Questions and Answers
What is the maximum rate of import duty that can be imposed under the Flexible Clause?
Under what circumstances can the President exercise the powers granted by the Flexible Clause?
What does the MFN principle entail according to international trade agreements?
Which entity can recommend changes to import duties under the Flexible Clause?
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What additional duty may be imposed on imports not exceeding a certain percentage?
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What does MFN tariff stand for in the context of international trade?
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What is the purpose of the ASEAN Trade in Goods Agreement (ATIGA)?
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Under ATIGA, what is required for a product to be eligible for preferential tariff treatment?
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What action is NOT required before the President of the Philippines can enter into trade agreements?
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Which of the following countries is NOT an ASEAN member state?
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What does the Rice Tariffication Law aim to achieve?
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In Example No. 2, what duty rate applies to the tomatoes exported from Singapore to the Philippines?
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What oversight is mandated before concluding trade agreements?
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What is a major requirement for products to qualify for concession under ATIGA concerning MFN rates?
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Study Notes
Flexible Clause and Promotion of Foreign Trade
- The Flexible Clause allows the President, upon NEDA's recommendation, to adjust import duty rates, establish quotas, and impose additional duties in the interest of general welfare and national security.
- Import duty increases cannot exceed 100% ad valorem; the President's power is limited to when Congress is not in session.
- The Most Favored Nation (MFN) principle prohibits discrimination between trading partners; it applies globally to non-ASEAN and non-FTA members.
- Under the MFN principle, the Philippines charges a 15% tariff on plastics from both Japan and China.
Promotion of Foreign Trade
- The President is authorized to negotiate trade agreements and modify import duties to enhance foreign trade.
- Public notice and opportunities for input must precede any trade agreements, involving consultations with several government departments such as DTI, DA, DOF, DENR, DFA, and BSP.
ASEAN Trade in Goods Agreement (ATIGA)
- ATIGA provides preferential tariffs on goods traded among ASEAN member states, requiring specific tariff reduction commitments.
- Eligibility for ATIGA concessions includes products with tariffs at or below 20% and compliance with origin requirements specified in the ATIGA Rules of Origin (ROO).
- A Certificate of Origin "D" is necessary to validate preferential tariff treatment under ATIGA.
ASEAN Member States
- Member countries include Thailand (TH), Indonesia (ID), Malaysia (MY), Philippines (PH), Singapore (SG), Brunei Darussalam (BN), Vietnam (VN), Lao PDR (LA), Myanmar (MM), and Cambodia (KH).
Application of ATIGA
- Eligible ATIGA products must be on the Inclusion List and meet specific origin criteria.
- Examples include:
- Laos exporting fresh meat to the Philippines, leading to a 5% MFN duty.
- Singapore exporting tomatoes to the Philippines, resulting in a 0% ATIGA duty.
- Myanmar exporting an antique, classified under an exception, triggering a 7% MFN duty.
Rice Tariffication Law (Republic Act No. 11203)
- RA 11203, signed on February 14, 2019, amends the Agricultural Tariffication Act of 1996.
- The law removes quantitative restrictions on rice imports and replaces them with a general tariff framework.
- It enables the private sector to import rice freely, subject to tariffs, enhancing market accessibility.
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Description
This quiz covers the Flexible Clause and the promotion of foreign trade, specifically discussing RA 11203, RA 8502, and EO 156. It delves into the powers granted to the President regarding import duties in the context of national welfare and security.
