

3.1 Advance Ruling on Tariff Classification – an official written decision issued by the
Commission which provides the Applicant with the appropriate tariff classification of
goods under the AHTN prior to an importation or exportation.
3.2 Applicant – a natural or juridical person who is an importer or exporter requesting for an
Advance Ruling pursuant to this Order.
3.3 ASEAN Harmonized Tariff Nomenclature (AHTN) – an eight – digit commodity

nomenclature adopted by the ASEAN Member States to harmonize their tariff
nomenclatures at the eight-digit level. It adheres to the six-digit commodity classification
code of the Harmonized Commodity Classification and Coding System of the WCO but
adds two digits, with corresponding commodity descriptions, that represent ASEAN
subheadings.
3.4 Authorized Representative – a natural or juridical person duly authorized by the

Applicant in writing to process its application for an Advance ruling.
3.5 Filing Fee – a non-refundable amount assessed by the Commission to be paid by the
Applicant or his/her Authorized Representative to cover the reasonable cost of service
rendered for the issuance of an Advance Ruling.
3.6 Exportation – refers to the act, documentation and process of bringing goods out of
Philippine Territory.
3.7 Exporter – refers to any of the following:
a) Domestic exporter – a natural or juridical person intending to bring goods out of

the Philippines.
b) Foreign exporter – a natural or juridical person in a foreign country intending to

supply goods into the Philippines from a foreign country.
3.8 Importer – a natural or juridical person intending to bring in goods to the Philippines
from a foreign territory, whether for consumption, warehousing or admission.
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3.9 Importation – refers to the act of bringing in goods from a foreign territory into
Philippine territory, whether for consumption, warehousing, or admission. The date of
importation shall be the date of lodgment of goods declaration.
3.10 Goods – refer to articles, wares, merchandize and any other items which are subject to
importation or exportation.
Section 4. Administrative Provisions.

4.1 Who May Apply for an Advance Ruling on Tariff Classification?
An applicant or his/her Authorized Representative may apply for an Advance Ruling.
4.2 Conditions for Application for an Advance Ruling on Tariff Classification.
An application for an Advance Ruling shall cover only one product or good, as determined
by the Commission.
4.3 Period for Filing an Application for an Advance Ruling on Tariff Classification.
Applications for an Advance Ruling should be filed at least ninety (90) days before the
date of the importation or exportation.
4.4 Procedure for Filing an Application for an Advance Ruling on Tariff Classification.
Applicants shall submit three (3) copies of the filled-out application form prescribed by
the Commission together with supporting documents and samples of the good, if required.
The Commission shall assess the sufficiency of the filled-out form and its supporting
documents before payment of appropriate fees and assignment of a unique reference
number.
4.5 Grounds for Non-Acceptance of an Application for an Advance Ruling on Tariff

Classification.
An application for an Advance Ruling may not be accepted in any of the following cases:
a) the application is not in the prescribed application form;

b) it is not possible to determine tariff classification based on the presented,
information/documents;
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c) the request pertains to multiple goods under different subheadings as ascertained by

the Commission;
d) the application is filed less than ninety (90) days before importation or exportation; or
e) non-payment of filing fee
4.6 Submission of Additional Information and On-site Verification
Within (10) calendar days, the Commission shall acknowledge receipt of the application
and notify the Applicant of the need for additional information and on-site verification.
However, should the Commission deem that more information/verification is required, it
may request information/verification from the Applicant anytime during the prescribed
period to issue a ruling.
The Applicant should submit additional information or on-site verification, the running of
the 30-day period to issue a ruling shall stay.
4.7 Grounds for Non-Issuance of Advance Ruling on Tariff Classification
The Commission may not issue an Advance Ruling in any of the following cases:
a) when the Applicant fails to provide any additional information requested within the
reasonable period required by the Commission, without prejudice to the filing of a new
application;
b) the goods involved are subject of a pending court litigation or of an administrative

review or of an appeal involving tariff classification;
c) the Applicant did not allow the Commission to conduct on-site verification;
d) misrepresentation; or
e) other similar cases
In all cases, the Commission shall promptly notify the Applicant in writing, setting out the
reasons therefor.
4.8 Withdrawal of Application for an Advance Ruling on Tariff Classification
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An Applicant may withdraw, in writing, its application at any time before the issuance of
an Advance Ruling.
4.9 Issuance of an Advance Ruling on Tariff Classification
The Commission shall issue the Advance Ruling within thirty (30) days from receipt of
the application, sufficient in form and substance, or upon the submission of all additional
documents required, as the case may be.
Original copies of the Commission’s Advance Ruling shall be furnished to the Applicant,
the BOC Commissioner, and the Secretary of Finance (Secretary).
Pursuant to Paragraph 2, Section 1100 of the CMTA, tariff classification rulings of the
Commission shall be binding upon the BOC.
In the instance that the BOC deems the ruling to be adverse to the government, it shall,
within five (5) days from receipt of a copy of the Advance Ruling, elevate the same to the
Secretary of Finance for review pursuant to Section 1128 of the CMTA.
The Secretary of Finance shall automatically review the Ruling within 15 days from
receipt of the BOC notice. When no ruling is rendered within the period, the decision of
the Commission is deemed confirmed.
The Commission shall be furnished a copy of the BOC notice of elevation and the
decision of the Secretary of Finance.
4.10 Effectivity of an Advance Ruling on Tariff Classification.
The Advance Ruling shall be effective from the date it is issued.

4.11 Validity of an Advance Ruling on Tariff Classification
The Advance Ruling shall be valid for a period of five (5) years from the date of its
issuance unless it is earlier revoked or modified due to changes in facts or circumstances
on which the Advance Ruling is based,
4.12 Modification or Revocation of an Advance Ruling on Tariff Classification.
The Advance Ruling may be modified whenever there is an error, change in material
facts/circumstance, changes in the law or judicial decision, or change in policy, as the case
may be. Modification of Advance Ruling is of prospective application.
The Advance Ruling may be revoked by the Commission upon discovery of any false or
misleading material information provided in the application without prejudice to the filing
of criminal, civil and/or administrative cases against the Applicant.
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In case a Ruling is revoked or modified the Commission shall give a written notice to the
Applicant or issue a public notice setting out the relevant facts and the basis for the
revocation or modification.
The Secretary and the BOC Commissioner shall be furnished copy of the issued notices at
all times.
Section 5. Motion for Reconsideration.
5.1 Motion for Reconsideration.
The Applicant in an Advance Ruling may file a motion for reconsideration with the
Commission, in writing, within ten (10) days from receipt thereof, on the ground of
mistake of fact and excusable negligence or newly discovered evidence or information not
discovered during the application that if presented may later the result of the Advance
Ruling. The Commission shall resolve the Applicant’s motion within ten (10) days from
receipt thereof.
5.2 Only one (1) motion for reconsideration is allowed.

Section 6. Appeal.
An appeal may be filed by the Applicant before the Court of Tax Appeals within thirty (30)
days from receipt of the decision of the Commission denying its motion for reconsideration, or
of the decision of the Secretary of Finance pursuant to the last paragraph of Sec. 4.9 hereof, as
the case may be.
Section 7. Publication and Confidentiality.
7.1 The Commission shall publish its Advance Rulings on its website and deposit a copy of
the same in its Records Section.
7.2 All information that is provided on a confidential basis for purposes of the Advance
Ruling application shall be treated as confidential. The information shall not be disclosed
unless with the written permission of the Applicant or government agency who provided
such information or to the extent that it may be required to be disclosed in the context of
judicial proceedings.
Section 8. Use of information and Communications Technology.

To the extent practicable, the Commission shall use information and communications technology
to process and issue Advance Rulings.
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Section 9. Construction and Interpretation.

This Order shall be interpreted, construed and implemented pursuant to the intents and
purposes of the Declaration of Policy in Section 101 of the CMTA.
Section 10. Periodic Review
Unless otherwise provided, this Order shall be reviewed every three (3) years and be amended or
revised, if necessary.
Section 11. Separability Clause.
If any part of this Order is declared unconstitutional or contrary to existing laws and government
policies, the other parts not so declared shall remain in full force and effect.
Section 12. Repealing Clause.
All previously issued Commission Orders and other rules and regulations which are inconsistent
with this Order are hereby repealed and/or modified accordingly.
Section 13. Effectivity
This Order shall take effect fifteen (15) days after its complete publication in the Official
Gazette or in a newspaper of general circulation.
The Office of National Administrative Register of the UP Law Center shall be provided three
(3) certified copies of this Order.
MARILOU P. MENDOZA
Chairperson
Date: 29 August 2017
APPROVED:
CARLOS G. DOMINGUEZ III

Secretary of Finance
Advance Ruling on Valuation and Rules of Origin

Sec. 1101. Valuation Ruling. – An importer or exporter may file a written application for an
advance valuation ruling on the proper application of a specific method on customs valuation of
specific goods as prescribed in Title VII, Chapter 1 of this Act.
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The application for a valuation ruling shall be filed with the Commissioner who shall issue a
ruling within thirty (30) days from submission of the application form and supporting documents
as may be required by rules and regulations.
When the valuation method of goods not subject of an application for advance valuation ruling
or the declared customs value is in dispute, the matter shall be resolved in accordance with
Section 1106 of this Act on "protest".
Sec. 1102. Ruling on the Rules of Origin. – An importer or exporter may file a written
application for a ruling on whether the goods qualify as originating under the rules of origin of
the applicable preferential trade agreement. The application for an advance ruling on origin shall
be filed with the Commissioner who shall act on the application within thirty (30) days from
receipt of the application and supporting documents as may be required by rules and regulations.
When the declared origin of the goods, not subject of a request for advance ruling on origin, is in
dispute, the matter shall be resolved in accordance with Section 1106 of this Act on "protest".
Sec. 1103. Conditions for Application and Effect of Advance Ruling. – An application for an
advance ruling shall cover only one (1) product or item. The application for advance ruling shall
be filed at least ninety (90) days before the importation or exportation of the product or item, as
the case may be.
Customs Administrative Order (CAO) No. 3-2016
SUBJECT: Establishment of an Advance Ruling System for Valuation and Rules of Origin
INTRODUCTION: This CAO establishes an Advance Ruling System in the Bureau of Customs
for Valuation and Rules of Origin, pursuant to Sections, 1100-1104, Chapter I, Title XI in
relation to Section 204, Chapter I, Title II; Section 1105, Chapter I, Title XI and other related
provisions of Republic Act No. 10863, otherwise known as the Customs Modernization and
Tariff Act (CMTA), taking into account the commitments of the Philippines to the World Trade
Organization’s Agreement on Trade Facilitation (ATF), the Revised Kyoto Convention (RKC),
the ASEAN Trade in Goods Agreement (ATIGA), and other relevant trade agreements entered
into by the Philippines.
Section 1. Scope.
1.1 This covers the establishment of an Advance Ruling System on customs valuation
methodology and preferential and non-preferential rules of origin.
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1.2 Requests for Advance Rulings concerning the tariff classification of goods shall be filed
with the Tariff Commission for determination.
1.3 Requests for rulings on other matters related to importation or exportation of goods as
provided in Section 113 of the CMTA, including exportation of goods originating in the
Philippines shall be covered by existing regulations.
2.1 To provide rulings on the origin and valuation methodology of goods prior to their
importation or exportation, in order to add certainty and predictability to international
trade and help commercial importers or foreign exporters make informed business
decisions based on legally binding rules.
2.2 To help ensure uniformity and consistency in the application of customs policies, rules
and regulations on customs valuation and rules of origin.
2.3 To enable the establishment of an Advance Ruling System that is in line with the
standards set out in the Revised Kyoto Convention, the World Trade Organization’s
Agreement on Trade Facilitation, the ASEAN Trade in Goods Agreement, other relevant
international trade facilitation agreements, relevant Philippine laws, and international best
customs practices.
2.4 To increase the level of stakeholders’ compliance through an informed customs

compliance regime.
Section 3. Definition of Terms. For purposes of this CAO, the following terms are defined
accordingly:
3.1 Advance Ruling – an official written and binding ruling issued by the Commissioner of
the Bureau of Customs (BOC) which provides the Requesting Person with an assessment
of: (1) origin, or (2) treatment to be applied on a certain element of customs value, prior to
an import or export transaction for a specified period.
3.2 Fee – the non-refundable amount assessed by the Bureau to be paid by a Requesting
Person to cover the reasonable cost of the research and other services rendered for
issuance of Advance Ruling.
3.3 Foreign Exporter – a natural or juridical person intending to export any goods or
commodities from a foreign country to the Philippines.
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3.4 Importer – a natural or juridical person intending to import any goods into the
Philippines.
3.5 Requesting Person – a natural or juridical person who is an importer, foreign exporter, or
his/her/its authorized agent, who/which is requesting an Advance Ruling pursuant to this
CAO.
Section 4. Administrative Provisions.

4.1 Who May Request for Issuance of Advance Ruling. Importer or Foreign Exporter or its
authorized agent may request an Advance Ruling.
4.2 Requirements for Requests for Advance Ruling.
4.2.1. Period to Request Advanced Ruling for the Importation of Goods . To

ensure that an Advance Ruling request does not relate to any ongoing trade
transaction, a request for Advance Ruling should be submitted to the Bureau at
least ninety (90) calendar days before the date of the importation in question,
which is the date of lodgement of goods declaration.
4.2.2. Other Requirements.
a. A request for Advance Ruling must be made in writing to be submitted to the

Bureau, and must relate only to one good r product, as the case may be.
b. The Bureau shall specify the information to be provided, the format to be
used and the documentary requirements for the request. The Bureau shall allow
the electronic submission of requests, subject to the submission of certified
request for Advance Ruling. No request for Advance Ruling shall be accepted
or considered without such proof payment.
4.2.3 Effects of Failure to Comply with the Requirements. Any request that does
not comply with all of the provisions of this CAO will be rejected and returned
to the Requesting Person. A written order identifying the information missing
from the request and with a clear statement why a ruling cannot be issued shall
be sent to the Requesting Person.
4.3 Acknowledgement of Receipt; Notice to Provide Additional Information and/ or

Documents.
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4.3.1. The Bureau shall, within fifteen (15) working days, acknowledge the receipt of
the application, through the fastest available means.
4.3.2. At any time during the course of an evaluation of a request for Advance Ruling,
the Bureau may require additional information from the Requesting Person
which shall be submitted within (30) calendar days from the date of receipt of
the notice. Such period may be extended upon request.
4.4 Withdrawal of Request. The request is deemed withdrawn under the following instances:
4.4.1. Expressly at the instance of the Requesting Person at any time before an
Advance Ruling is issued.
4.4.2. Impliedly when:
a. The Requesting Person imports the subject matter of the request for
Advance Ruling less than ninety (90) days after the request or less than
thirty (30) days from submission of complete documents, as the case may
be.
b. The Requesting Person fails to submit the additional information and/or
documents within the prescribed of extended period from notice by the
Bureau.
4.5 Revalidation of Advance Ruling.
4.5.1. Request for revalidation of Advance Ruling shall be submitted to the Bureau at
least ninety (90) calendar days before the expiration of the validity of Advance
Ruling.
4.5.2. The Bureau may require additional requirements in support of the request of
revalidation of Advance Ruling.
4.6 Period to Issue Advance Ruling and its Revalidation. The Bureau shall issue the
Advance Ruling or its Revalidation within thirty (30) working days from the date of
receipt of the request, or additional documents or information, as the case may be.
4.7 Grounds for Declining.
4.7.1. The issuance of an Advance Ruling may be declined in the following cases:
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a. The issue involves a matter that is before the courts or is the subject of an
administrative review, or under post clearance audit;
b. A request for Advance Ruling on the same goods is already filed by the same
Requesting Party; however, an earlier request filed by an agent shall be
declined if a latter request is filed by the principal;
c. An Advance Ruling on the same goods has been issued to the same
Requesting Person; and
d. The request is based on hypothetical situation.
4.7.2. In all cases, if the issuance of an Advance Ruling is declined, the Bureau shall
promptly notify the Requesting Person in writing, though electronic means,
clearly stating the reasons for such.
4.8 Binding Effect and Period of Effectivity of an Advance Ruling.
4.8.1. An Advance Ruling benefits only the Requesting Person. Although an applicant
may refer to specific Advance Ruling issued to another importer, foreign
exporter, or producer, the Bureau is not bound to recognize and apply that
ruling to a similar importation.
4.8.2. An Advance Ruling shall take effect on the date it is issued, unless another date
is specified in the ruling, provided that the facts or circumstances on which the
ruling is based remain unchanged as of the time importation. The Advance
Ruling shall be valid for a period of three (3) calendar years from date of its
issuance, unless a shorter period is provided for in the ruling due to the nature
of the application – which shall be clearly stated in the Advance Ruling.
4.9 Modification, Revocation or Invalidation of an Advance Ruling.
4.9.1. Modification of Advance Rulings. Advance Rulings may be modified based

on the following grounds:
a. Clerical error;
b. Change of material facts and circumstances after issuance of the Ruling;
c. Misleading information based on excusable neglect or honest mistake;
and
d. Change in applicable law
Modification of Advance Rulings is, as a general rule, of prospective

application.
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4.9.2. Revocation or Invalidation of an Advance Ruling. An Advance Ruling may

be revoked or invalidated upon discovery that the applicant submitted
incomplete, incorrect, false or misleading information. Revocation on
invalidation of Advance Rulings shall be retroactive.
4.9.3. Notification. Where the Advance Ruling is modified, revoked or invalidated,

the Bureau shall give written notice to the Requesting Person setting out the
relevant facts and the basis for its decision.
4.10 Appellate Remedy. The Requesting Person aggrieved by the Ruling of the Bureau or its
decision to modify, revoke, or invalidate an Advance Ruling may, within fifteen (15)
calendar days, from receipt of the Ruling or decision, file a motion for reconsideration, the
Requesting Person may, within thirty (30) calendar days from the receipt of the denial,
appeal the adverse ruling to the Court of Tax Appels (CTA).
4.11 Publication of Advance Ruling and Confidentiality. The Bureau shall publish the
summaries of the Advance Rulings on its website, taking into account the need to protect
commercially confidential information.
4.12 Unique Reference Number. The Bureau shall develop a Unique Reference Number for
every Request and every Advance Ruling.
4.13 Use of information and Communications Technology (ICT) – Enabled System. To the
extent practicable, the Bureau shall use ICT – enabled system on Advance Ruling with
respect to request for ruling, notification, issuance of Advance Rulings and such other
related processes.
Section 5. Authority of the Commissioner to Issue Supplementary Rules and Regulations.

The Commissioner of Customs may issue supplementary rules and regulations to effectively
implement the provisions of this CAO.
Section 6. Periodic Review. Unless otherwise provided, this CAO shall be reviewed every three
(3) years and be amended or revised, if necessary.
Section 7. Separability Clause. If any part of this CAO is declared unconstitutional or contrary
to existing laws, the other parts not so declared shall remain in full force and effect.
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Section 8. Repealing Clause. All previously issued Customs Administrative Orders, Customs
Memorandum Orders, and other customs rules and regulations which are inconsistent with this
CAO are hereby repealed and/or modified accordingly.
Section 9. Effectivity. This CAO shall take effect fifteen (15) days after its complete publication
in the Official Gazette or a newspaper of general circulation.
The office of National Administrative Register (ONAR) of the UP Law center shall be provided
a three (3) certified copies of this CAO.
NICANOR E. FAELDON
Commissioner
Date: 03 October 2016
APPROVED:
CARLOS G. DOMINGUEZ III

CUSTOMS MEMORANDUM ORDER NO. 30 – 2016

SUBJECT: Guidelines in the Implementation of an Advance Ruling System for Valuation
and Rules of Origin Pursuant to CAO 03-2016
1.1. To implement Customs Administrative Order No. 03-2016 establishing an Advance
Ruling System in the Philippines regarding customs valuation method, preferential
and non-preferential origin of goods.
1.2. To establish the parameters and procedures for Advance Ruling requests.
1.3. To provide for all administrative matters with respect to the issuance, denial,
revocation, modification, and publication of Advance Rulings.
Section 2. General Provisions.

2.1. To request for Advance Rulings shall be submitted to the Bureau electronically and
application fees shall be paid through bank payment.
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2.2. Standard procedures and the required application forms for Advance Rulings shall be
punished on the Bureau’s website. These forms shall be used for all Advance Ruling
requests.
2.3. Advance Rulings shall be published on the Bureau’s website, with any information
that is claimed to be confidential shall be redacted.
2.4 A non-refundable Advance Ruling Application Fee in the amount of One Thousand
Five Hundred Pesos (Php1,500.00) shall be collected by the Bureau for each request
which must relate only to one product or item.
Section 3. Operational Provisions.

3.1. Request for Advance Ruling.
3.1.1. An Importer or Foreign Exporter or its authorized agent shall apply

electronically for an Advance Ruling to the Office of the Commissioner
(Attention: Technical Support Team – Advance Ruling), together with
the presentation of proof of payment of non-refundable Advance Ruling
Application Fee.
3.1.2. Payment of Fee. A Requesting Person shall accomplish the

downloadable Advance Ruling Order Payment Form in the BOC
Website and shall pay the same to the Bureau’s In-house Bank (Land
Bank of the Philippines).
The In-House Bank shall issue BOC – Official Receipt (BCOR) as proof
of payment once the payment was made.
A standard Advance Ruling Payment Form is attached as Appendix C.
For Foreign Exporters, proof of international wire transfer shall be

sufficient subject to verification by the BOC that the payment has been
made.
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3.1.3. Receipt of Request for Advance Ruling. Upon receipt of request for
Advance Ruling, the Bureau shall notify in writing, through electronic
means, the Requesting Person that the request for Advance Ruling has
been received.
The Bureau may request the Requesting Person to supply additional

information it deems necessary for a ruling to be issued on the
application. Until such time the requested document or information is
submitted or a written manifestation is made that such document or
information cannot be submitted, the 30 working days period will not
toll.
3.2. General Requirements for Request for Advance Ruling. A request for Advance
Ruling contain all information necessary to process the request, including the
following:
a. Full name and address of the Requesting Person (including the Tax Identification
Number (TIN), except if the Requesting person is a Foreign Exporter);
b. Name, telephone number, and e-mail address of the contact person, who should
have full knowledge of the goods at issue and to whom the Bureau may direct any
inquiries or communication;
c. A statement as to whether the Requesting Person is an Importer, a producer (the

producer of the goods in question, and if so, whether the producer directly exports
the goods to the Philippines), or a Foreign Exporter (a person exporting goods to
the Philippines who is not the producer of those goods);
d. If the Requesting Person is an Importer, the name and address of the exporter
and/or producer should be included. If the Requesting Person is a Foreign
Exporter, the request should include the name and address of the producer,
Importer (if not the same person) and the name and address of the of local agent. If
the Requesting Person is the producer, name and address of the exporter (if not the
same person), and that of the Importer(s) should be included;
e. Where the request is made by a third party agent (acting on behalf of an Importer,
Foreign Exporter, or producer), the name, address, and contact information of the
agent requesting the Advance Ruling should be indicated. This must be
accompanied by an Authorization Letter (written statement) which need not be
notarized, signed by the person for whom the Advance Ruling is intended granting
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the agent authorization to act on behalf of the Importer, Foreign Exporter, or

producer. The ruling will be issued in the name of the Importer, Foreign Exporter,
or producer;
f. Include a statement, on the basis of the Requesting Person’s knowledge, as to

whether the goods that are the subject of the request for Advance Ruling has
previously been imported into the Philippines;
g. A detailed description of the goods;
h. Whether any information shall be treated as confidential;
If a Requesting Person has difficulty obtaining proprietary information from the

producer or foreign supplier, they may request the producer or foreign supplier to
electronically send the information directly to the Bureau. All proprietary information
provided to the Bureau should be treated as confidential and shall only be used for that
particular purpose; and
3.2.1. In addition to the General Requirements provided in Section 3.2, a request

regarding origin shall also include the following information:
a. The country of origin envisioned for the goods;
b. The applicable basis for claiming origin, stating that the request for
Advance Ruling is to claim preferential tariff treatment;
c. Any samples as necessary, photographs, plans, catalogues, copies of

technical literature, brochures, laboratory analysis results, or other
documents available on the composition of the goods and their
component materials which may assist in describing the manufacturing
process or the processing undergone by the materials or any other
documents that may assist the Bureau in determining the origin of the
goods.
Physical samples may be sent in through courier or personal delivery

indicating in the package the Unique Reference Number as provided in
Section 4.12 of CAO 03 – 2016;
d. The conditions enabling origin to be determined, the materials used and

their origin, tariff classification corresponding values, and description of
the circumstances (rules on change of tariff heading, value added,
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description of the manufacturing process, or any other specific origin

rule) enabling the conditions in question to be met (the exact rule of
origin applied shall be cited); and
e. Whether the goods in question are the subject of an origin verification

process, or any instance of appeal or review before any governmental
agency, appellate tribunal, or court;
A standard application form for Advance Rulings on Origin is attached as

Appendix A.
3.2.2. In addition to the General Requirements provided in Section 3.2, a request for
valuation method shall also include the following information:
a. The valuation method envisioned for the goods;
b. The legal basis for the claimed valuation method;
c. A description of the nature of the transaction (contract terms, etc.);
d. Any relationship between the parties (including whether such relationship

will affect contract price);
e. Specific information depending on the valuation issue in question. (For

example, if the issue is whether a commission paid by the buyer is a
buying commission or a selling commission, all details and
documentation relating to the roles of the parties and the payment of the
commission should be submitted. If the issue concerns a royalty payment,
the license or royalty agreement and sales contract should be included);
and
f. Other relevant documents;
A statement by the Requesting Person that to the best of his or her knowledge
there are no issues concerning the transaction for which the ruling is sought
pending before the Bureau or any other governmental agency, tribunal, or
court;
Whether advice was previously sought from the Bureau concerning the
transaction, and if so, from whom and what advice was given.
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A standard request form for Advance Rulings on valuation method is

attached as Appendix B.
3.3. Withdrawal of Request. A requesting Person may withdraw the request at any time
before the Bureau decides on the application in such case, the application shall be
terminated as of the date of the receipt of the written withdrawal.
A withdrawal of the request shall not prohibit the filing of another request on the same
subject.
3.4 Issuance of Advance Rulings. The Bureau shall issue Advance Rulings or its
Revalidation within thirty (30) working days from the date of receipt of the request, or
from submission of additional documents or information, as the case may be. Advance
Rulings shall be issued in writing addressed to the Requesting Person, redacting those
matters considered as confidential, with a notification of the Requesting Person's right
to appeal the decision.
3.5 Declining or Postponing the Issuance of Advance Rulings.
3.5.1. The issuance of an Advance Ruling may be declined in the following cases:
a. The issue involves a matter that is pending before the courts or is the
subject of an administrative review, or under post clearance audit;
b. A request for Advance Ruling on the same goods is already filed by the
same Requesting Party; however, an earlier request filed by an agent
shall be declined if a latter request is filed by the principal;
c. An Advance Ruling on the same goods has been issued to the same
Requesting Person; and
d. The request is based on hypothetical situation.
3.5.2. In all cases, if the issuance of an Advance Ruling is declined, the Bureau
shall promptly notify the Requesting Person in writing, through electronic
means, clearly stating the reasons for such.
3.6 Technical Support Team for Advance Ruling. The TST - AR shall be directly under
the Office of the Commissioner and shall provide the technical support in
implementing the Advance Ruling System.
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The Commissioner may assign a Deputy Commissioner in charge of the TST - AR.
3.7 Process Flow. A table illustrating the process flow for Advance Ruling applications
and issuance is attached as Appendix D. This process may be changed from time to
time in order to improve the administration of the Advance Ruling System and to
reflect changes in the Bureau's administrative and information technology systems.
3.8 Monitoring and Implementation Mechanism. The Commissioner shall establish an

implementation and monitoring plan to guide the implementation and evaluation of the
effectiveness of the Advance Ruling System. For this purpose, the MISTG shall
develop a database system that will capture, record and generate reports on all data
and information on Advance Ruling requests and issuances.
Section 4. Penalties.
4.1. Commission of any of the acts mentioned below shall be penalized as follows:
a. Intentional misrepresentation of any material fact regarding an application for

Advance Ruling shall be penalized by the rejection of the request, and the
revocation of an advance ruling if it has been issued; or
b. Submission to the Bureau of counterfeit or otherwise false or inaccurate

documents in support of a request for Advance Ruling shall be penalized by
the rejection of the application, and the revocation of an advance ruling if it
has been issued.
Revocation of an Advance Ruling shall be of retroactive application.
4.2. The above penalties shall be without prejudice to the imposition of other
penalties under the Customs Modernization and Tariff Act, and other applicable
laws, rules, and regulations.
Section 5. Miscellaneous Provisions.

5.1. Requesting Person shall keep all supporting records relating to their request for
Advance Ruling for not less than three (3) years from the date the request is
submitted to the Bureau.
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5.2. The Bureau shall retain all requests for Advance Rulings and supporting records
for not less than three (3) years from the date the request is submitted.
Section 6. Effectivity. This CMO shall take effect immediately.

xxx
Notes on the Completion of Application for Customs Advance Ruling on Origin
The following explanatory notes provide specific guidance on the completion of Appendix A.
Please read them carefully before completing your request for Advance Ruling.
Box 1. Details of Requesting Person

For these purposes, a Requesting Person means an Importer or Foreign Exporter who or which is
requesting for Advance Ruling on rules of origin on goods that will be imported into or exported
from the Philippines. All required information should be provided. The name of the authorized
representative (e.g., agent) should be indicated, if applicable. A written authorization should also
be submitted.
Box 2. Contact Person

At any time during the evaluation of the goods, the Bureau may require classification or
additional information from the Requesting Person. He or she may designate a contact person
with access to technical information about the goods.
Box 3. Details of Goods

The product or trade name is the name by which the goods are known to trader and
manufacturers and/or which is indicated in the import or export documents.
For imports, the country of origin refers to the country or state where the goods were produced or
manufactured, and not the port of origin. This information is needed for determining the origin of
the goods.
Requesting Persons may indicate the tariff classification (Harmonized System Code) of the
goods in the country of origin, if known and attach supporting document.
The description of the goods should be sufficient to enable the goods to be identified. Requesting
Person may include information about the composition of the goods, production process,
properties, structure, function, intended use, packaging, and other pertinent information.
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Box 4. Enclosures Submitted

Any samples, technical catalogs or brochures, duly certified composition, plans, photographs or
other documents available, which may assist in determining the origin of the goods, should be
submitted.
Box 5. Certification
By printing his or her name and affixing his or her signature, the Requesting Person certifies
under the penalty of perjury and falsification of public documents under RA 3815 otherwise
known as Revised Penal Code of the Philippines and RA 8792 otherwise known as the
E-commerce act of 2000 that all information and enclosure(s) being submitted are true and
correct and relate to the goods applied for Advance Ruling on rules of origin.
Furthermore, Requesting Person commits that any additional information required will be
submitted within thirty (30) calendar days from the date of receipt of request from the Bureau.
*Pursuant to Section 1103 of the Customs Modernization and Tariff Act (CMTA), an application
for Advance Ruling on rules of origin shall cover one (1) product or item only. It shall be filed at
least ninety (90) calendar days before the date of importation or exportation in question, which is
the date of lodgement of goods declaration.
**An Advance Ruling on rules of origin is not a decision on whether or not the goods may be
prohibited or regulated import or export. It is the responsibility of the Importer or Foreign
Exporter to ensure that the goods are not prohibited and secure the required import or export
clearance if the goods are regulated.
***Any confidential information should be properly redacted.
Notes on the Completion of Appendix B
The following explanatory notes provide specific guidance on the completion of Appendix B.
Please read them carefully before completing your request for Advance Ruling.
Box 1. Details of Requesting Person

For these purposes, a Requesting Person means an Importer or Foreign Exporter who or which is
requesting for Advance Ruling on valuation method on goods that will be imported into or
exported from the Philippines. All required information should be provided. The name of the
authorized representative (e.g., agent) should be indicated, if applicable. A written authorization
should also be submitted.
Box 2. Contact Person

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At any time during the evaluation of the goods, the Bureau may require classification or
additional information from the Requesting Person. He or she may designate a contact person
with access to technical information about the goods.
Box 3. Details of Goods

The product or trade name is the name by which the goods are known to trader and
manufacturers and/or which is indicated in the import or export documents.
For imports, the country of origin refers to the country or state where the goods was produced or
manufactured, and not the port of origin. This information is needed for determining the origin of
the goods.
Requesting Persons may indicate the tariff classification (Harmonized System Code) of the
goods in the country of origin, if known and attach supporting document.
The description of the goods should be sufficient to enable the goods to be identified. Requesting
Person may include information about the composition of the goods, production process,
properties, structure, function, intended use, packaging, and other pertinent information.
Box 4. Enclosures Submitted

Any samples, technical catalogs or brochures, duly certified composition by the Supplier, plans,
photographs or other documents available, which may assist in determining the correct valuation
of the goods, should be submitted.
Box 5. Certification
By printing his or her name and affixing his or her signature, the Requesting Person certifies
under the penalty of perjury and falsification of public documents under RA 3815 otherwise
known as Revised Penal Code of the Philippines and RA 8792 otherwise known as the
E-commerce act of 2000 that all information and enclosure(s) being submitted are true and
correct and relate to the goods applied for Advance Ruling on rules of origin.
Furthermore, Requesting Person commits that any additional information required will be
submitted within thirty (30) calendar days from receipt of request from the Bureau.
*Pursuant to Section 1103 of the Customs Modernization and Tariff Act (CMTA), a request for
Advance Ruling on valuation shall cover one (1) product or item only. It shall be filed at least
ninety (90) days before importation or exportation of the product or item.
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**An advance ruling on valuation is not a decision on whether or not the goods may be
prohibited or regulated import or export. It is the responsibility of the Importer or Foreign
Exporter to ensure that the goods is not prohibited and secure the required import or export
clearance if the goods are regulated.
***Any confidential information should be properly redacted.
Note: Below is the list of customs/tariff issuances which are relevant on this module. Kind read
and determine which provision/s is/are newly promulgated, still effective, amended, revoked
and/or superseded. To access the copy, you may click the link given below.
Relevant Customs/Tariff Issuances

Customs/Tariff Description Link
Issuances
TC Order 2017-01 Procedure on Application for an https://drive.google.com/file/d/0

(Advance Rulings) Advance Ruling on Tariff Classification B6XF3AhfubONR0I2ZkxUZDJ
related to importation or exportation of yem8/view
goods
Citizen's Charter Step https://drive.google.com/file/d/1

Guide (Advance Y9-HX66_TSaIRmIdIhIuVIBo
Ruling) hnIxUDiK/view
https://drive.google.com/file/d/1
A2eFwpkQ4ieiu52egWO43Rti0
TC Procedure kiCMVIn/view
CAO 03-2016 Establishment of an Advance Ruling https://customs.gov.ph/wp-conte

System for Valuation and Rules of nt/uploads/2016/10/cao-03-2016
Origin -Establishment-of-an-Advance-
Ruling-System-for-Valuation-an
d-Rules-of-Origin-UP.pdf
CMO 30-2016 Guidelines in the Implementation of an https://customs.gov.ph/wp-conte

Advance Ruling System for Valuation nt/uploads/2016/10/cmo-30-201
Rules of Origin Pursuant to CAO 6-Guidelines-in-the-Implementa
03-2016 tion-of-an-Advance-Ruling-Syst
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em-for-Valuation-Rules-of-Orig
in-Pursuant-to-CAO-03-.pdf
MODULE 1
ACTIVITY 1.
I. Answer the following Questions.
1. Who may apply for an advance Tariff Classification Ruling?
2. What are the conditions for application for an advance Tariff Classification Ruling?
3. What is the period for filing the application for an advance Tariff Classification Ruling?
4. Explain the procedure on filing the application for an advance Tariff Classification Ruling?
5. What are the grounds for non-acceptance of an Application for an Advance Ruling on Tariff
Classification and for non-issuance of an advance ruling on Tariff Classification?
II.
1. In customs valuation ruling, what are the adjustments and permissible deductions?
2. Enumerate briefly the process flow of advance ruling request for rules of origin and valuation?
3. In what cases the issuance of an advance ruling on valuation or origin may be declined?
MODULE NO. 2 DISPUTE SETTLEMENT & PROTEST
I. Introduction
This module will discuss the right of an administrative remedies of an aggrieved importer
or exporter pertaining to dispute settlement or protest arising from customs valuation, rules of
origin, tariff classification, and other customs issues.
● To determine the conditions that shall be taken into consideration in applying

administrative remedies
● To familiarize the rules and procedures relating to this topic
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III. Topics and Key Concepts
Dispute Settlement & Protest

[RA 10863]
Relevant Definition of Terms

(Section 102, CMTA)
Appeal refers to the remedy by which a person who is aggrieved or adversely affected by any
action, decision, order, or omission of the Bureau, seeks redress before the Bureau, the Secretary
of Finance, or competent court, as the case may be.
Security refers to any form of guaranty, such as a surety bond, cash bond, standby letter of
credit or irrevocable letter of credit, which ensures the satisfaction of an obligation to the Bureau.
Tentative Release refers to a case where the assessment is disputed and pending review, an
importer may put up a cash bond equivalent to the duties and taxes due on goods before the
importer can obtain the release of said goods.
Sec. 114. Right of Appeal, Forms and Ground. – Any party adversely affected by a decision or
omission of the Bureau pertaining to an importation, exportation, or any other legal claim shall
have the right to appeal within fifteen (15) days from receipt of the questioned decision or order.
An appeal in writing shall be filed within the period prescribed in this Act or by regulation and
shall specify the grounds thereof.
The Bureau may allow a reasonable time for the submission of supporting evidence to the
appeal.
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Sec. 425. Tentative Assessment of Goods Subject to Dispute Settlement. – Assessment shall be
deemed tentative if the duties and taxes initially assessed are disputed by the importer. The
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assessment shall be completed upon final readjustment based on the tariff ruling in case of
classification dispute, or the final resolution of the protest case involving valuation, rules of
origin, and other customs issues.
The District Collector may allow the release of the imported goods under tentative assessment
upon the posting of sufficient security to cover the applicable duties and taxes equivalent to the
amount that is disputed.
xxx
Sec. 1100. Classification Ruling. – An importer or exporter may file a written application for an
advance ruling on the tariff classification of goods with the Commission. The Commission shall
render a ruling within thirty (30) days from, receipt of a properly documented application.
When a declared tariff classification of goods, not subject of a pending application for advance
ruling, is in dispute, the importer, exporter, or the Bureau shall submit the matter to the
Commission for a ruling, without prejudice to the application of Section 1106 of this Act on
"protest": Provided, That such rulings of the Commission on commodity classification shall be
binding upon the Bureau, unless the Secretary of Finance shall rule otherwise.
Sec. 1101. Valuation Ruling. – An importer or exporter may file a written application for an
advance valuation ruling on the proper application of a specific method on customs valuation of
specific goods as prescribed in Title VII, Chapter 1 of this Act.
The application for a valuation ruling shall be filed with the Commissioner who shall issue a
ruling within thirty (30) days from submission of the application form and supporting documents
as may be required by rules and regulations.
When the valuation method of goods not subject of an application for advance valuation ruling
or the declared customs value is in dispute, the matter shall be resolved in accordance with
Section 1106 of this Act on "protest".
Sec. 1102. Ruling on the Rules of Origin. – An importer or exporter may file a written
application for a ruling on whether the goods qualify as originating under the rules of origin of
the applicable preferential trade agreement. The application for an advance ruling on origin shall
be filed with the Commissioner who shall act on the application within thirty (30) days from
receipt of the application and supporting documents as may be required by rules and regulations.
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When the declared origin of the goods, not subject of a request for advance ruling on origin, is in
dispute, the matter shall be resolved in accordance with Section 1106 of this Act on "protest".
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Sec. 1104. Administrative and Judicial Appeals. – An aggrieved party may, within thirty (30)
days from receipt of an adverse ruling or decision, appeal the same to the CTA without prejudice
to the authority of the Secretary of Finance to review decisions adverse to the government in
accordance with Sections 1127 and 1128 of this Act, as the case may be.
SEC, 1105. Implementing Rules and Regulations. – The Secretary of Finance, upon the
recommendation of the Bureau and the Commission, shall promulgate rules and regulations to
implement the preceding provisions on advance ruling.
CUSTOMS ADMINISTRATIVE ORDER (CAO) NO. 02-

2020 SUBJECT: DISPUTE SETTLEMEN AND PROTEST
Introduction. This CAO prescribes the policies, guidelines and procedures on dispute settlement
and protest in the Bureau of Customs (Bureau), pursuant to Sections 114, Chapter 2, Title I;
Section 425, Chapter 3, Title IV; Sections 1100 to 1102, Section 1104, Chapter 1, Title XI;
Sections 1106 to 1110, Chapter 2, Title XI, Section 1126, Chapter 5, Title XI; Section 1128,
Chapter 5, Title XI; and Section 1136, Chapter 9, Title XI of Republic Act No. 10863, otherwise
known as the Customs Modernization and Tariff Act (CMTA).
Section 1. Scope. This CAO shall cover the right to administrative remedies of an aggrieved
importer or exporter pertaining to dispute settlement or protest arising from customs valuation,
rules of origin, tariff classification, and other customs issues.
2.1 To provide fair and expeditious resolution of dispute settlement and classification,
and other customs issues.
2.2 To ensure uniformity and consistency in the application of customs rules and
regulations on dispute settlement or protest.
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2.3 To prescribe procedures on administrative remedies which are consistent with the
law and the standards set out in the Revised Kyoto Convention (RKC), the World
Trade Organization’s (WTO) Agreement on Trade Facilitation (ATF), other
international trade facilitation agreements, and international customs best practices.
Section 3. Definition of Terms. For purposes of this CAO, the following terms are defined as
follows:
3.1 Advance Ruling – shall refer to an official written and binding ruling issued by
the Bureau on customs valuation, or rules of origin, or by the Tariff Commission
on the appropriate tariff classification of goods, prior to importation or exportation,
as the case may be.
3.2 Assessment – shall refer to the process of determining the amount of duties and
taxes and other charges due on imported goods and goods for export.
3.3 Bureau – shall refer to the Bureau of Customs.
3.4 Commissioner – shall refer to the Commissioner of Customs.
3.5 Completed Assessment - shall refer to the stage of the assessment process
wherein the principal appraiser has reviewed the findings of the examiner and
makes a determination on the duties and taxes to be paid. It shall also include final
readjustment in the computation of duties and taxes and submission by the
declarant of the additional information or documentation required as accepted by
the principal appraiser to complete the declaration within the period provided in
Section 403 of the CMTA.
3.6 Customs Officer - shall refer to an employee of the Bureau whose duty, not being
clerical or manual in nature, involves the exercise of discretion in determining the
amount of duties and taxes and other changes due on imported goods or goods for
export.
3.7 Other Customs Issues - shall refer to customs issues other than those arising from
tariff classification, customs valuation and rules of origin, and other
customs-related issues already covered by a dispute settlement process under
existing laws, rules and regulations, provided that such issues affect the assessment
of duties, taxes and other charges.
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3.8 Protestable Case - shall refer to any ruling or decision by the District Collector,
except the fixing of fines in seizure cases, which is adverse to the importer,
consignee or exporter.
3.9 Release Under Tentative Assessment - shall refer to a situation wherein the
assessment is disputed and pending review, an importer or consignee may put up a
cash bond or any sufficient security equivalent to the duties, taxes and other
charges that is disputed before the importer or consignee can obtain the release of
said goods.
3.10 Rules of Origin Issue – shall refer to issues that arise when:
a. In case of imported goods, where the Bureau challenges
i. the authenticity or veracity of the Certificate of Origin (CO); or

ii. the matter of whether the imported goods are originating or not from the
alleged country of origin; or
b. In case of goods of export, the exporter does not agree with the CO issued by
the Bureau.
3.11 Security – shall refer to any form of guaranty, such as surety bond, cash bond,
standby letter of credit or irrevocable letter of credit, which ensures the satisfaction
of an obligation to the Bureau.
3.12 Tentative Assessment - shall refer to the initially assessed duties and taxes based
on tariff classification, valuation, rules of origin or other customs issues which is
disputed by the importer or consignee.
3.13 Tariff Classification Issue - shall refer to the issues that arise when the Customs Officer
raises a question on the correctness of the declared tariff classification and reclassifies the
goods, with which reclassification the importer or exporter does not agree.
3.14 Tariff Classification Dispute Ruling - shall refer to a written order on a disputed tariff
classification issued by the Tariff Commission which provides the appropriate
classification of imported goods or goods for export under the ASEAN Harmonized Tariff
Nomenclature (AHTN).
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3.15 Valuation Issue - shall refer to issues that arise when the Customs Officer challenges the
customs value declared in the goods declaration and makes his own valuation findings, to
which the importer does not agree.
Section 4. General Provisions.

4.1 Dispute Settlement may cover the following issues:
4.1.1 Tariff Classification;

4.1.2 Customs Valuation;
4.1.3 Rules of Origin;
4.1.4 Other Customs Issues; and
4.1.5 Mixed issues of tariff classification, customs valuation, rules of origin and/or
other customs issues.
4.2 All dispute settlements arising from issues on tariff classification, customs valuation or rules
of origin must not be a subject of a pending application for Advance Ruling or such
application has not been resolved as prescribed by law.
4.3 The following disputed customs issues may be released under Tentative Assessment:
4.3.1 Difficult or highly technical question of tariff classification;

4.3.2 Difficult or highly technical question relating to the application of customs
valuation rules;
4.3.3 Difficult or highly technical question relating to issues on Rules of Origin; and
4.3.4 Mixed issues involving Sections 4.3.1, 4.3.2 and 4.3.3.
4.4 The Bureau and the Tariff Commission may require the taking of samples, laboratory
analysis, detailed technical documents or expert advice prior to release of goods under
Tentative Assessment.
4.5 The Bureau shall establish an ICT-based docketing system for all dispute settlement or
protest cases arising from customs valuation, rules of origin, tariff classification, and other
customs issues to ensure proper recording, inventory, accounting, monitoring, filing, and
publication.
4.6 The Bureau may create a Technical Committee to assist and recommend in resolving
dispute settlement issues.
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4.7 Dispute settlement mechanism shall not apply when the misdeclaration, misclassification pr
undervaluation is intentional or fraudulent, such as when a false or altered document is
submitted or when false statements or information are knowingly made, in which case
Section 1400 of the CMTA shall apply. All spurious documents submitted to the Bureau
may be used as evidenced against the importer in any criminal and administrative case may
be filed as a result thereof.
In cases where the dispute settlement mechanism has commenced and fraud is discovered at
any stage, an enforcement issue is deemed to have arisen. The proceedings shall be
terminated and a Warrant of Seizure and Detention issued against the shipment.
For purposes of this CAO, an enforcement issue involves discovery of violation/s of the
CMTA which would warrant the seizure and forfeiture of the goods such as the introduction
of spurious, forged or fraudulent documents resulting to an assessment of duties and taxes
lesser than what is legally due.
When the misdeclaration, misclassification or undervaluation is intentional or fraudulent,

such as when false or altered document is submitted or when false statements or information
are knowingly made, a surcharge shall be imposed equivalent to five hundred percent
(500%) of the duty and tax due and that the goods shall be subject to seizure regardless of
the amount of the discrepancy without prejudice to the application of fines or penalties
provided under Section 1401 of the CMTA against the importer and other person or persons
who willfully participated in the fraudulent act.
4.8 The Bureau shall, in accordance with international standards, utilize ICT to enhance
customs control and to support a cost-effective and efficient customs operations geared
towards a paperless customs environment.
Section 5. Dispute Settlement Arising from Tariff Classification Issues.
5.1 Upon lodgment of goods declaration and before the Completed Assessment, as when the
goods are being subjected to documentary check or physical inspection, the Customs Officer
may raise a question against the correctness of the tariff classification as declared, and
reclassify the goods. If the importer does not agree with the reclassification, he may elevate
the matter to the principal appraiser and thereafter to the Chief, Formal Entry Division or
equivalent unit, then to the Deputy Collector for Assessment, and finally to the District
Collector.
5.2 A valid tariff classification dispute exists when the importer does not agree with the tariff
reclassification made by the District Collector.
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5.3 A tariff Classification Issue be considered difficult or highly technical when:
5.3.1 The goods are classifiable under more than one AHTN chapter, heading or
subheading.
5.3.2 The product description is not specially provided for in any AHTN heading or
subheading.
5.4 If the District Collector finds that the classification issue involves difficult or highly
technical questions that require further testing and review, the following procedures shall be
undertaken:
5.4.1 The District Collector shall accordingly inform the importer that the classification
issue involves difficult or highly technical questions;
5.4.2 In such case, the District Collector shall forward the certified true copies of
relevant documents such as goods declaration, brochures, Material Safety Data
Sheet (MSDS) for chemicals, samples and/or pictures to the Tariff Commission for
ruling;
5.4.3 The importer may request release of the goods under Tentative Assessment upon
payment of duties and taxes as declared in the goods declaration and posting of
sufficient Security to cover the disputed amount of duties, taxes and other charges
as determined by the examiner and appraiser and compliance with other pertinent
applicable rules and regulations; and
5.4.4 Upon receipt of the ruling of the Tariff Commission, the goods shall be finally
assessed unless there are other issues involved or the Bureau appeals the ruling of
the Tariff Commission to the Secretary of Finance. The District Collector shall
collect the additional duties and taxes in case the Tariff Commission resolves to
classify the subject goods with higher tariff rate; otherwise, the cash bond or the
surety bond shall be refunded or cancelled, as the case may be.
5.5 If the dispute does not involve difficult or highly technical questions on tariff
classification and the District Collector adopts the findings of the Customs Officer, the
District Collector shall notify the aggrieved importer of his ruling in writing stating his
reasons and with a directive to pay the duties and taxes in full based on the
reclassification made by the Customs Officer.
5.6 The aggrieved importer adversely affected may appeal by way of protest against such
ruling in accordance with this CAO.
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5.7 The Commissioner shall render a ruling within thirty (30) days from receipt of the
protest. If the Commissioner fails to act on the same, the ruling of the Collector shall be
deemed affirmed.
5.8 The importer who is aggrieved by the ruling of the Commissioner may submit the matter
to the Tariff Commission for a ruling within fifteen (15) days from receipt of the ruling
or file an appeal with the Court of Tax Appeals (CTA) within thirty (30) days from
receipt.
5.9 In case the ruling of the Tariff Commission is favorable to the importer, the same shall be
binding upon the Bureau unless the Secretary of Finance shall rule otherwise.
The importer aggrieved by the order of the Secretary of Finance reversing the ruling of
the Tariff Commission may, within thirty (30) days from receipt of an adverse ruling,
appeal the same to the CTA.
5.10 In case the ruling of the Tariff Commission is adverse to the importer and the same is
adopted by the Commissioner, the importer may appeal the decision to the CTA within
thirty (30) calendar days from receipt thereof.
Section 6. Dispute Settlement Arising from Customs Valuation.
6.1 Upon lodgement of goods declaration and before Assessment becomes final, the Customs
Officer may challenge the declaration made by the importer as to the dutiable value of the
goods pursuant to Section 707 of the CMTA. If the importer does not agree with the
valuation, he may elevate the matter to the principal appraiser and thereafter to the Chief,
Formal Entry Division or equivalent unit, then to the Deputy Collector for Assessment and
finally to the District Collector.
6.2 If the District Collector finds that the Valuation Issue involves difficult or highly technical
questions relating to the application of customs valuation rules, the following procedures
shall be undertaken:
6.2.1 The District Collector shall accordingly inform the importer within two (2)
days that the Valuation Issue involves difficult or highly technical questions;
6.2.2 In such case, the District Collector shall require the importer and the
Customs Officer to submit position papers to support their declaration or
findings, respectively within five (5) days from the receipt of the notice;
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6.2.3 If the nature of the goods permit, the District Collector shall require the
taking of samples subject to verification of the Customs Officer concerned to
be returned to the importer upon termination of the dispute settlement;
6.2.4 The importer may request release of the goods under Tentative Assessment
upon payment of duties and taxes as declared in the goods declaration and
posting of sufficient Security to cover the disputed amount of duties, taxes
and other charges as determined by the examiner and appraiser and
compliance with other pertinent applicable rules and regulations; and
6.2.5 The District Collector shall resolve in writing the Valuation Issue within
Fifteen (15) days from submission of the position papers.
6.3 If the dispute does not involve difficult or highly technical questions on proper application of
methods of valuation and the District Collector adopts the findings of the Customs Officer,
the District Collector shall notify within forty-eight (48) hours the aggrieved importer of his
ruling in writing stating his reasons and with a directive to pay the duties and taxes in full
based on the valuation made by the Customs Officer.
6.4 In case of a ruling adverse to the importer, the importer shall be liable to pay the additional
duties and taxes as adjudged or if the goods are released under Tentative Assessment, any
posted security shall be made to answer for the deficiency in duties and taxes resulting from
the ruling.
6.5 The aggrieved importer adversely affected may appeal by way of protest against such ruling
in accordance with this CAO.
6.6 In case the ruling of the Commissioner is adverse to the importer, he may seek
reconsideration or appeal the ruling in accordance with this CAO.
Section 7. Dispute Settlement Arising from Rules of Origin. The following procedures shall be
followed:
Officer tasked to verify the CO may question the authenticity of the document or the
accuracy of the information regarding the true origin of the product or certain parts
thereof.
7.2 If the importer does not agree with the findings, he may formally request to the District
Collector for the verification of the CO from the issuing country.
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7.3 The District Collector shall forward the CO to the Assessment and Operations
Coordinating Group (AOCG) for verification from the issuing country.
7.4 The importer may request release of the goods under Tentative Assessment upon payment
of duties and taxes as declared in the goods declaration and posting of sufficient Security
to cover the disputed amount of duties and the corresponding adjustments in taxes and
other charges, if any, as determined by the examiner and appraiser and compliance with
other pertinent applicable rules and regulations.
7.5 Upon receipt of the result of the verification from the issuing country, the Deputy
Commissioner for AOCG shall forward the same to the District Collector.
7.5.1 If the issuing country confirms the authenticity or the accuracy of the CO, the
corresponding preferential rate shall be applied. The assessment is deemed
completed and final upon readjustment based on the resolution of the case
involving rules of origin and the Security posted shall be cancelled or released.
7.5.2 If the issuing country finds that the Co was not authentic or accurate, the
District Collector shall forfeit the Security posted in case of cash bond or
require the importer to pay the applicable duties and taxes equivalent to the
amount that is disputed.
Section 8. Dispute Settlement Arising from Other Customs Issues.
Officer may challenge the declaration made by the importer pertaining to Other Customs
Issues. If the importer does not agree with the Customs Officer, he may elevate the matter
to the principal appraiser and thereafter to the Chief, Formal Entry Division or equivalent
unit, then to the Deputy Collector for Assessment and finally to the District Collector.
8.2 If the District Collector finds that the issues raised by the Customs Officer affect the
Assessment of duties, taxes and other charges, the following procedures shall be
undertaken:
8.2.1 The District Collector shall require the importer and the Customs Officer to
submit position papers to support their declaration or findings, respectively
within five (5) days from the receipt of the notice;
8.2.2 The District Collector shall resolve in writing the issues within Fifteen (15)
days from submission of the position papers; and
8.2.3 The importer may request release of the goods under Tentative Assessment
upon payment of duties and taxes as declared in the goods declaration and
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posting of sufficient Security to cover the disputed amount of duties, taxes and
other charges as determined by the examiner and appraiser and compliance with
other pertinent applicable rules and regulations. Release under Tentative
Assessment may only be allowed if the customs related issue does not involve
the integrity, authenticity, or genuineness of any document submitted in support
of the goods declaration.
8.3 If the District Collector adopts the findings of the Customs Officer, the District Collector
shall notify within forty-eight (48) hours the aggrieved importer of his ruling in writing
stating his reasons and with a directive to pay the duties and taxes in full based on the
valuation made by the Customs Officer.
8.4 The aggrieved importer adversely affected may appeal by way of protest against such
ruling in accordance with this CAO.
8.5 The Commissioner shall render a ruling within thirty (30) days from receipt of the protest.
Otherwise, the ruling of the Collector shall be deemed affirmed if the Commissioner fails
to act on the same.
8.6 In case the ruling of the Commissioner is adverse to the importer, he may seek
reconsideration or appeal the ruling in accordance with this CAO.
Section 9. Dispute Settlement Arising from Mixed Issues.
9.1 When the dispute involves mixed issues, the District Collector shall resolve the same
simultaneously in accordance with the procedure provided under the preceding
sections.
9.2 In case where one of the issues involves a question on tariff classification, the District
Collector may resolve all other issues without waiting for the resolution on tariff
classification by the Tariff Commission. However, when the tariff classification is
indispensable to the resolution of the other issues such as valuation, the District
Collector shall resolve the same only upon receipt of the tariff classification ruling.
Section 10. Protest.
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10.1 The aggrieved importer or exporter or any stakeholder directly affected by the adverse
ruling of the District Collector in all Protestable Cases arising from tariff classification,
valuation, rules of origin or other customs issues, may appeal by way of protest in
writing to the Commissioner within fifteen (15) days from receipt of the adverse ruling
of the District Collector, when payment is made as a result of the adverse ruling, within
fifteen (15) days from such payment. Otherwise, the action of the District Collector shall
be final and conclusive.
10.2 A protest filed shall specify the particular ruling of the District Collector for which
protest is being made and shall indicate the particular ground or grounds upon which the
protesting party bases the claim for relief. The scope of a protest shall be limited to the
particular goods subject of a goods declaration, but any number of issues may be raised
in a protest with reference to the goods declaration constituting the subject matter of the
protest.
10.3 When a protest is filed in proper form, the Commissioner shall render a ruling within
thirty (30) days from receipt of the protest. Otherwise, the ruling of the Collector shall
be deemed affirmed if the Commissioner fails to act on the same.
Section 11. Motion for Reconsideration. The importer aggrieved by the ruling of the Commissioner,
other than a ruling on tariff classification, may, within fifteen (15) calendar days, from receipt of the
ruling, file a Motion for Reconsideration with the Commissioner.
Section 12. Finality of the Decision. Unless an appeal is made to the CTA in the manner and within the
period herein prescribed, the ruling of the Commissioner shall be final and executory.
Section 13. Appeal. An importer aggrieved by the decision of the Commissioner may appeal the said
decision to the CTA within thirty (30) days from receipt of the adverse decision or final order of the
Commissioner.
Section 14. Transitory Provisions. All protest cases filed prior to the effectivity of this Order shall be
resolved in accordance with the applicable provisions of the Tariff and Customs Code of the Philippines
(TCCP), as amended.
Section 15. Publication of Rulings and Confidentially.
15.1 The Bureau and the Tariff Commission shall publish the summaries of rulings on its
website taking into account the need to protect commercially confidential information.
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15.2 All information which is by nature confidential or which is provided on a confidential

basis for the purposes of tariff classification, valuation, or other customs issue shall be
treated as strictly confidential by the authorities concerned who shall not disclose it
without the specific permission of the persons or government providing such
information, except to the extent that it may be requires to be disclosed in the context of
judicial proceedings.
15.3 Any information communicated in accordance with the provisions relating to the rules
of origin shall be treated as confidential and used for customs purposes only.
Section 16. Periodic Review. Unless otherwise provided, this CAO shall be reviewed every three (3)
years and be amended or revised if necessary.
Section 17. Separability Clause. If any part of this CAO is declared unconstitutional or contrary to
existing laws, the other parts not so declared shall remain in full force and effect.
Section 18. Repealing Clause. This CAO specifically repeals previously issued Orders which are
inconsistent with the provisions here stated.
Section 19. Effectivity. This CAO shall take effect thirty (30) days after its complete publication at the
Official Gazette or a newspaper of national circulation.
The Office of National Administrative Register (ONAR) of the UP Law Center shall be provided three
(3) certified copies of this CAO.
REY LEONARDO B. GUERRERO

Commissioner
APPROVED:
CARLOS G DOMINGUEZ
COMMISSION ORDER NO. 2018 – 01
SUBJECT: RULES OF PROCEDURE ON DISPUTES INVOLVING TARIFF CLASSIFICATION
This Commission Order (Order) establishes the procedure for a Dispute Ruling system on tariff
classification involving imported and exported goods pursuant to Chapter 1 of Title XI of Republic Act
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No. 10863 or the Customs Modernization and Tariff Act (CMTA), consistent with Philippine
commitments under the World Trade Organization's (WTO) Agreement on Trade Facilitation, the
ASEAN Trade in Goods Agreement (ATIGA), the World Customs Organization's (WCO) Harmonized
System Convention, the Revised Kyoto Convention, and other relevant international trade agreements.
Section 1. Scope.
This covers the administrative remedies and procedures in the final determination by the Tariff
Commission (Commission) of disputes involving tariff classification under Chapter 1, Title XI of the
CMTA.
2.1 To provide rulings on goods with disputed tariff classification endorsed by the Bureau of
Customs (BOC) or filed by the importer or exporter.
2.2 To establish a Tariff Classification Dispute Ruling system that is in line with the
Trade Facilitation, the ATIGA, the WCO Harmonized System Convention, other relevant
international trade agreements, relevant Philippine laws, and international best customs
practices.
2.3 To increase the level of stakeholders' compliance through an informed customs compliance
regime.
Section 3. Definition of Terms.
3.1 Advance Ruling on Tariff Classification - an official written decision issued by the
Commission which provides the importer or exporter with the appropriate tariff classification of
goods under the ASEAN Harmonized Tariff Nomenclature (AHTN) prior to importation or
exportation.
3.2 ASEAN Harmonized Tariff Nomenclature (AHTN) - an eight-digit commodity

nomenclature adopted by the ASEAN Member States to harmonize their tariff nomenclatures at
the eight-digit level. It adheres to the six-digit commodity classification code of the
Harmonized Commodity Description and Coding System of the WCO but adds two digits, with
corresponding commodity descriptions, that represent ASEAN subheadings.
3.3 Authorized Representative - a natural or juridical person duly authorized by an

importer/exporter in writing to process its request for a Tariff Classification Dispute Ruling.
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3.4 BOC Single Administrative Document (SAD) – form used for customs declaration or goods
declaration.
3.5 Exportation – refers to the act, documentation and process of bringing goods out of Philippine
territory.
3.6 Exporter - natural or juridical person who brings goods out of the Philippines.
3.7 Filing Fee - a non-refundable amount assessed by the Commission to be paid by the importer
or exporter or his/her Authorized Representative to cover the reasonable cost of service
rendered for the issuance of a Tariff Classification Dispute Ruling.
3.8 Goods – refer to articles, wares, merchandise and any other items which are subject to
importation or exportation.
3.9 Importation – refers to the act of bringing in goods from a foreign territory including free
zones into Philippine customs territory, whether for consumption, warehousing, or admission.
3.10 Importer - a natural or juridical person who brings in goods to the

Philippine customs territory, whether for consumption, warehousing or
admission.
3.11 Legal Research Fund Fee - refers to the additional amount of one percent (1%)
of the filing fee imposed but not lower than Ten Pesos (Php 10.00) to be collected from
applicants/petitioners as required under Presidential Decree No. 1856, s. 1982.
3.12 Parties – refer to the importer or exporter or BOC who are in dispute over
the classification of goods.
3.13 Tariff Classification - refers to the act or process of determining the

subheading in the AHTN to which goods appropriately belong in accordance with Sections
1610 and 1611 of the CMTA.
3.14 Tariff Classification Dispute - refers to a situation or case when a declared

tariff classification of goods, not subject of a pending application for advance ruling, is in
dispute because the BOC has a different classification or the tariff classification for the subject
goods is considered difficult or highly technical by the BOC.
3.15 Tariff Classification Dispute Ruling - an official written decision issued by the
Commission on the disputed tariff classification which provides the importer, exporter or the
BOC with the appropriate classification of goods under the AHTN during importation or
exportation.
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Section 4. Initiation of Tariff Classification Dispute.
A dispute on tariff classification, not subject of a pending application for advance ruling, can be initiated
through the following:
a. endorsement from BOC in the case of difficult or highly technical questions on tariff
classification, as determined by BOC; or
b. filing of case by the importer or exporter when BOC has a different tariff classification.
In either case, the importer or exporter or the BOC shall submit the following documentary requirements:
a. letter-endorsement, or ruling or assessment reflecting the tariff classification made by the BOC;
b. filled-out form prescribed by the Commission (for importer or exporter only);
c. product description, brochures, technical specifications;
d. pictures of products and/or samples, as may be appropriate;
e. e. BOC SAD; and
f. affidavit or certification under oath that the goods are not subject of a pending application for
advance ruling (for importer or exporter only).
Section 5. Fees.
Pursuant to the Commission's relevant Administrative Orders, the importer or exporter, upon filing of the
case, shall pay the following:
a. filing fee;
b. Legal Research Fund fee; and
c. other fees, as may be prescribed by the Commission Failure to pay the fees shall cause the
non-acceptance of the case.
Section 6. Evaluation of Cases Endorsed by BOC.
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6.1 Within seven (7) working days from receipt of the case, the Commission shall notify the
importer or exporter and, if it deems appropriate, require him/her to submit additional
information and/or allow on-site verification to determine the proper tariff classification of
the subject goods.
6.2 Within ten (10) working days from receipt of notice, the importer or exporter shall submit
additional information and/or allow on-site verification.
Section 7. Evaluation of Cases Filed by an Importer or Exporter.
7.1 Within seven (7) working days from receipt of the case, the Commission shall, if it deems
appropriate, require the importer or exporter to submit additional information and/or allow
on-site verification to determine the proper tariff classification of the subject goods.
7.2 Within ten (10) working days from receipt of notice, the importer or exporter shall submit
additional information and/or allow on-site verification.
7.3 Within five (5) working days from receipt of the case, or receipt of additional information, or
conduct of on-site verification, the Commission shall notify the BOC that a tariff classification
dispute is filed before it and request comments.
7.4 Within ten (10) working days from receipt of the notice and the records of the case, the BOC
may file a comment or submit any additional explanation or documents to justify its findings.
Section 8. Conduct of Hearing.
The Commission, if it deems necessary, shall conduct a hearing to clarify facts necessary to resolve the
pending dispute on tariff classification. The Commission shall accordingly notify the Parties of the time
and date of the scheduled hearing.
The hearing shall be summary and fact-finding in nature and shall be presided by a hearing officer
designated by the Commission.
Section 9. Issuance of Tariff Classification Dispute Ruling.
Within twenty (20) working days from receipt of all required information or documents or the termination
of the hearing, the Commission shall issue the appropriate ruling on the dispute furnishing the importer or
exporter, BOC, and the Secretary of Finance their respective copy thereof. Depending on the complexity
of the case, said period may be extended for another twenty (20) working days upon prior notice to the
importer/exporter and BOC.
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City Tel. No. (047) 224-2089 loc. 314
Pursuant to Paragraph 2, Section 1100 of the CMTA, tariff classification rulings of the Commission shall
be binding upon the BOC, unless the Secretary shall rule otherwise.
Section 10. Grounds for Dismissal for Cases Filed by an Importer or Exporter.
The Commission may dismiss cases in any of the following circumstances:
a. when the importer or exporter fails to provide any additional information requested within the
reasonable period required by the Commission;
b. the importer or exporter did not allow the Commission to conduct on-site verification;
c. misrepresentation; or
d. noncompliance with these Rules or any Order of the Commission.
Section 11. Motion for Reconsideration.
The importer or exporter aggrieved by the ruling of the Commission may file a motion for reconsideration
within fifteen (15) days from receipt of the ruling on the ground of mistake of fact and excusable
negligence or newly discovered evidence or information not discovered during the proceedings that if
presented may alter the result of the Dispute Ruling.
Only one (1) motion for reconsideration is allowed.
Section 12. Appeal.
Within fifteen (15) days from receipt of the Order denying the motion for reconsideration, an appeal may
be filed by the importer/exporter before the Secretary of Finance.
Section 13. Finality of the Ruling.
Unless a motion for reconsideration or an appeal is made in the manner and period prescribed herein, the
ruling of the Commission shall be final and executory.
In accordance with Section 1100 of the CMTA, rulings of the Commission on commodity classification
shall be binding upon the Bureau, unless the Secretary of Finance shall rule otherwise.
Section 14. Publication.
The Commission shall publish its rulings on its website and deposit a copy of the same in its Records
Unit.
Section 15. Confidentiality.
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The confidentiality of any and all documents and information shall be duly respected in the conduct of the
proceedings. No confidential information shall be disclosed unless otherwise ordered by competent courts
or upon waiver or consent of the rights holder thereof.
Section 16. Separability Clause.
If any part of this Order is declared unconstitutional or contrary to existing laws and government policies,
the other parts not so declared shall remain in full force and effect.
Section 17. Repealing Clause.
All previously issued Commission Orders and other rules and regulations which are inconsistent with this
Order are hereby repealed and/or modified accordingly.
Section 18. Effectivity.
This Order shall take effect fifteen (15) days after its complete publication in the Official Gazette or in a
newspaper of general circulation.
The Office of National Administrative Register of the UP Law Center shall be provided three (3) certified
copies of this Order.
MARILOU P. MENDOZA
Chairperson
ALLAN B. GEPTY
Commissioner
ERNESTO L. ALBANO
Commissioner
Note: Below is the list of customs/tariff issuances which are relevant on this module. Kind read
and determine which provision/s is/are newly promulgated, still effective, amended, revoked
and/or superseded. To access the copy you may click the link given below.
60
City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
Relevant Customs/Tariff Issuances

Customs/Tariff Description Link
Issuances
TC Order 2018-01 Procedure on Application for an https://drive.google.com/file/d/1

(Dispute Rulings) Advance Ruling on Tariff Classification A4Xx4byPWvUpVhEYPs7XFi
related to importation or exportation of usczhE10oi/view
goods
Citizen's Charter Step https://drive.google.com/file/d/1

Guide abtInTzEiT43CY2HTOXmJHi5
(Dispute Ruling) jvjSrPBd/view
CAO 02-2020 Dispute Settlement and Protest https://customs.gov.ph/wp-conte

nt/uploads/2020/03/CAO_02-20
20-Dispute_Settlement_and_Pro
test.pdf
ACTIVITY 2.1
Instruction: Do/Answer the following in yellow pad paper and
1. What is protest?
2. What is/are condition/s of release of goods under tentative assessment/s?
3. What are the issues that may be covered by customs dispute settlement?
ACTIVITY 2.2
Create flowchart for Dispute Settlement arising from the following:
4.1 Tariff Classification
4.2 Customs Valuation; and
4.3 Rules of Origin
MODULE NO. 3 ALERT ORDER
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City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
I. Introduction
This module will discuss the all topics relating to Alert Order under the relevant CMTA
provisions and IRRs.
● To be knowledgeable about the issuance of alert order and its effect in the
processing/release of goods
● To familiarize the system which handles Alert Order
● To know or familiarize the Rules for Electronic/Manual Issuance and Lifting of Alert
Orders at all Ports of Entry
● To differentiate Alert & Hold Orders
III. Topics and Key
Concepts ALERT ORDERS
SEC. 1111. Alert Orders. – Alert orders are written orders issued by customs officers as
authorized by the Commissioner on the basis of derogatory information regarding possible
noncompliance with this Act. An alert order will result in the suspension of the processing of the
goods declaration and the conduct of physical or nonintrusive inspection of the goods within
forty-eight (48) hours from issuance of the order. Within forty-eight (48) hours or, in the case of
perishable goods, within twenty-four (24) hours from inspection, the alerting officer shall
recommend the continuance of processing of goods in ease of a negative finding, or issuance of a
warrant of seizure and detention if a discrepancy between the declaration and actual goods is
found. The Bureau's information system shall immediately reflect the imposition or lifting of an
alert order.
Derogatory information shall indicate the violations and other necessary specifics thereof. For
this purpose, the following shall not be considered derogatory information:
(a) General allegations of undervaluation;
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City Tel. No. (047) 224-2089 loc. 314
(b) General allegations of misclassification without providing the appropriate tariff heading and
duty of the shipment to be alerted;
(c) General allegations of over-quantity without indicating the source of information supporting
the allegation;
(d) General allegations of misdeclaration in the entry without indicating the suspected actual
contents thereof; and
(e) General allegations of importations contrary to law without indicating the specific law or rule
to be violated.
No alert order shall be issued on account of allegations of undervaluation unless said
undervaluation is caused by the submission to customs of forged or spurious invoice or other
commercial documents.
An alert order may be issued only after lodgement of the goods declaration and prior to the
release of goods from customs custody. Under no circumstances shall, the suspension of the
processing of goods declaration be allowed except through an alert order issued by an authorized
customs officer.
The costs of the physical inspection shall be borne by the Bureau: Provided, That such cost shall
be reimbursed by the owner prior to the release of the goods if the physical inspection results in
the assessment of additional duties or taxes or the issuance of a warrant of seizure.
The Commissioner shall be notified of the recommendation by the alerting officer within
twenty-four (24) hours from the issuance of the alert order. Alert orders shall be dated and
assigned a unique reference number in series which shall be the basis for reporting to and
monitoring by the Commissioner and the Secretary of Finance.
The Bureau shall create a central clearing house for alert orders and shall submit reports
quarterly on the status thereof.
SEC. 1112. Alert Orders on Perishable Goods. – When the subject of the alert order are
perishable goods, the Bureau shall attach to the recommendation a certificate stating that the
goods are perishable.
Note: Below is the list of customs issuances which are relevant on this module. Kind read, and
determine which provision/s is/are newly promulgated, still effective, amended, revoked and/or
63
City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
superseded. To access the copy you may click the link given below.
Relevant Customs Issuances

Customs Issuances Description Link
CAO 7-2019 Pre-Lodgement Control Order and Alert https://customs.gov.ph/wp-conte
Order nt/uploads/2019/07/cao-07-2019
-Pre-Lodgement_Control_Order
_and_Alert_Order-up1.pdf
CMO 47 – 2019 Implementation of the Alert Order https://customs.gov.ph/wp-conte

Monitoring System nt/uploads/2019/09/CMO_47-2
019.pdf
CMO 41 – 2019 Supplemental Guideline to Revised https://customs.gov.ph/wp-conte

Rules for Electronic/Manual Issuance nt/uploads/2019/08/cmo-41-201
and Lifting of Alert Orders at all Ports 9-Supplemental_Guideline_to_
of Entry Revised_Rules_for_Electronic_
Manual_Issuance.pdf
CMO 6 – 2019 Amendment to Sec 3.1 (Issuance of https://customs.gov.ph/wp-conte

Alert Orders) of CMO 07-2018 on nt/uploads/2019/02/cmo-06-201
“Revised Rules for the Electronic 9_Amendment_to_Issuance_of_
Manual Issuance and Lifting of Alert Alert_Orders_of_CMO_07-201
Orders at all Ports of Entry”
8.pdf
CMO 27-2018 Action on Pending Alert Orders and https://customs.gov.ph/wp-conte

Special Stops nt/uploads/2018/12/cmo-27-201
8_Action_on_Pending_Alert_O
rders_and_Special_Stops.pdf
CMO 20-2018 Suspension of the Implementation of https://customs.gov.ph/wp-conte

CMO No. 19-2018 on the Issuance of nt/uploads/2018/11/cmo-20-201
Alert Orders 8_Suspension_of_the_Impleme
ntation_of_CMO_No_19_2018
_on_the_Issuance_of_Alert_Or
ders.pdf
CMO 07-2018 Revised Rules for the https://customs.gov.ph/wp-conte

Electronic/Manual Issuance and Lifting nt/uploads/2018/06/CMO_07-2
of Alert Orders at all Ports of Entry 018_REVISED_RULES_FOR_
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City of Olongapo
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City Tel. No. (047) 224-2089 loc. 314
THE_ELECTRONIC_MANUA
L_ISSUANCE.pdf
CMO 3 – 2018 Revocation of CMO 29-2017 and https://customs.gov.ph/wp-conte

Amendment to CMO 14-2017 on nt/uploads/2018/01/cmo-03-201
Authorization to Issue Alert Orders 8_Revocation_of_CMO29-2017
andAmendment-to-CMO-14-20
17.pdf
CMO 29 - 2017 Amendment of Customs Memorandum https://customs.gov.ph/wp-conte

Order (CMO) No. 14-2017 on nt/uploads/2017/12/CMO_29-2
Authorization to Issue Alert Orders 017_Amendment_of_Customs_
Memorandum_-Order_14_2017
_on_Authorization_to_Issue_Al
ert_Orders.pdf
CMO 20-2017 Amendments to CMO 35-2015 dd Sept. https://customs.gov.ph/wp-conte

23, 2015 entitled “Revised Rules for the nt/uploads/2017/10/cmo-20-201
Electronic/Manual Issuance and Lifting 7-Amendments-to-CMO-35-201
of Alert Orders at All Ports of Entry” 5-dd-Sept.-23-2015-entitled-Re
vised-Rules-for-the-Electronic-
Manual-Issuance-and-Lifting-of
-Alert-Orders-1.pdf
CMO 14 – 2017 Abolition of Command Center and https://customs.gov.ph/wp-conte

Authorization to Issue Alert Orders nt/uploads/2014/04/CMO_14-2
017-Abolition-of-Command-Ce
nter-and-Authorization-to-Issue-
Alert-Orders.pdf
CMO 23 – 2016 Amendment of Customs Memorandum https://customs.gov.ph/wp-conte

Order No. 35-2015 Regarding the nt/uploads/2016/10/cmo-23-201
Authority to Issue Alert Orders 6-Amendment-of-Customs-Me
morandum-Order-No.-35-2015-
Regarding-the-Authority-to-Issu
e-Alert-Orders.pdf
CMO 35 – 2015 Revised Rules for the Electronic or https://customs.gov.ph/wp-conte

Manual Issuance & Lifting of Alert nt/uploads/2016/10/oldCMO/cm
Orders at all Ports of Entry o-35-2015-Revised-Rules-for-th
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e-Electronic-or-Manual-Issuanc
e-Lifting-of-Alert-Orders-at-all-
Ports-of-Entry-up.pdf
CMO 24 – 2014 Procedures For The Issuances And https://customs.gov.ph/wp-conte

Lifting of Alert Orders For Shipments nt/uploads/2014/11/CMO-No.-2
which Arrive By Air and Are Declared 4-2014-Procedures-For-The-Iss
Through The Formal Entry Process uances-And-Lifting-of-Alert-Or
ders-For-Shipments-which-Arri
ve-By-Air-and-Are-Declared-T
hrough-The-Formal-Entry-Proc
ess.pdf
CMO 21 – 2014 Procedures For The Issuance And https://customs.gov.ph/wp-conte

Lifting of Alert Orders For Formal nt/uploads/2014/10/cmo-no.-21-
Entries Filed In The E2M System 2014-PROCEDURES-FOR-TH
E-ISSUANCE-AND-LIFTING-
OF-ALERT-ORDERS-FOR-FO
RMAL-ENTRIES-FILED-IN-T
HE-E2M-SYSTEM.pdf
ACTIVITY 3.1
1. Define Alert Order?
2. What is/are condition to impose alert order?
3. What are the effects of Alert Order?
4. Enumerate the non-derogatory information under CMTA.
ACTIVITY 3.2
1. Read all provisions of CMTA and the above listed issuances to prepare for a quiz.
MODULE NO. 4 SEIZURE AND FORFEITURE
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City of Olongapo
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City Tel. No. (047) 224-2089 loc. 314
IV. Introduction
This module will discuss the all topics relating to Seizure and Forfeiture under the
relevant CMTA provisions and IRRs.
V. Learning Objectives
● To identify the properties subject to seizure and forfeiture
● To understand the conditions in effecting seizure and forfeiture or release of seized items
● To familiarize the uniform procedure in seizure and forfeiture cases including the rules
on settlement, redemption, and other remedies
● To know persons having police authority on searches, seizure and forfeiture
VI. Topics and Key
Concepts SEIZURE AND
FORFEITURE
Sec. 1113. Property Subject to Seizure and Forfeiture. – Property that shall be subject to
seizure and forfeiture
(a) Any vehicle, vessel or aircraft, including cargo, which shall be used unlawfully in the
importation or exportation of goods or in conveying or transporting smuggled goods in
commercial quantities into or from any Philippine port or place. The mere carrying or holding on
board of smuggled goods in commercial quantities shall subject such vehicle, vessel, aircraft, or
any other craft to forfeiture: Provided, That the vehicle, vessel, aircraft or any other craft is not
used as a common carrier which has been chartered or leased for purposes of conveying or
transporting persons or \
(b) Any vessel engaging in the coastwise trade which shall have on board goods of foreign
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City Tel. No. (047) 224-2089 loc. 314
growth, produce, or manufacture in excess of the amount necessary for sea stores, without such
goods having been properly entered or legally
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City Tel. No. (047) 224-2089 loc. 314
(c) Any vessel or aircraft into which shall be transferred cargo unloaded contrary to law prior to
the arrival of the importing vessel or aircraft at the port of
(d) Any part of the cargo, stores, or supplies of a vessel or aircraft arriving from a foreign port
which is unloaded before arrival at the vessel's or aircraft's port of destination and without
authority from the customs officer; but such cargo, ship, or aircraft stores and supplies shall not
be forfeited if such unloading was due to accident, stress of weather, or other necessity and is
subsequently approved by the District
(e) Goods which are fraudulently concealed in or removed contrary to law from any public or
private warehouse, container yard, or container freight station under customs
(f) Goods, the importation or exportation of which are effected or attempted contrary to law, or
any goods of prohibited importation or exportation, and all other goods which, in the opinion of
the District Collector, have been used, are or were entered to be used as instruments in the
importation or the exportation of the former;
(g) Unmanifested goods found on any vessel or aircraft if manifest therefor is required;
(h) Sea stores or aircraft stores adjudged by the District Collector to be excessive, when the
duties and taxes assessed by the District Collector thereon are not paid or secured forthwith upon
assessment of the
(i) Any package of imported goods which is found upon examination to contain goods not
specified in the invoice or goods declaration including all other packages purportedly containing
imported goods similar to those declared in the invoice or goods declaration to be the contents of
the
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(j) Boxes, cases, trunks, envelopes, and other containers of whatever character used as receptacle
or as device to conceal goods which are subject to forfeiture under this Act or which are so
designed as to conceal the character of such
(k) Any conveyance actually used for the transport of goods subject to forfeiture under this Act,
with its equipage or trappings, and any vehicle similarly used, together with its equipment and
appurtenances. The mere conveyance of smuggled goods by such transport vehicle shall be
sufficient cause for the outright seizure and confiscation of such transport vehicle but the
forfeiture shall not be effected if it is established that the owner of the means of conveyance used
as aforesaid, is engaged as common carrier and not chartered or leased, or that the agent in
charge thereof at the time, has no knowledge of the unlawful act; and
(1) Goods sought to be imported or exported:
(1) Without going through a customs office, whether the act was consummated, frustrated, or
attempted;
(2) Found in the baggage of a person arriving from abroad and undeclared by such person;
(3) Through a false declaration or affidavit executed by the owner, importer, exporter, or
consignee concerning the importation of such, goods;
(4) On the strength of a false invoice or other document executed by the owner, importer,
exporter, or consignee concerning the importation or exportation of such goods; or
(5) Through any other practice or device contrary to law by means of which such goods entered
through a customs office to the prejudice of the government.
Sec. 1114. Properties not Subject to Forfeiture in, the Absence of Prima Facie Evidence. –
The forfeiture of the vehicle, vessel, or aircraft shall not be effected if it is established that the
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owner thereof or the agent in charge of the means of conveyance used as aforesaid has no
knowledge of or participation in the unlawful act: Provided, That a prima facie presumption shall
exist against the vehicle, vessel, or aircraft under any of the following
(a) If the conveyance has been used for smuggling before;
(b) If the owner is not in the business for which the conveyance is generally used; and
(c) If the owner is not financially in a position to own such conveyance.
Sec. 1115. Conditions Affecting Forfeiture of Goods. – The forfeiture shall be effected only
when and while the goods are in the custody or within the jurisdiction of customs officers, or in
the possession or custody of or subject to the control of the importer, exporter, original owner,
consignee, agent of another person effecting the importation, entry or exportation in question, or
in the possession or custody of or subject to the control of persons who shall receive, conceal,
buy, sell, or transport the same, or aid in any of such acts, with knowledge that the goods were
imported, or were the subject of an attempt at importation or exportation contrary to law.
Sec. 1116. Seizure or Release of Goods. – The District Collector shall issue an order of release
or a warrant of seizure within five (5) days, or two (2) days in case of perishable goods, upon the
recommendation of the alerting officer or any other customs officer. The District Collector shall
immediately make a report of such seizure or release to the Commissioner.
SBC. 1117. Warrant of Seizure or Order of Release. – The District Collector shall have the
authority to issue a warrant of seizure of the goods upon determination of the existence of
probable cause and in case of nonexistence thereof, the issuance of order of release. In case the
District Collector issued an order of release, the District Collector shall immediately transmit all
the records to the Commissioner who shall automatically review within forty-eight (48) hours, or
within twenty-four (24) hours in case of perishable goods. When no decision is made by the
Commissioner within the prescribed period, the imported goods shall be deemed released.
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The lifting of the alert order shall be issued by the District Collector only upon the affirmation of
the decision of the District Collector by the Commissioner, or after the lapse of the period of
review by the Commissioner, whichever is earlier.
Sec. 1118. Sale of Perishable Goods During Forfeiture Proceedings. – Upon motion of the
importer of the perishable goods, the goods may be sold at a public auction during the pendency
of the forfeiture proceedings. The proceeds of the auction shall be held in escrow until the final
resolution of the proceedings.
Sec. 1119. Service of Warrant of Seizure. – The District Collector shall cause the service of
warrant of seizure to the owner or importer of the goods or the authorized representative thereof.
The owner or importer shall be given an opportunity to be heard during the forfeiture
proceedings.
For the purpose of serving the warrant, the importer, consignee, or person holding the bill of
lading or airway bill shall be deemed the "owner" of the goods. For the same purpose,
"authorized representative" shall include any agent of the owner and if the owner or the agent is
unknown, any person having possession of the goods at the time of the seizure.
Service of warrant to an. unknown owner shall be effected by posting the warrant for fifteen (15)
days in a public place at the concerned district, and by electronic or printed publication.
Sec. 1120. Description, Classification and Valuation of Seized Goods. – The District
Collector shall cause the preparation of a list and particular description, classification, and
valuation of the goods seized and valuation of identical or similar goods.
Sec. 1121. Proceedings in Case of Property Belonging to Unknown Parties. – If, within
fifteen (15) days after service of warrant, no owner or agent can be found or appears before the
District Collector, the seized goods shall be forfeited ipso facto in favor of the government to be
disposed of in accordance with this Act.
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City Tel. No. (047) 224-2089 loc. 314
Sec. 1122. Seizure of Vessel or Aircraft for Delinquency of Owner or Officer. – When the
owner, agent, master, pilot in command or other responsible officer of any vessel or aircraft
becomes liable for any violation of this Act, the vessel or aircraft may be seized and be subjected
to forfeiture proceedings for the settlement of any fine or penalty for which such person is liable.
In determining whether or not to seize a vessel or aircraft, the Bureau shall take into account the
amount of fine or penalty in relation to the commercial impact that may be caused to
international trade by the seizure or detention as well as the value of the vessel or aircraft.
Sec. 1123. Burden of Proof in Forfeiture Proceedings. – In all proceedings for the forfeiture of
any vehicle, vessel, aircraft, or goods under this Act, the burden of proof shall be borne by the
claimant.
Sec. 1124. Settlement of Pending Seizure Case by Payment of Fine or Redemption of

Forfeited Goods. – Subject to the approval of the Commissioner, the District Collector may
allow the settlement by payment of fine or the redemption of forfeited goods, during the course
of the forfeiture proceeding. However, the Commissioner may accept the settlement by
redemption of any forfeiture case on appeal. No settlement by payment of fine shall be allowed
when there is fraud or when the discrepancy in duties and taxes to be paid between what is
determined and what is declared amounts to more than thirty percent (30%).
In case of settlement by payment of fine, the owner, importer, exporter, or consignee or agent
shall offer to pay a fine equivalent to thirty percent (30%) of the landed cost of the seized goods.
In case of settlement by redemption, the owner, importer, exporter, or consignee or agent shall
offer to pay the redeemed value equivalent to one hundred percent (100%) of the landed cost.
Upon payment of the fine or payment of the redeemed value, the goods shall be released and all
liabilities which may attach to the goods shall be discharged without prejudice to the filing of
administrative or criminal case.
Settlement of any seizure case by payment of the fine or redemption of forfeited goods shall not
be allowed when there is fraud, or where the importation is prohibited or the release of the goods
is contrary to law.
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City of Olongapo
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Sec. 1125. Decision in Forfeiture Cases. – In forfeiture cases, the District Collector shall issue
an order for hearing within fifteen (15) days, or five (5) days in case of perishable goods, from
issuance of the warrant. The District Collector shall render a decision within thirty (30) days
upon termination of the hearing, or within ten (10) days in case of perishable goods. The decision
shall include a declaration of forfeiture, the imposition of a fine or such other action as may be
proper.
determine which provision/s is/are newly promulgated, still effective, amended, revoked

CAO 10 - 2020 Seizure and Forfeiture Proceedings and https://customs.gov.ph/wp-conte
Appeals Process nt/uploads/2020/07/CAO-10-20
20-Seizure-and-Forfeiture.pdf
CMO 12 – 2008 Mandatory Service of Notices, Orders, https://customs.gov.ph/wp-conte

Resolutions, Decisions and other nt/uploads/2014/03/CMO-12-20
Processes in All Seizure, VCRC Cases 08.pdf
to Government Prosecutors and all
other Aggrieved Interested Parties
CMO 10 - 2006 Special Rules Prescribing the Exercise https://customs.gov.ph/wp-conte
and Conduct of Examination, Searches nt/uploads/2014/03/CMO-10-20
and Seizures 06.pdf
ACTIVITY 4.1
1. Enumerate goods which are subject to seizure and forfeiture.
2. Write an essay in Microsoft word regarding seizure and forfeiture under CMTA in 500 words.
Note:
Follow the following format.

Font = Times New Roman/12
Margin = 1 inch each side
You may write your preferred title
Justified
74
City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
MODULE NO. 5 APPEAL IN PROTEST AND FORFEITURE CASES
VII. Introduction
This module will discuss the all topics relating to appeal in protest and Forfeiture cases,
its procedure and etc. under the relevant CMTA provisions and IRRs.
VIII. Learning Objectives
● To further understand provisions on appeal in protest and forfeiture cases; and
● To differentiate and familiarize the protest and forfeiture procedures
IX. Topics and Key Concepts
● Pleadings Notices and Appearances
● Manual of Procedure for Forfeiture Cases
APPEAL IN PROTEST AND FORFEITURE CASES

Sec. 1126. Appeal to the Commissioner. – In forfeiture cases, the person aggrieved by the
decision of a District Collector may, within fifteen (15) days or five (5) days in case of
perishable goods, from receipt of the decision, file a written notice of appeal, together with the
required appeal fee to the District Collector, furnishing a copy to the Commissioner. The District
Collector shall immediately transmit all the records of the proceedings to the Commissioner,
who shall review and decide on the appeal within thirty (30) days from receipt of the records, or
fifteen (15) days in the case of perishable goods: Provided, That if within thirty (30) days, no
decision is rendered, the decision of the District Collector under appeal shall be deemed
affirmed. An appeal filed beyond the period herein prescribed shall be dismissed.
Appeals to protest cases shall be governed by Section 114 of this Act.
75
City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
The decision of the Commissioner may be served through the recognized modes of service under
existing law.
Sec. 1127. Automatic Review in Forfeiture Cases. – The Commissioner shall automatically
review any decision by the District Collector adverse to the government. The entire records of
the case shall be elevated within five (5) days from the promulgation of the decision. The
Commissioner shall decide on the automatic review within thirty (30) days, or within ten (10)
days in the case of perishable goods, from receipt of the records. When no decision is rendered
within the prescribed period or when a decision adverse to the government is rendered by the
Commissioner involving goods with FOB or FCA value of ten million pesos (P10,000,000.00) or
more, the records of the decision of the Commissioner, or of the District Collector under review,
as the case may be, shall be automatically elevated within five (5) days for review by the
Secretary of Finance. The decision issued by the Secretary of Finance, whether or not a decision
was rendered by the Commissioner within thirty (30) days, or within ten (10) days in the case of
perishable goods, from receipt of the records, shall be final upon the Bureau.
Sec. 1128. Automatic Review by the Secretary of Finance in Other Cases. – In cases not
involving protest or forfeiture, the Commissioner shall automatically review any decision by the
District Collector that is adverse to the government. The records of the case shall be elevated to
the Commissioner within five (5) days from the promulgation of the decision. The Commissioner
shall decide on the automatic review within thirty (30) days from receipt of the records, or within
ten (10) days in the case of perishable goods. When no decision is rendered within the prescribed
period or when any decision rendered by the Commissioner is adverse to the government, the
records of the ease under review shall be automatically elevated within five (5) days for the
review of the Secretary of Finance. The decision issued by the Secretary of Finance, whether or
not a decision was rendered by the Commissioner within thirty (30) days from receipt of the
records, or within ten (10) days in the case of perishable goods, shall be final upon the Bureau.
determine which provision/s is/are newly promulgated, still effective, amended, revoked

CAO 10 - 2020 Seizure and Forfeiture Proceedings and https://customs.gov.ph/wp-conte
Appeals Process nt/uploads/2020/07/CAO-10-20
20-Seizure-and-Forfeiture.pdf
76
City of Olongapo
GORDON COLLEGE
City Tel. No. (047) 224-2089 loc. 314
CMO 4A - 2018 Amendment of Manual of Procedure for

Forfeiture Cases https://customs.gov.ph/wp-conte
nt/uploads/2018/05/cmo-4-2018
-a_Amendment_of_CMO_4_20
18_Manual_of_Procedure_for_
Forfeiture_Cases-1.pdf
CMO 4 - 2018 Manual of Procedure for Forfeiture https://customs.gov.ph/wp-conte

Cases nt/uploads/2018/03/cmo-04-201
8_Manual_of_Procedure_for_F
orfeiture_Cases.pdf
CMO 8 - 2007 Addendum to CMO NO. 28-90 https://customs.gov.ph/wp-conte

Procedure in Forfeiture of Bonds nt/uploads/2014/03/CMO-8-200
7.pdf
77

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Republic of the Philippines

College of Business and Accountancy

Schedule Module Learning Teaching and

1st – 2nd MODULE 1:

5th week MODULE 3:

● To know or - Persons ● CMO 41 –

and forfeiture or ● Propert ● Google

9th – 11th MODULE 5:

12th week MODULE 6: ● CMTA,

16th week MODULE 9: ● To understand ● Disposi ● CMTA,

17th - 18th MODULE 10: ● To explore and ● Seizure ● CMTA, ● To conduct

MODULE NO. 1 ADVANCE RULING

II. Learning Objectives

● To realize the purpose of advance ruling on importation and exportation

● To determine which goods are covered for an advance ruling application

III. Topics and Key Concepts

Advance Tariff Classification Ruling

COMMISSION ORDER NO. 2017 – 01

SUBJECT: Procedure on Application for an advance ruling on Tariff Classification related to

2.3 To increase the level of stakeholders’ compliance through an informed customs

Section 3. Definition of Terms.

3.3 ASEAN Harmonized Tariff Nomenclature (AHTN) – an eight – digit commodity

3.4 Authorized Representative – a natural or juridical person duly authorized by the

3.7 Exporter – refers to any of the following:

a) Domestic exporter – a natural or juridical person intending to bring goods out of

b) Foreign exporter – a natural or juridical person in a foreign country intending to

Section 4. Administrative Provisions.

An applicant or his/her Authorized Representative may apply for an Advance Ruling.

4.2 Conditions for Application for an Advance Ruling on Tariff Classification.

4.5 Grounds for Non-Acceptance of an Application for an Advance Ruling on Tariff

a) the application is not in the prescribed application form;

c) the request pertains to multiple goods under different subheadings as ascertained by

4.6 Submission of Additional Information and On-site Verification

4.7 Grounds for Non-Issuance of Advance Ruling on Tariff Classification

b) the goods involved are subject of a pending court litigation or of an administrative

e) other similar cases

4.8 Withdrawal of Application for an Advance Ruling on Tariff Classification

4.9 Issuance of an Advance Ruling on Tariff Classification

The Advance Ruling shall be effective from the date it is issued.

5.2 Only one (1) motion for reconsideration is allowed.

Section 8. Use of information and Communications Technology.

Section 9. Construction and Interpretation.

CARLOS G. DOMINGUEZ III

Advance Ruling on Valuation and Rules of Origin

2.4 To increase the level of stakeholders’ compliance through an informed customs

Section 4. Administrative Provisions.

4.2 Requirements for Requests for Advance Ruling.

4.2.1. Period to Request Advanced Ruling for the Importation of Goods . To

4.2.2. Other Requirements.

a. A request for Advance Ruling must be made in writing to be submitted to the

4.3 Acknowledgement of Receipt; Notice to Provide Additional Information and/ or

4.5 Revalidation of Advance Ruling.

4.7 Grounds for Declining.

4.8 Binding Effect and Period of Effectivity of an Advance Ruling.

4.9 Modification, Revocation or Invalidation of an Advance Ruling.

4.9.1. Modification of Advance Rulings. Advance Rulings may be modified based

Modification of Advance Rulings is, as a general rule, of prospective

4.9.2. Revocation or Invalidation of an Advance Ruling. An Advance Ruling may

4.9.3. Notification. Where the Advance Ruling is modified, revoked or invalidated,

Section 5. Authority of the Commissioner to Issue Supplementary Rules and Regulations.

CARLOS G. DOMINGUEZ III

CUSTOMS MEMORANDUM ORDER NO. 30 – 2016