DETERMINATION OF DUTIABLE FREIGHT

AND DUTIABLE INSURANCE

(CMO 22-2007)
B Y: D E R I C K D . D E G U Z M A N , L C B
 ELEMENTS OF DUTIABLE VALUE

TOTAL CUSTOMS VALUE FOB value by sea/

FCA value by air
(Incoterms 2020)

Plus: DUTIABLE FREIGHT By sea/air

(CMO 22-2007)

Plus: DUTIABLE INSURANCE (CMO 22-2007)

Plus: DUTIABLE OTHER CHARGES Mandatory

Additions
(CMO 16-2010)

There is no such thing as failure, only delayed success 2

 A. DUTIABLE FREIGHT (SEA)

• Refers to the charges paid for the transport of the cargo from port of origin
to port of destination

a. Shall be the freight charges indicated in the B/L

b. If the freight charges appears in both the commercial invoice and B/L or
AWB, then the dutiable freight is whichever is higher between the freight per
invoice and the freight charges per B/L or AWB
Dut. FRT = FRT per CI vs. FRT per B/L, whichever is higher

There is no such thing as failure, only delayed success 3

 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
T. CFR $27,750.00
FRT/Inv $2,200.00
FRT/BL $2,250.00
Dut. INS $500.00
E/R P43.150/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 4

 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 2

GIVEN:
T. CPT $15,500.00
FRT/Inv $1,550.00
FRT/BL $1,500.00
Dut. INS $310.00
E/R P43.250/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 5

 A. DUTIABLE FREIGHT (SEA)

c. If no freight charge is indicated in the bill of lading and/or

invoice, then the declared freight charge on the IEIRD/SAD may
be considered, provided that said amount is not lower than 70%
of the Conference Rate, otherwise a Certification from the carrier
or Official Receipt as to the actual freight charges paid must be
presented to the BOC

Dut. FRT = FRT/SAD vs 70% of GCR, whichever is higher

There is no such thing as failure, only delayed success 6

 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
T. FOB $8,500.00
FRT/SAD $800.00
FRT/GCR $1,150.00
Dut. INS $170.00
E/R P43.045/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 7

 A. DUTIABLE FREIGHT (SEA)

d. In case of bulk shipments, the certified copy of Charter party document of

Freight Contract, and Stowage Plan shall be presented to show the actual
freight charges, all of which shall be attached to the working copy of the entry.
Dut. FRT = FRT per Charter Party Contract

e. For bulk/general cargo shipments made by the National Food Authority

(NFA), the actual freight charge may be accepted provided that it is not lower
than 10% of the CFR value of the commodity.
Dut. FRT = Actual FRT vs 10% CFR, whichever is higher

There is no such thing as failure, only delayed success 8

 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
Consignee NFA
Shipment Corn in bulk
T. FOB $25,000.00
FRT/BL $2,500.00
Dut. INS $1,000.00
E/R P43.185/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 9

 A. DUTIABLE FREIGHT (SEA)

f. In case of refrigerated shipments, a certification from shipping lines as to the freight

paid must be presented for Customs verification.
Dut. FRT = FRT/BL (w/ Certification from S.L.)

In the absence of a shipping lines certification, the following freight charges may
be used as reference:

*From China: 20’ 40’

Guangzhou $1,300.00 $1,700.00
Xiamen $1,500.00 $1,800.00
Shanghai $1,800.00 $3,200.00
Dalian $1,350.00 $1,680.00

There is no such thing as failure, only delayed success 10

 A. DUTIABLE FREIGHT (SEA)

*From Hong Kong:

$1,600.00 per 40’ reefer van
$800.00 per 20’ reefer van

*From Singapore:
$970.00 per 20’ reefer van
$1,990.00 per 40’ reefer van

* From Los Angeles, USA

$3,050.00 per 20’ reefer van
$6,100.00 per 40’ reefer van

Dut. FRT = FRT/BL vs Reefer Rates, whichever is higher (if no cert. from SL)

There is no such thing as failure, only delayed success 11

 A. DUTIABLE FREIGHT (AIR)

a. Shall be the freight charges indicated in the Air Waybill

b. If no freight charge is indicated in the air waybill and/or invoice, then the
declared freight charge on the IEIRD/SAD may be considered, provided
that said amount is not lower than 70% of the Conference Rate, otherwise
a Certification from the carrier or Official Receipt as to the actual freight
charges paid must be presented to the BOC
Dut. FRT = FRT/SAD vs 70% of IATA, whichever is higher

There is no such thing as failure, only delayed success 12

 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
Shipment 2x20’ STC: Frozen poultry meat
Origin Hong Kong
T. FOB $10,500.00
T. O/FRT $1,500.00 (w/o cert. from S.L.)
Dut. INS $420.00
E/R P43.065/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 13

 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 2

GIVEN:
Shipment 3x40’ STC: Frozen salmon
Origin Xiamen, China
T. FOB $22,500.00
FRT/BL $4,500.00 (w/ cert. from S.L.)
Dut. INS $900.00
E/R P43.350/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 14

 B. DUTIABLE INSURANCE

• Refers to the cost of insurance taken to cover against

risk for damage/loss while transporting goods from
origin to destination

a. If the terms of sale are CIF/CIP, the amount of the

actual insurance premium shall be used in the
assessment, PROVIDED THAT, it is indicated as a
SEPARATE VALUE

There is no such thing as failure, only delayed success 15

 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Gen. cargo
T. FOB $12,500.00
FRT/Inv $ 1,200.00
FRT/BL $ 1,250.00
INS/Inv $ 200.00
T. CIF $13,900.00
E/R P43.115/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 16

 B. DUTIABLE INSURANCE

b. If such amount is lower than 2% of the FOB value for general

cargo and 4% of the FOB value for dangerous/inflammable
goods, the same shall be subject to further verification by the
BOC
1. Gen. Cargo 2. Dangerous Cargo
a.
b. INS = 0.02 x FOB b. INS = 0.04 x FOB

There is no such thing as failure, only delayed success 17

 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Chemicals
T. CIF $18,244.00
FRT/BL $ 1,300.00
E/R P43.250/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 18

 B. DUTIABLE INSURANCE

c. If a shipment is covered by a local or domestic insurance, the

amount of insurance premium actually paid may be accepted for
assessment purposes (if equivalent or higher than 2% or 4% for
general and dangerous cargo, respectively)

*If with Cert./OR

Dut. INS

There is no such thing as failure, only delayed success 19

 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Gen. cargo
T. FOB $9,750.00
T. O/FRT $ 750.00
Loc. INS P6,491.25 (w/ Cert./O.R.)
E/R P43.275/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 20

 B. DUTIABLE INSURANCE

d. If the local insurance premium is lower than 2% of the FOB value for
general cargo to 4% of the FOB value for dangerous/inflammable goods, then
a certification from the insurance company indicating actual premium paid
shall be presented to the BOC together with the original official receipt.

*If without Cert/O.R.

a. INS1 = Loc. Prem
b. Ins2 = 2% or 4% FOB

Dut. INS = whichever is higher from a or b

There is no such thing as failure, only delayed success 21

 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment 2 units - automobiles
T. FOB $25,000.00
O/FRT $2,000.00
Loc. INS P34,760.00 (w/o Cert./O.R.)
E/R P43.450/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 22

 B. DUTIABLE INSURANCE

e. Importation not covered by any local insurance, the amount of insurance

premium declared in the Entry may be accepted, provided that if such amount
is lower than 2% and 4% of the FOB value for general and dangerous cargoes
respectively, the same shall be subject to verification by the BOC.

For General Cargoes: For Dangerous Cargoes:

Dut. INS = 2% x FOB Dut. INS = 4% x FOB

There is no such thing as failure, only delayed success 23

 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Gen. cargo
T. CFR $13,500.00
FRT/Inv $1,300.00
FRT/BL $1,350.00
“No local insurance”
E/R P43.450/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed success 24

 B. DUTIABLE INSURANCE

f. For direct importation by the government, the original copy of the Marine
Open policy issued by the GSIS together with true copy shall be presented to
the BOC certified by the latter. The Bureau shall apply the actual GSIS
insurance premium rate.

Dut. INS =

If insured by a domestic surety company other than the GSIS, apply d. and if
not covered by a local insurance , apply e.

There is no such thing as failure, only delayed success 25