Customs Bonded Warehouses Overview

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Questions and Answers

What does unauthorized repacking refer to?

Withdrawal of goods stored in a CBW with permission.

Proper packaging of imported raw materials.

Removing usable parts from imported articles.

Fraudulent alteration or concealment of merchandise. (correct)

What is a surety bond considered in the context of security?

A loan taken against goods stored in the warehouse.

A temporary permit for exporting goods.

A guarantee ensuring the satisfaction of an obligation. (correct)

A type of insurance policy for imported goods.

What defines semi-finished products?

Fully completed goods ready for export.

Products that are ready for distribution without further process.

Raw materials unchanged from their imported state.

Materials that have undergone processing but are not yet finished. (correct)

Who is referred to as a subcontractor in this context?

A person or company accredited to work under the Bureau and GTIDO. Signup and view all the answers

What is meant by unauthorized withdrawal?

Withdrawal of materials without due processed withdrawal slip. Signup and view all the answers

What does the Wastage Valuation Data Base (WVDB) provide?

Reference values for assessing taxes and duties on by-products. Signup and view all the answers

Which of the following best describes a Customs Common Bonded Warehouse (CCBW)?

A warehouse established jointly with GTIDO for garment importation. Signup and view all the answers

What constitutes allowable residue/wastage?

Remnants of imported articles that can't be manufactured for export. Signup and view all the answers

What does the term 'Member' refer to in the context of the economic zones?

Any entity approved to operate within established economic zones Signup and view all the answers

Which of the following functions does the Garments and Textile Industry Development Office (GTIDO) perform?

Providing assistance to the garments and textile industry Signup and view all the answers

What is the purpose of the Formula of Manufacture (FOM)?

To determine raw material usage and wastage for exports Signup and view all the answers

Which statement best describes the Multinational Regional Bonded Warehouse?

It acts as a supply depot for spare parts and semi-finished products. Signup and view all the answers

What condition is applied to the products manufactured in economic zones?

Finished products are required to be exported within a specified period. Signup and view all the answers

Which legislation is associated with the establishment of the Cagayan Special Economic Zone?

Republic Act No. 7922 Signup and view all the answers

Who is responsible for issuing the Formula of Manufacture (FOM)?

The Industrial Technology Development Institute Signup and view all the answers

What is the primary function of the Freeport Area of Bataan?

It allows entities to operate under favorable trade conditions. Signup and view all the answers

What is the primary purpose of the Non-manufacturing Customs Bonded Warehouse (NCBW)?

To store raw materials for manufacturing finished products for export. Signup and view all the answers

In what condition can goods stored in a Garments and Textile Customs Bonded Warehouse be withdrawn?

Only after payment of corresponding duties, taxes, and charges. Signup and view all the answers

What does the acronym PCBW stand for?

Private Customs Bonded Warehouse Signup and view all the answers

Which of the following best describes the items allowed in a NCBW?

Raw materials for manufacturing except except garments and textiles. Signup and view all the answers

What is a key condition for goods stored in PCBWs to be exempted from import duties?

They should be purchased only in the countries crossed by international vessels or aircraft. Signup and view all the answers

What is the guideline provided by the Bureau regarding importation into Customs Bonded Warehouses?

Raw materials can be imported and stored duty and tax-free under bond. Signup and view all the answers

Which statement is true regarding stores for consumption?

Duties and taxes must be paid in the country where the goods are purchased. Signup and view all the answers

What is a significant limitation for the use of a Customs Bonded Warehouse concerning garments and textiles?

Garments and textiles are specifically excluded for certain types of bonded warehouses. Signup and view all the answers

What types of goods are exempted from import duties and taxes for vessels, aircraft, or trains?

Goods for passengers and crew Signup and view all the answers

Which of the following is NOT included in the goods exempted from duties for operation and maintenance?

Spare parts on board upon arrival Signup and view all the answers

Under what condition can stores be taken away from vessels, aircraft, or trains?

If they are intended for sale Signup and view all the answers

What must be considered when allowing the issue of stores for vessels undergoing repairs?

Length of stay in the shipyard Signup and view all the answers

What is the Bureau’s role regarding goods on board during the stay of international transport?

To allow issuance of stores for consumption Signup and view all the answers

For what purpose are goods intended for use by passengers and crew classified?

For personal use Signup and view all the answers

Which stipulation is made regarding the issuance of stores on board?

They must remain on board during customs stay Signup and view all the answers

When an aircraft lands at multiple airports in the customs territory, what is allowed?

Consumption of stores during flights between airports Signup and view all the answers

What conditions must be met for stores to be exempt from import duties and taxes when arriving in the customs territory?

Stores must remain on board the vessel, aircraft, or train. Signup and view all the answers

Which of the following stores are entitled to duty and tax exemption upon departing from the customs territory?

Stores necessary for the operation and maintenance of the vessel, aircraft, or train. Signup and view all the answers

What is required of carriers to prevent unauthorized use of stores?

They must seal the stores if necessary. Signup and view all the answers

What might trigger the requirement to remove stores from the vessel, aircraft, or train during its stay in the customs territory?

A directive from the Bureau considering it necessary. Signup and view all the answers

How should the information required for customs control be managed upon departure?

It should be kept to the minimum necessary. Signup and view all the answers

What options are available for stores on board upon arrival in the customs territory?

They can be cleared for consumption or placed under another customs procedure. Signup and view all the answers

Which of the following best describes the Bureau's authority regarding stores?

The Bureau establishes conditions for duty exemptions on stores. Signup and view all the answers

What factor is considered when determining the reasonable quantity of stores for operation and maintenance?

The length of the voyage or flight. Signup and view all the answers

Study Notes

Customs Bonded Warehouses (CBW)

Member: Entities accredited to operate in a CBW for the manufacture of products using imported duty and tax-free raw materials.
Formula of Manufacture (FOM): Issued by the Industrial Technology Development Institute (ITDI) to the CBW operator and members. It determines the usage of raw materials and waste in the manufacturing process for export.
Garments and Textile Industry Development Office (GTIDO): Government agency attached to the Department of Trade and Industry that assists in the manufacture of garments.
Multinational Regional Bonded Warehouse: Industry-specific CBW authorized by the Board of Investments (BOT) to serve as a supply depot for spare parts, semi-finished products, and raw materials. They are also used for repackaging and labeling.
Unauthorized Repacking: Fraudulent concealment, removal, or repacking of merchandise in a CBW.
Security: Guarantees satisfaction of an obligation to the Bureau of Customs, like surety bonds or letters of credit.
Semi-finished Products: Imported raw materials that have undergone initial processing for further manufacture into finished products for export.
Sub-contractor: Person or company accredited by the Bureau, and the GTIDO for garments, to perform manufacturing operations or activities.
Unauthorized Withdrawal: The withdrawal of any material or goods from a CBW without proper authorization, like a withdrawal or requisition slip.
Wastage Valuation Data Base (WVDB): Information bank used by the Bureau to assess taxes and duties on allowable waste or by-products from imported materials.

Types of Customs Bonded Warehouses (CBW)

International Customs Bonded Warehouse (ICBW)
- Established to import, receive, and store duty and tax-free raw materials (excluding garments and textiles) for manufacture into finished products.
Garments and Textile Customs Bonded Warehouse: Jointly authorized by the Bureau and the GTIDO for importing, receiving, and storing raw materials and accessories, for garment or textile production.
Customs Common Bonded Warehouse (CCBW): Authorized by the Bureau (or jointly with the GTIDO for garments) to import, receive, and store raw materials for manufacture. The goods are then exported after processing. The Bureau sets guidelines and parameters for end-user/clients (like international aviation) who use CCBWs.
Non-manufacturing Customs Bonded Warehouse (NCBW): Goods stored here are duty and tax-free, but intended for eventual withdrawal for domestic consumption. The goods are only withdrawn after payment of taxes, duties, and other charges.

Stores for Consumption

Stores for Consumption: Goods intended for passengers and crew on board vessels, aircraft, or trains, including goods necessary for their operation and maintenance.
Stores to be Taken Away: Goods for sale to passengers and crew, with the intention of being landed.
Exemption from Duties and Taxes: Stores carried on a vessel, aircraft, or train arriving in the customs territory are exempt from import duties and taxes, provided they remain on board.
Stores for Vessels, Aircrafts or Trains departing for a foreign destination
- Are exempt from duties and taxes, including stores for consumption and operation and maintenance. The Bureau determines the reasonable quantity of stores necessary.
Upon arrival in the customs territory, stores on board:
- Must be cleared for consumption or placed under another customs procedure. Alternatively, subject to prior Bureau authorization, they can be transferred to another vessel, aircraft, or train assigned to an international route.

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Description

Explore the essential concepts surrounding Customs Bonded Warehouses (CBW) including the role of accredited members, the importance of the Formula of Manufacture (FOM), and the functions of agencies like the Garments and Textile Industry Development Office. Understand the implications of unauthorized repacking and the operations of multinational bonded warehouses.