2022 CBLE Review - CDP -01 - LECTURE MATERIAL 7/5/22

2022 REVIEW ON
CUSTOMS DOCUMENTATION AND LECTURE RECORDING IS NOT ALLOWED
PROCEDURES CLaP Escolta lectures are protected under R.A.
No. 4200 and other laws, rules and regulations
on recording of public communication.
DAY 01- PRINCIPLES OF FORMAL ENTRY
PROCESS AND MODES OF PAYMENT
CLaP REVIEW MATERIALS ARE PROTECTED UNDER THE INTELLECTUAL
PROPERTY LAW AND THE LAW OF KARMA. THE MATERIALS ARE
DISTRIBUTED TO THOSE ENROLLED IN THE CBLE REVIEW FOR THEIR
EXCLUSIVE USE ONLY. ENROLLEES ARE NOT ALLOWED TO REPRODUCE,
DISTRIBUTE, SHARE UNDER THE PAIN OF CRIMINAL PROSECUTION AND
THE HARSH PUNISHMENT OF KARMA OF DIFFICULTY IN PASSING THE
CBLE AND DIFFICULTY IN DEALING WITH CUSTOMS AND TARIFF
MATTERS FOR LIFE. UNAUTHORIZED RECIPIENTS ARE LIKEWISE 1 2
FOREWARNED!
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2022 CBLE Review - CDP -01 - LECTURE MATERIAL
GOODS DECLARATION FOR CONSUMPTION:
FORMAL ENTRY OR INFORMAL ENTRY PROCESS
All goods declaration for consumption shall be cleared
through a formal entry process,
: except: the following goods which shall be cleared
through an informal entry process:
(a) Goods of a commercial nature with FOB or FCA value
of less than P50,000.00.
Every 3 years after CMTA effectivity , the Secretary of
Finance shall adjust this amount as provided herein to
its present value, using the CPI as published by the
PSA; and
(b) Personal and household effects or goods, not in
commercial quantity, imported in a passenger’s
baggage or mail.
- includes also those imported through consolidation
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• The Commissioner may adjust the value of
goods of commercial nature that shall be
cleared through an informal entry process
without prejudice to the periodic 3-year
adjustment.
• All importations entered through a formal
entry process shall be covered by a letter of
credit or any verifiable commercial document
evidencing payment or
– in cases where there is no sale for export,
by any commercial document indicating
the commercial value of the goods.
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2022 CBLE Review - CDP -01 - LECTURE MATERIAL
SHIPMENTS THAT SHALL BE CLEARED THROUGH
FORMAL ENTRY PROCESS
• Shipments considered to be of commercial nature
which are those in excess of FOB or FCA value limitation
for informal entry and those for which the informal
entry process may not be used.
• Importation of motor vehicles, motorcycles and motor
scooters regardless of consignees, including those under
CMTA, Section 800 shall be under the Formal Entry
Process.
• Those falling under the remaining sub-paragraphs of
CMTA, Section 800 – Conditionally Tax and/or Duty
Exempt Importations shall fall under Formal Entry
Process provided that its FOB or FCA value as
determined by BOC is P50,000.00 and above.
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SHIPMENTS TO BE CLEARED THROUGH
INFORMAL ENTRY PROCESS
1. Goods of commercial nature with FOB or FCA value of less
than fifty thousand pesos (P50,000.00)
2. Personal and household effects or goods, not in
commercial quantity, whether or not subject to duties
and/or taxes
3. Conditionally tax and/or duty-exempt Importations under
CMTA, Section 800:
a. Importations of Returning Residents and OFWs as
embodied in CAO 6-2016;
b. Balikbayan Boxes sent to families or relatives by
Qualified Filipinos While Abroad and consolidated
shipment of duty and tax-free Balikbayan Boxes as
embodied separately in CAO 1-2018;
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2022 CBLE Review - CDP -01 - LECTURE MATERIAL
SHIPMENTS TO BE CLEARED THROUGH
INFORMAL ENTRY PROCESS
c. Shipments containing wearing apparel, goods of personal
adornment, toiletries, portable tools and instruments,
theatrical costumes and similar effects accompanying
travelers, or tourists, or arriving within a reasonable time
before or after their arrival in the Philippines, which are
necessary and appropriate for the wear and use of such
persons according to the nature of the journey, their comfort
and convenience subject to conditions as may be required by
the Department of Finance (DOF) and the Bureau of Customs
(BOC);
d. Shipments containing professional instruments and
implements, tools of trade, occupation or employment,
wearing apparel, domestic animals, and personal and
household effects belonging to persons coming to settle to
Philippines or Filipinos or their families and descendants who
are now residents or citizens of other countries, such parties
referred to as Overseas Filipinos subject to conditions as may
be required by DOF and BOC
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SHIPMENTS TO BE CLEARED THROUGH
INFORMAL ENTRY PROCESS
e. Shipments covering importations for the personal or
family use of members and attaches of foreign
embassies, legations, consular officers and other
representatives of foreign governments and for
official use subject to conditions as may be required
by the Department of Foreign Affairs (DFA), DOF and
BOC;
f. Coffins or urns containing human remains, bones or
ashes, used personal and household effects (not
merchandise) of the deceased person, except
vehicles, the FCA or FOB value of which does not
exceed one hundred fifty thousand pesos
(P150,000.00);
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SHIPMENTS TO BE CLEARED THROUGH
INFORMAL ENTRY PROCESS
g. Shipments containing personal and household
effects of any officer or employee of DFA, including
any attached, civil or military or member of the
staff assigned to a Philippine diplomatic missions
abroad by the DFA or any similar officer or
employee of other Departments assigned to any
Philippine Consular office abroad, or any AFP
military officer accorded assimilated diplomatic
rank or on duty abroad who is returning from a
regular assignment abroad, for reassignment to the
home office, or who dies, resigns, or is retired from
the service subject to conditions as may be required
by the DFA, DOB and BOC;
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SHIPMENTS TO BE CLEARED THROUGH
INFORMAL ENTRY PROCESS
4. Those falling under the remaining sub-paragraphs of CMTA,
Section 800 – Conditionally Tax and/or Duty Exempt
Importations shall fall under Informal Entry Process
provided that its FOB or FCA value as determined by BOC is
less than fifty thousand pesos (P50,000.00);
5. Clearance of previously imported diplomatic supplies and
equipment of foreign embassies and tax-exempt
institutions sold to a non-privileged buyer shall be manually
processed under the Informal Entry Division (IED)
6. Relief consignments
7. EAGA-BIMP importations
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2022 CBLE Review - CDP -01 - LECTURE MATERIAL 7/5/22

COMMON TERMS IN L/C TRANSACTION: UCP

MODES OF PAYMENT 600
1. Advising bank (Bank in PH) - the bank that advises the
1. Letter of Credit (L/C); credit at the request of the issuing bank.
2. Documents Against Payment (D/P); 2. Applicant (Importer) - the party on whose request the
3. Documents Against Acceptance (D/A); credit is issued.
4. Direct Remittance (DR); 3. Beneficiary (Exporter) - the party in whose favour a credit
5. Advance Payment; and is issued.
6. Open Account (O/A) including intercompany netting 4. Complying presentation - a presentation that is in
arrangement among non-bank related parties. accordance with the terms and conditions of the L/C
Note: Modes of payment is 5% of Tariff Law and INCOTERMS 5. Confirmation - definite undertaking of the confirming
2020 is 5% of Tariff Law. bank, in addition to that of the issuing bank, to honor or
negotiate a complying presentation. Confirming bank
means the bank that adds its confirmation to a credit
upon the issuing bank's authorization or request.
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TERMS IN L/C TRANSACTION FIRST STEP IN L/C TRANSACTION

6. Honor: (a) to pay at sight if the credit is available by sight
payment; (b) to incur a deferred payment undertaking
and pay at maturity if the credit is available by deferred
payment; © to accept a bill of exchange ("draft") drawn BUYER / SELLER
by the beneficiary and pay at maturity if the credit is PAYMENT
available by acceptance. (IMPORTER) BY L/C
7. Issuing bank - the bank that issues a credit at the request (EXPORTER)
of an applicant
8. Negotiation - the act of advancing or agreeing to advance
funds to the beneficiary
9. Nominated Bank - the bank with which the credit is
available or any bank in the case of a credit available with IMPORTER APPLICANT
any bank.
10. Presentation - either the delivery of documents under a
credit to the issuing bank or nominated bank
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ISSUING BANK

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DOCUMENTS TO BE PRESENTED BY
DOCUMENTS TO BE PRESENTED BY BENEFICIARY
BENEFICIARY

q Commercial Invoice
q Insurance Policy
Ø Indicate Admission Permit Number and PO Number Ø Applicable only on CIF or CIP shipments
Ø Indicate AHTN sub-heading (if ASEAN) or HS sub-heading (non- Ø Incoterms 2020: CIP is ICC “A” while CIF is ICC “C”
ASEAN) Ø Amount of insurance covered
q Bill of Lading or Airwaybill of Lading § If not agreed upon it is 110% of CIF or CIP value (Incoterms 2020
Ø Consigned to Order of Issuing Bank: q Packing List
q Certificate of Origin
- Notify: Importer accountee with address
q MSDS
- Indicate Invoice Number, PO Number, Admission Permit
q Other terms and conditions
Ø 3/3: Three Original and 3 copies for B/L; Original and copies for Ø Indicate latest date documents must be presented? Without such
AWB beneficiary has up to 21 days to present documents
Ø Must indicate port of loading and port of discharge Ø Latest shipment date
Ø House Bill of Lading or House Airway Bill acceptable?

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HOW BENEFICIARY INFORMED OF L/C ISSUED IN PAYMENT PROCESSES
HIS FAVOR

SENDS DOCS
CONFIRMING BANK
NEGOTIATING BANK
PRESENTED
ISSUING
ADVISING BANK COMPLYING
PRESENTATION
BANK
ISSUING REIMBURSES
BENEFICIARY
BANK
CONFIRMING
BANK

BENEFICIARY
PROCURES APPLICANT
DOCUMENTS

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BSP L/C REGULATION

PRESENTATION NOT COMPLYING
1. All L/Cs must be opened on or before the date of shipment and
only one L/C should be opened for each import transaction.
CONFIRMING BANK 2. For purposes of opening an L/C, importers shall submit to the
IN RECEIPT OF A
NON-COMPLYING
ISSUING
BANK APPLICANT AAB the documents required for regulated imports.
PRESENTATION 3. Amendments of L/Cs need not be referred to the BSP for prior
approval. L/Cs shall be negotiated in accordance with the terms
and conditions set forth in the L/C and shall be governed by the
THE REASON WHY IT IS Uniform Customs and Practices on Documentary Credits.
IMPORTANT TO REVIEW
BENEFICIARY
CAREFULLY L/C ONCE RECEIVED
(BSP Circular No. 742 dated 21 November 2011)
AND COMPLY ACCORDINGLY

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UCP 600 BASIC RULES IN L/C OPERATIONS
13. If there is no indication in the credit of the insurance
coverage required, the amount of insurance coverage
must be at least 110% of the CIF or CIP value of the
goods.
14. Partial drawings or shipments are allowed.
15. Transferable credit means a credit that specifically states
it is "transferable". A transferable credit may be made
available in whole or in part to another beneficiary
("second beneficiary") at the request of the beneficiary
("first beneficiary").
16. The fact that a credit is not stated to be transferable
shall not affect the right of the beneficiary to assign any
proceeds to which it may be or may become entitled
under the credit, in accordance with the provisions of
applicable law. This article relates only to the assignment
of proceeds and not to the assignment of the right to
perform under the credit. 21
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UCP 600 BASIC RULES IN L/C OPERATIONS
1. A credit is irrevocable even if there is no indication to that
effect.
2. A credit by its nature is a separate transaction from the
sale or other contract on which it may be based. Banks are
in no way concerned with or bound by such contract, even
if any reference whatsoever to it is included in the credit.
3. Banks deal with documents and not with goods, services or
performance to which the documents may relate.
4. A credit must state an expiry date for presentation. An
expiry date stated for honor or negotiation will be deemed
to be an expiry date for presentation.
5. If the expiry date of a credit or the last day for presentation
falls on a day when the bank to which presentation is to be
made is closed, the expiry date or the last day for
presentation will be extended to the first following banking
day.
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UCP 600 BASIC RULES IN L/C OPERATIONS
6. In relation to 5 - A bank assumes no liability or responsibility for the
consequences arising out of the interruption of its business by Acts
of God, riots, civil commotions, insurrections, wars, acts of
terrorism, or by any strikes or lockouts or any other causes beyond
its control.
7. The terms and conditions of the original credit (or a credit
incorporating previously accepted amendments) will remain in force
for the beneficiary until the beneficiary communicates its
acceptance of the amendment to the bank that advised such
amendment.
8. A nominated bank acting on its nomination, a confirming
bank, if any, and the issuing bank shall each have a
maximum of five banking days following the day of
presentation to determine if a presentation is complying.
This period is not curtailed or otherwise affected by the
occurrence on or after the date of presentation of any
expiry date or last day for presentation.
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UCP 600 BASIC RULES IN L/C OPERATIONS
9. At least one original of each document stipulated in the
credit must be presented.
10. The date of issuance of the transport document will be
deemed to be the date of dispatch, taking in charge or
shipped on board, and the date of shipment. However, if
the transport document indicates, by stamp or notation, a
date of dispatch, taking in charge or shipped on board, this
date will be deemed to be the date of shipment.
11. A transport document must not indicate that the goods are
or will be loaded on deck. A clause on a transport
document stating that the goods may be loaded on deck is
acceptable.
12. A bank will only accept a clean transport document. A
clean transport document is one bearing no clause or
notation expressly declaring a defective condition of the
goods or their packaging. The word "clean" need not
appear on a transport document, even if a credit has a
requirement for that transport document to be "clean on
board"
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OTHER MODES OF PAYMENT OTHER MODES OF PAYMENT

• Documents Against Payment (D/P) – AAB’s shall advise • Direct Remittance (DR) – Banks may service within 29
the importer of the receipt of complete original calendar days after B/L date applications for direct
documents and effect the release of said documents to remittance of import payments upon presentation of the
the importer upon receipt of payment. complete original shipping documents and import
• Documents Against Acceptance (D/A) – the original clearance in case of regulated goods.
shipping documents are released to the importer by the
AAB at the instance of the seller’s bank upon the
importer’s acceptance of the seller’s bill of exchange
obligating the importer pay for the shipment at some
future date.
• Open Account (O/A) – shipping documents are sent
directly to the buyer upon the importer’s promise to pay
at some future date. D/A or O/A must be payable at least
30 days after B/L date 26
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OTHER FOREIGN ARRANGEMENTS WHICH ARE

ALLOWED WITHOUT NEED FOR BSP PRIOR
APPROVAL
• Self-Funded/”No Dollar” Imports – These are imports
funded by importer’s own foreign currency deposit
accounts or those sent by suppliers abroad for which no
payment in foreign exchange will be made whether GENERAL PRINCIPLES OF GOODS DECLARATION AND
immediate or potential. PROCESSING THROUGH FORMAL ENTRY PROCESS
• Importations on Consignment Basis – Importations by
export producers from raw materials from foreign
suppliers abroad for the manufacture of goods for export
to the party that supplied the raw materials. Includes
equipment and spare parts consigned to the local
manufacturer for eventual re-export to the consignor. The
equipment shall only be used to manufacture products for
export.
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GOODS DECLARATION MAY BE CONSIDERED AS

SAD: GOODS DECLARATION FORM
ACTIONABLE DOCUMENTS
• Goods declaration, together with supporting • Refer to attached CMO 20—2004 on how to fill
documents shall be submitted electronically up SAD
pursuant to Republic Act No. 8792, otherwise • Note: Please pay attention to Box Numbers
known as the “Electronic Commerce Act of
2000”. and their contents.
• Such declarations when printed and certified by
a competent customs officer as a faithful
reproduction of the electronic submission shall
be considered as actionable documents for
purposes of prosecuting a declarant if the
declarations are found to be fraudulent.
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MANDATORY FILLING-UP OF SAD BOX 41

(SUPPLEMENTAL UNITS): CMO 49-2019/CMO 2-2021
SUPPORTING DOCUMENTS TO SAD
CAO 1-2020 – PENALTY OF P5,000/ CLERICAL
ERROR (INADVERTENT ERROR) • SAD Print out signed by the declarant and CB and
STANDARD UNITS OF WCO CODE EQUIVALENT e2m Code duly notarized, must be submitted to FED together
QTY with:
Carat carat CRT 1. SDV which shall be notarized;
Kilogram kg KGM 2. Endorsed BL or AWB, or in absence, a written
Liter l LTR order (DO, Telex Release or Release Order) by
Square meter m2 MTK carrier or its agent;
Cubic meter m3 MTQ 3. Commercial Invoice, L/C or any verifiable
Meter m MTR commercial documents evidencing payment; in
Number of pairs 2u NPR cases where there is no sale for export, by any
1,000 KWH 1,000 KWH MGW commercial document indicating commercial value
Piece u PCE of goods;
Pack u(jeu/pack) PCK 4. Packing list, or the commercial invoice, provided,
Thousand of pieces 1,000u TPC 31 it contains the itemized specific information. 32

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OTHER SUPPORTING DOCUMENTS TO SAD, IF PERIOD TO LODGE GOODS DECLARATION

REQUIRED BY REGULATIONS EXTENSION TO LODGE
a. Import permit for imported goods listed in the official • Period to lodge goods declaration is 15 days
list of regulated goods as posted in BOC website; • Upon written request may be extended for another 15
days subject to approval of District Collector as may be
b. Sanitary and Phytosanitary Import Clearance; authorized by the Commissioner.
c. BIR Authority to Release Goods (ATRIG); • Request must be made before the expiration of original
period and based on following:
d. CO for various FTAs or other proof of origin such as 1. Fraud committed against importer;
Invoice Declaration by Certified Exporter under the 2. Accident
Self Certification System 3. Mistake
e. Advance Ruling 4. Excusable negligence
f. LPS or DPS for bulk or break-bulk cargoes; 5. Technical issues as certified by MISTG;
6. Other analogous circumstances.
g. TEI, if applicable; and
h. Other documents as may be required.
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PERIOD TO ACT ON REQUEST FOR EXTENSION
AND COUNT OF EXTENSION PERIOD
• Request for extension shall be acted upon within 7
days otherwise the request is deemed approved.
The 15-day extension period to lodge shall retroact
to the day immediately after expiration of the
original period. No further extension is allowed.
• The right to request for extension is without
prejudice to the option to lodge provisional goods
declaration.
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LODGMENT OF GOODS DECLARATION AND
CLEARANCE ALLOWED PRIOR TO ARRIVAL
• Express shipments;
• importers enrolled in SGL, AEO and Bulk and
Break-bulk Cargo Clearance and
Enhancement Program
Note: in actual practice as long as the carrying
vessel/aircraft has submitted the IFM and
registry number is secured goods declaration
may be lodged even before arrival fo vessel.
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PROVISIONAL GOODS DECLARATION MAY
BE ALLOWED TO FACILITATE TRADE AND
PREVENT ABANDONMENT.
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WHEN ALLOWED
1. When no import permit has been presented at the
time of lodgment, provided that the importer has
timely filed the application for such permit pursuant
to the rules of the concerned agency;
2. In case of relief consignment;
3. When TEI has not been issued, provided an
application has already been filed at the time of
lodgment;
4. Any other situation where the declarant lacks
certain information or document to make a
complete goods declaration provided that it is not
due to the declarant’s negligence or fault.
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LODGMENT ALLOWED IF FOLLOWING DOCUMENTS

ARE PRESENTED
EFFECTS OF PROVISIONAL GOODS
1. Pro-forma invoice; DECLARATION
2. Duly indorsed BL/AWB, or a written order by the carrier
or its agent; 1. Tax treatment shall be the same from that of
3. Advanced copies of CO, if applicable; goods with complete declaration;
4. Duly notarized undertaking by declarant that supporting
documents to make complete declaration shall be 2. Tentative assessment shall be completed
submitted within 45 days and may be extended for
another 45 days upon approval of the District Collector. upon final submission of lacking documents;
Request for extension shall be acted upon within 7
working days, otherwise the request is deemed
approved. The 45-day extension shall start to the day
immediately after the expiration of the original period.
Reason for extension shall be the same as that for filing
provisional goods declaration.
5. Other documents as may be found necessary by BOC.

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RULE IN THE CONDITIONAL RELEASE OF GOODS
UNDER PROVISIONAL GOODS DECLARATION
FOR REGULATED GOODS
• Will not be permitted unless the regulatory
agency allows such release subject to: (a)
delivery of the goods to importer’s premises for
storage and shall not be disposed until permit is
issued and submitted to BOC within the
prescribed period; and (b) sufficient security
shall be required to cover duties and taxes and
other charges except if importer is SGL, SGL plus
or AEO or any undertaking may be required in
lieu of a security.
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RULES ON THE CONDITIONAL RELEASE OF
OTHER GOODS
1. Sufficient security to cover amount of duties
and taxes that shall be collected when the
lacking information or document is not
submitted within the prescribed period.
2. In case of highly compliant importers like SGL,
SGL plus, AEO or when the ground for
provisional goods declaration does not affect
the final computation of duties and taxes, no
security shall be required for the conditional
release of the goods.
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EFFECTS OF NON-COMPLIANCE WITH THE

CONDITIONS FOR THE RELEASE OF GOODS UNDER
PROVISIONAL GOODS DECLARATION
1. In case of regulated goods and declarant fails to
submit the required permit within the
prescribed period, the goods shall be subject to
seizure with due notice AMENDMENT AND CANCELLATION OF
2. In case of release due to lack of documents to GOODS DECLARATION UNDER CMTA AND
assess the correct D&T, any security posted or CURRENT REGULATIONS ON THE MATTER
undertaking submitted shall be subject to
forfeiture but upon due notice and without
prejudice to any other legal remedy to recover
the proper D&T

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WHEN A GOODS DECLARATION MAY BE
AMENDED AND WHEN ALLOWED
• A goods declaration may be amended provided
that the request to amend the goods
declaration, together with the intended
amendments, must be received prior to the final
assessment or examination of goods.
• Amendment of the goods declaration may be
allowed based on following grounds:
– Inadvertent error;
– Amendment of e-IFM; or
– Mistakes or omissions in good faith in the lodgment
of the goods declaration without any fraudulent
intent. 45
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POST MODIFICATION OF SAD (PMS)
1. PMS is process used when it necessary to revise the
data in the SAD. It includes the POST ASSESSMENT the
stage where the shipment is already assessed but not
yet released from Customs (i.e. Green Lane entries)
while POST ENTRY is done at the stage where the
shipment has already been released from customs (i.e.
Tentatively-Released Entries).
2. Any additional duties and taxes calculated as a result of
post assessment shall be settled at the In-House Bank
using the Cash Payment Module in the e2m Customs
System
3. The e2m Customs System shall send a release
instructions to the port operator/arrastre/CY-CFS only
once upon payment of the assessed duties & taxes due
on the import declarations.
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POST MODIFICATION OF SAD (PMS)
7. All the data in the SAD can be modified except the
following:
a. Customs Office Code (Box at me Top right hand corner
b. Model of Declaration/General Procedure Code (Box 1)
c. Importers Reference Number/T IN No. (Box 8)
d. Declarant’s Reference Number/T IN No. (Box 14)
e. Registry/Manifest Number (Box 18)
f. Bill of Lading Number (Box 40a)
g. Type of Package (Box 31)
h. Type of Packages (Box 31 & Box 6)
i. Gross Weight (Box 35) A
j. Container Reference Numbers (Box 31)
k. Warehouse (Box 49)
l. All entries or data in the Attached Documents Page
m. All entries or data in the Payment (TOP) Page 47
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POST MODIFICATION OF SAD (PMS)
8. What cannot be modified can only be changed
through SAD cancellation upon proper request
9. In case of short shipment SAD cancellation is not
required as number of packages and/or gross weight
may be modified using the Inspection Act
10. PMS for correction of Data Encoded by the Declarant
(Importer/Customs Broker) in the e2m Customs
Letter Request from the Declarant addressed to the
District Collector identifying the data in the SAD that
needs to be corrected stating the reasons and basis
for correction
11. PMS by reason of Tentative Release copy of VCRC or
CVCRRC Resolution, as the case maybe and prepared
Discrepancy Report (D/R) are required
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SAD CANCELLATION
1. Requests for SAD cancellation shall be forwarded to Office
of Dep. Com., AOCG for approval. (CMO 27-2017)
2. SC is a process used when it is necessary to revise data in
assessed SAD which cannot be done under PMS.
3. Electronic re-lodgment of new SAD to replace the
cancelled SAD is necessary in order to clear the
goods/shipment from Customs.
4. Cancellation of the SAD will revert back the status of the
attached documents like license, clearance or permit, the
Tax Exception Certificate and the Tax Debit Memo.
However, if the SAD has already undergone final
assessment by the COO V and the other settlements
modes (OSM) has been completed; payments debited
from the importers account cannot be automatically
refunded. The importer shall follow the regular refund
process.
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SAD CANCELLATION
5. The e2m SAD cancellation form shall be used.
6. Documents Required for the cancellation of SAD under
corresponding instances:
6.1. For the Change of the Consignee
• Letter Request addressed to the District Collector
stating the reason for the change and duly
approved of district Collector
• Affidavit of disclaimer of ownership
6.2. Change of Customs Broker
• Letter Request addressed to the District Collector
stating the reason for the change and duly
approved of the District Collector
6.3. Other non-modifiable date
• Letter Request addressed to the District Collector
identifying the data in the SAD that needs
correction 50
50
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SC REQUESTS ON THE GROUND OF e2M EXCEPTIONAL

ERRORS OR OTHER MISTG RELATED ERRORS: APPROVAL
OF DEP.COM, AOCG NOT REQUIRED (CMO 27-2017)

1. District Collector must ensure that a

Certification from the proper office from
MISTG is acquired before SC is effected. EXAMINATION
2. All certifications issued by MISTG personnel
shall be strictly monitored by the Technical
Support Division, Technology Management
Service, MISTG. Such reports shall be
forwarded to the AOCG for monitoring and
review.
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Selectivity Module: A risk management tool
RMO – office responsible
• Green – (low risk) the declaration is
allowed to move to the next process
• Yellow – (medium risk) the declaration is
subject t document check
• Red – (high risk) the declaration is subject
to document check and physical
examination of the gods
• Orange – (Medium to high risk) non-
intrusive examination
• Blue – the declaration is tagged for post-
clearance (CMO 19-2007)
– SGL not routed to Blue anymore
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7/5/22
EXAMINATION OF GOODS
• Examination of goods, when required by the
Bureau, shall be conducted immediately after
the goods declaration has been lodged.
Priority in the examination shall be given to
live animals, perishable goods and other
goods requiring immediate examination.
• Whenever necessary, a system of
coordination and joint examination of goods
shall be established by the Bureau and other
regulatory agencies under existing laws and
regulations.
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DUTIES OF CUSTOMS OFFICER TASKED TO
EXAMINE GOODS
1. Determine whether the packages for examination
and their contents are in accordance with the goods
declaration, invoice and other submitted
documents;
2. Take samples for examination or laboratory analysis,
when necessary;
3. Acknowledge and sign receipt for any sample taken
and retained during examination; and
4. Report whether the goods have been correctly
declared as to value, quantity, measurement,
weight, tariff classification, and not imported
contrary to law.
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TYPES OF EXAMINATION
1. Documentary check or verification of
completeness and authenticity of documents
including submission of the required import
permits, if any;
2. Non-intrusive inspection or the inspection by
use of x-ray scanners;
3. Physical examination of the goods to ascertain
that the actual nature, origin, condition,
quantity, value and tariff classification are in
accordance with the declaration in the goods
declaration.
56
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PHYSICAL EXAMINATION IN THE ABSENCE OF
DECLARANT
As a general rule, the Bureau may examine the goods in
the presence of the declarant or an authorized
representative but may be done even in the absence of the
declarant when:
1. Despite due notice, declarant fails to be physically
present;
2. Unknown or fictitious consignee; or
3. Conduct of controlled delivery, subject to the approval
of the Commissioner.
Conduct of examination shall be under the authority of the
Collector. OCOM and other concerned offices shall be
informed of the date, time and place of examination to
witness said examination. It shall be ensured that the
examination is captured on video for documentation and
record-keeping purposes.
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INSTANCES WHEN EXAMINATION MAY BE
DONE IN CONSIGNEE’S PREMISES OR
WAREHOUSE
• Physical examination of an alerted shipment shall be
conducted at consignee’s warehouse or premises in
cases when the importation is consigned to an
importer enrolled in any of the trade facilitation
program.
• In case where BOC does not have the necessary
facility to conduct the examination without causing
damage to the shipment.
• Examination of bulk and break-bulk shipment shall be
examined pursuant to the rules on the Bulk and
Break-bulk Cargo Clearance Enhancement Program
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MANDATORY USE OF BODY-WORN CAMERAS
GEOTAGGING OF PHOTOS AND VIDEOS
• The use of a body camera, recording of events and
geotagging shall be mandatory:
– Non-intrusive examination of goods
– Physical examination of goods within and/or outside of
customs zone.
• Body-worn camera – electronic camera system for creating,
generating, sending, receiving, storing, displaying and
processing audio visual recordings
• Geotagging – process of adding geographical info to various
media in the form of metadata which usually consists of
coordinates like latitude and longtitude, but may even
include bearing, altitude, distance and place names.
• Alternative recording device – an electronic camera system
that may be used as alternative for body-worn cameras. 59
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SAMPLES
• The Bureau shall take samples of the goods only
when needed to establish the tariff description
and value of goods declared, or to ensure
compliance with this Act. Samples drawn shall
be as minimal as possible.
• Customs officers shall see to it that
representative samples taken during
examination shall be properly receipted for and
retained within a reasonable period of time. The
quantity and value of the samples taken shall be
noted in the specified box of goods declaration
or electronic form. Such samples shall be duly
labeled as will definitely identify them with the
importation for which they are taken.
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NON-INTRUSIVE EXAMINATION
• Pursuant to internationally accepted standards, the
Bureau may adopt non-intrusive examination of goods,
such as the use of x-ray machines.
– CSF rates fixed under EO 635 s. 2007
• Subject to adjustment by the NEDA Board
– Mandatory whether containers subjected to x-ray or
not
– Mandatory whether Alert Order proves to be negative
or positive
• X-ray examination mandatory to all containerized cargoes
bound to CBW (Comm. Memo dated 14 Sept. 2017)
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7/5/22
SHIPMENTS TAGGED RED SUBJECT TO X-RAY
EXAMINATION
• All shipments tagged RED are required to undergo X-Ray
Examination and only those with suspicious images shall
be physically examined. (Comm. Memo 26 Sept. 2017)
• For purposes of X-Ray Examination import Entries
regardless of number containers shall be entitled to the
square root rule rounded off to the nearest higher whole
value e.g.: For 4 containers, 2 shall be subject to e-ray
examination; for 6 containers, 3 and for 9 containers 3
– Containers that shall be selected for x-ray examination
shall be selected by the Commissioner or his duly
authorized representative (Comm. Memo 27 October
2017)
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GROUNDS FOR THE CONDUCT OF PHYSICAL
EXAMINATION
1. it is directed by the Commissioner on account of a
derogatory information, in which case the
shipment is considered alerted or subject to pre-
lodgment control;
2. the goods are subject to an Alert Order issued by
competent authority;
3. the goods are electronically selected for physical
examination;
4. there are issues and controversies surrounding the
goods declaration and the import clearance
process; or
5. the importer or declarant requests for the
examination of the goods.
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7/5/22
INSTANCES WHEN IMPORTER MAY REQUEST
FOR EXAMINATION
1. Prior to lodgment of goods declaration, upon
justifiable grounds, as may be determined by the
Commissioner; or
2. After lodgment of goods declaration, when there are
issues and controversies surrounding the goods
declaration and import clearance process, unless the
shipment is selected Red or is subject to Alert Order.
The request shall be made in good faith and the
expenses shall be for the account of importer. In case
the request is made to cover up any CMTA violation or
violation of regulations, the importer shall be subject to
penalties or forfeiture of goods.
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64
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ASSESSMENT OF DUTY ON LESS THAN ENTERED

VALUE
• Duty shall not be assessed in any case upon an amount less
than the entered value,
ASSESSMENT: DETERMINATION OF – unless by direction of the Commissioner in cases when
the importer certifies at the time of entry that the
DUTIES AND TAXES – CLASSIFICATION, entered value is higher than the dutiable value and that
VALUE, ROO, INTERNAL REVENUE TAXES, the goods are so entered in order to meet increases made
by the appraiser in similar cases then pending re-
SPECIAL DUTIES appraisement; and
– the lower assessment shall be allowed only when the
importer's contention is sustained by a final decision,
and shall appear that such action of the importer was
taken in good faith after due diligence and inquiry.

65 66

65 66

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TENTATIVE ASSESSMENT
• Assessment is based on a provisional goods.
– Assessment shall be completed upon final
readjustment and submission of the additional
document or information required to complete the
goods declaration.
• The D&T initially assessed are subject to valid
dispute on valuation, classification, ROO or
protest of the same, and other customs issues.
– Assessment shall be completed upon final
readjustment based on the resolution of disputed
issues.
67
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7/5/22
COMPLETED ASSESSMENT
• BOC shall issue Final Assessment Notice
(FAN) signifying that the assessment is
complete. FAN serves as payment
instructions to AAB to debit the amount of
D&T from importer’s account. Assessment
shall be deemed final 15 days after receipt of
notice of the FAN.
– can be disputed within 15 days from FAN receipt
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MODES OF PAYMENT
1. Cash payment through debit from importer’s nominated
account in an AAB
1. Nominated account is recognized in the SAD as the Bank
Reference Number (BRN) which may only be secured if
importer has Customs Client Number (CCN). Importer
may secure as many as BRNs as it wishes. Payment
system in the e2m is called PASS5.
PAYMENT OF DUTIES AND TAXES 2. Fines, surcharges and other charges must be paid in
cash unless allowed under the PASS5. IPF, CSF must be
paid in cash.
3. L/C requiring deposit in full of D&T no longer required
2. Non-cash payment:
1. Tax Debit Memo issued by BOC. AABs shall not accept
TCCs as payment of D&T.
69 2. Deferred Payment Government Account (DPGA) 70

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GOVERNMENT IMPORTATIONS
1) Government Agencies which are eligible for the deferred
payment scheme must be registered in the CPRS with their
Joint Order (JO) 2-91 identification number. Their eligibility
shall be verified in the course of approval of their CPRS
Registration.
2) The government agency shall secure a clearance from the
Collection Service before lodgment their declaration.
3) Declaration of these pre-registered government agencies
shall avail of the deferred payment scheme by entering
the code “DPG in Part 2 of Box 37 - PROCEDURE of the
SAD. e2m Customs System checks that the government
agency is eligible for the deferred payment scheme by
verifying its eligibility in CPRS.
4) These importations shall be selected YELLOW to allow the
examiner of the Assessment Division to verify the
supporting documents of the government agency,
including the clearance issued by the Collection Service.
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7/5/22
ALTERNATIVE TO PASS5: PREPAYMENT
• Any accredited importer is given the option to open
prepayment accounts from which payments of D&T and
other charges may be made as an alternative to PASS5
required to be used by all e2m users
• Importers may open and maintain one or more prepayment
accounts with any Collection District from which will specify
where payment should be made on a per-transaction basis
• Prepayment account can be used to make payments in any
Collection District regardless of where it was opened
– example: Opened in POM but can be used to pay for duties and
taxes on MICP shipments
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WHEN DUTIES AND TAXES SHOULD BE PAID: CONFLICTING

CAOs
• If no payment confirmation is received within 15 days from the
date of receipt of AAB of payment instructions, then the
importer shall be deemed to have failed to claim his
importation after lodging the goods declaration rendering the
same liable for abandonment. (CAO 9-2020, Sec. 8.5 citing CAO
10-2008 – PASS5)
• The shipment shall be deemed abandoned if the importer fails RELEASE OF GOODS
to pay in full the assessed D&T, fees, interests and OC within 15
days from final assessment. (CAO 17-2019, Sec. 4.2.2 citing
CMTA, Sec. 1129(c)
– Having filed such goods declaration, the owner, importer,
consignee or interested party after due notice, fails to pay
the assessed duties, taxes and other charges thereon, or, if
the regulated goods failed to comply with Section 117 of
this Act, within fifteen (15) days from the date of final
73 74
assessment
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MANUAL PROCESSING/RELEASE
ONLINE RELEASE SYSTEM (OLRS)
1) Dep. Com., MISTG shall issue authorization for manual
release for following:
• Goods shall be released after receipt of a) Computer systems break-down;
payment confirmation by the customs b) Power failure; or
automated system or posting of sufficient c) Payment system of PCH/AAB off-line
2) District Collector shall issue authorization for manual
security in case of tentative release by reason release for following:
of tentative assessment including any fine or a) declared location is incorrect but arrastre confirmed
ownership even goods not in their facility
surcharge, if applicable. Release shall be b) declared location is correct but arrastre denied
through electronic instructions to the ownership and misrouted the goods;
terminal facility, off-dock CY-CFS through the c) release message not created/transmitted even if the
importation already tagged paid with print out of
OLRS of the e2m. SSDT
3) Other those above, prior authorization shall be issued
75
by the OCOM (CMO 10-2014) 76

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RELEASE OF GOODS WITHOUT PRODUCTION
OF BL OR AWB
• No customs officer shall release goods to any
person without the submission of the bill of
lading or airway bill covering the goods, except
on written order of the carrier or agent of the
vessel or aircraft, in which case neither the
government nor the customs officer shall be
held liable for any damage arising from wrongful
release of the goods: Provided, That when the
release of goods is made against such written
order, the customs officer shall require the
submission of a copy of the bill. (CMTA, Sec.
433)
77
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7/5/22
RELEASE OF GOODS UPON ORDER OF
IMPORTER
• An importer may issue a written
authorization for the release of goods stored
in a bonded warehouse to another person.
Such authorization shall not relieve the
importer from liability for the duties, taxes
and other charges due on the goods unless
the person to whom the release was
authorized assumes such liability. (Sec. 434)
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WITHOLDING RELEASE OF GOODS PENDING

NON-LIABILITY FOR MISDELIVERY OF GOODS
SATISFACTION OF LIEN
• When the District Collector is duly notified • Any customs officer who releases goods to
through a lawful order of a competent court of a the consignee or lawful holder of the bill of
lien for freight, lighterage or general average lading or airway bill shall not be liable for any
upon any imported goods, the District Collector
shall withhold the release of the goods unless defect or irregularity in its negotiation unless
the claim has been paid or secured. In case of the customs officer has notice of the defect
disagreement, the District Collector may release or irregularity.
the goods after payment of the freight and
lighterage due on the quantity or weight landed
as actually determined. (Sec. 435)

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POST RELEASE READJUSTMENT OF APPRAISAL AND
CLASSIFICATION
Returns made by the customs officers that are finally passed
upon and approved or modified by the Collector or
Commissioner, shall not be altered except:
(1) Within one year after payment of the duties, upon
statement of error as approved by the District Collector;
(2) Within 15 days after such payment, upon request for
reappraisal or reclassification addressed to the Commissioner
by the District Collector, if the appraisal or classification is
deemed to be low;
(3) Upon request for reappraisal and/or reclassification, in the
form of a timely protest addressed to the District Collector by
the interested party if the latter should be dissatisfied with the
appraisal or return; or
(d) Upon demand by the Commissioner after the completion of
81
compliance audit.
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ADJUSTMENT OF ASSESSMENT THROUGH
LIQUIDATION OF GOODS DECLARATION
• Liquidation
– the activity done by the Liquidation and Billing Division (LBD) of the port
from the receipt of the hard copy of the Goods Declaration or access to
the e2m for review and if applicable, subsequent adjustments in the
computation of D&T, sending the Notice of Discrepancy, updating the
Post Modification of SAD (PMS) the status of the Goods Declaration, and
issuance of Clearance Certificate by the LBD
• Liquidation and Billing System (LBS)
– web based portal that allows LBS users to audit and evaluation post
entry transactions to determine if there are revenues that still need to
be collected. The system will allow LBD to automatically send notices
and Final Demand Letters, as needed.
• Notice of Discrepancy
– an initiatory letter issued by the LBD and addressed to the importer
with a demand to pay deficiencies in D&T arising from Post Release
Adjustments (PRA)
– In some ports, this is also known as Final Demand Letter
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GENERAL PROVISIONS ON LIQUIDATION OF GENERAL PROVISIONS ON LIQUIDATION OF

GOODS DECLARATION
1. Upon retrieval of the ticket in the Customer Care Portal
System (CCPS), the EDP shall change the issue summary to
indicate the Goods Declaration Number for easy
identification before assigning the ticket to the COO III.
2. After final assessment, COO V instead of closing the ticket,
shall transfer the same to LBD.
3. Following must be the pre-requisites for the PMS for GD for
consumption to be effected:
a. GD was lodged, processed and final assessed in e2m;
b. Assessed D&T were paid and the goods were released from BOC.
c. The Initiatory Notice of Discrepancy from the LBD is made within 15
days from payment of D&T after review and readjustment of the
assessed D&T
83
GOODS DECLARATION
d. Amount of deficiency in the D&T must be the amount
reflected in the Notice of Deficiency or Final Demand
Letter; and
e. Importer has agreed to settle the amount due based
on reconciliation of records and other documents with
the LBD
4. Following are exempt from LBD review within 15 days from
payment of D&T
a. Shipments subject of protest and dispute settlement
resolution;
b. Adjustments arising from statement of errors; or
c. GD subject of audit by PCAG
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LIQUIDATION PROCESS
1. Upon payment of D&T, the information contained in the
GD shall be automatically extracted by the LBS the
following day.
2. If the hard copy of the GD is already received by the LBD,
the LBD Clerk shall access the LBS weblink by logging in.
3. At the start of the working hour of the day, the Chief, LBD
shall access the LBS and assign the GDs to the COO III or
COO V as assessors to conduct post validation, review of
the correctness of value, classification, and computation of
D&T by ticking “Assign” button in the Action column.
4. The Chief, LBD shall distribute equally the GDs among
assessors. Each assessor shall liquidate at least 20 GDs per
day.
85
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7/5/22
LIQUIDATION PROCESS
5. The assignment of GD may be delegated by Chief, LBD to
responsible officer of the Division.
6. Assessor shall access the LBS to view the breakdown
computation of the Assessment Division.
6.1. If assessor did not find any discrepancy, shall click Same
Value button then click Submit to send the information to Chief,
LBD
6.2. If there are discrepancy findings, the assessor can input the
correct values like customs value, freight, insurance, exchange
rate, etc.
6.3. Once the findings are submitted, the status of the liquidation
process shall be reflected as “For Review/Revision”
7. Once the status of the GD is displayed, Chief, LBD shall check
computation and findings by the assessor. If there are changes
needed the Chief can either revise or assign back to the assessor
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LIQUIDATION PROCESS
8. If there is no discrepancy upon review of the GD the Chief,
LBD shall tag the GD as “Accepted”
9. If the computation for additional D&T are fully
ascertained, the Chief shall create a templated Notice of
Discrepancy. Notice of Discrepancy form can be digitally
signed by the Chief before service to the consignee.
Initiatory Notice of Discrepancy issued by the LBD shall be
sent through the registered emails or through registered
mails or personal service.
10. If the consignee did not answer after 15 days from receipt
of the Notice of Discrepancy, the Chief shall download a
templated Final Demand Letter which shall contain
summary of fees to be paid and expected consequence if
the demand remains unheeded. It shall be signed by the
District Collector or by the Chief, LBD as authorized
signatory.
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7/5/22
LIQUIDATION PROCESS
11. If the consignee still refuses to answer the Final Demand
Letter, the Chief shall tag the GD as “Delinquent”
12. Importer shall answer the Notice of Discrepancy or Final
Demand Letter by opening a ticket in the CCPS.
13. Upon receipt of the ticket, COO IV assigned shall
acknowledge receipt thereof and request importer to
submit additional documents to support declaration, or in
case of PMS, the COO IV shall inform the importer that
PMS shall be made of the GD subject of the Notice of
Discrepancy/Final Demand Letter.
14. If the reviewing officer finds that the justification is
without merit, the importer shall be notified the amount
stated in the Notice of Discrepancy/Final Demand Letter
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LIQUIDATION PROCESS
15. If the importer still refuses to pay, the Chief shall tag the
status of GD as “Delinquent” and shall recommend to the
District Collector further action to collect.
16. If the consignee settles, the Chief, shall tag the GD as
“Paid”
17. If the consignee was able to justify accuracy of GD, the
Chief shall tag the Notice of Discrepancy/Final Demand
Letter as “Cancelled”
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7/5/22
PERIOD OF LIMITATION
• In the absence of fraud and when the goods
have been finally assessed and released, the
assessment shall be conclusive upon all parties
• three (3) years from the date of final
payment of duties and taxes, or upon
completion of the post clearance audit.
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90
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