2024 CUSTOMS LAWS TUTORIAL - D1.pdf

CLAP CUSTOMS REVIEW & CENTER FOR PROFESSIONAL DEVELOPMENT, INC. in coordination with PEDREZA CUSTOMS AND TARIFF WEBINARS Room 209, 2nd Floor, Manuel F....

CLAP CUSTOMS REVIEW & CENTER FOR PROFESSIONAL DEVELOPMENT, INC. in coordination with PEDREZA CUSTOMS AND TARIFF WEBINARS Room 209, 2nd Floor, Manuel F. Tiaoqui Bldg., Plaza Sta. Cruz, Manila Contacts - Globe: 09063811016 / 09068172757 Email: [email protected] FB: www.facebook.com/clap.stacruz/ 2024 CUSTOMS LAWS TUTORIAL – DAY 1 Bureau of Customs: Administration, Jurisdiction and Functions ATTY. NORBERTO V. CASTILLO, CB, MBA Administration The State 3 branches of the government Important Doctrines Executive Legislative State Immunity from Suit Judiciary Primary Jurisdiction Exhaustion of Administrative Remedies The Independent Constitutional Commissions Hierarchy Presumption of regularity Civil Service Commission Nepotism Commission on Audit Commission on Elections The Sandiganbayan The Ombudsman Inherent Powers of the State Police Eminent Domain Taxation SOURCES OF LAWS, RULES AND REGULATIONS ENFORCED IN THE BUREAU OF CUSTOMS The 1987 Constitution In case of conflict, how should laws be interpreted? The Suprema Lex doctrine Harmonization Laws, P.D., E.O., Express vs. Implied repeal Jurisprudence, General vs. Special Orders promulgated by the BOC Date of promulgation Classification of Orders Decisions rendered by the BOC POWERS OF THE BOC How Customs apply jurisdiction Investigatory - Customs Districts Rule-making (Quasi-legislative) Ports of Entry Adjudicatory (Quasi-judicial) - Principal Ministerial - Sub-port Discretionary - Revenue Districts (BIR) Limitations on Customs Jurisdiction/Powers Due Process clause under the Constitution; Establishment of probable cause prior to issuance of Warrant of Seizure; Search of dwelling house; Prior authorization from the Commissioner for the Final Assessment Notice; AFP, PNP; Audit Notification Letter prior to Customs Audit; Presence of other personalities during physical examination of goods; Section 200. Chief Officials of the Bureau The Bureau shall be headed by a Commissioner and shall be assisted by at least four (4) but not more than six (6) Deputy Commissioners. The Commissioner shall be appointed by the President of the Philippines. ATTY. NORBERTO V. CASTILLO, CB, MBA Page 1 of 6  CLAP CUSTOMS REVIEW & CENTER FOR PROFESSIONAL DEVELOPMENT, INC. in coordination with PEDREZA CUSTOMS AND TARIFF WEBINARS Room 209, 2nd Floor, Manuel F. Tiaoqui Bldg., Plaza Sta. Cruz, Manila Contacts - Globe: 09063811016 / 09068172757 Email: [email protected] FB: www.facebook.com/clap.stacruz/ The Deputy Commissioners shall also be appointed by the President and at least majority of whom shall come from the ranks of the Bureau. The 7 Offices of the Deputy/Asst. Commissioners Revenue Collection Monitoring Group Assessment and Operation Coordinating Group Post-Clearance Audit Group (EO 160) Enforcement Group Management Information System and Technology Group Internal Administration Group Intelligence Group The Commissioner The Deputy Commissioners Qualification standard Qualification Standards - Bachelor’s degree - Bachelor’s degree - 3 years of supervisory experience - 3 years supervisory experience - Training, not necessary - Training, not required - Career Service Executive Eligibility (CSEE) - CSEE - Career Executive Service - CES - Appointment to office Appointment to office The case of Sarmiento vs. Mison Vacancy in the office ▪ Revenue Collection Monitoring Group (RCMG). Under a Deputy Commissioner, this group: ✓ maintains an accounting of revenues collected; ✓ administers the legal requirements of the BOC; ✓ provides information and analysis of collection statistics; and ✓ audits liquidated entries and bonds. (customs.gov.ph) ▪ Assessment and Operations Coordination Group (AOCG). Under a Deputy Commissioner, this group: ✓ gathers and publishes values of commodities imported into the country; and ✓ monitors implementation of rules and regulations governing assessment, end processing of goods for exports, warehousing and support operations, and auction and disposal activities. ▪ Post Clearance Audit Group (PCAG). CMO No. 32-2017 reactivates the Post Clearance Audit Group (PCAG) formerly known as Post Entry Audit Group (PEAG). PEAG was created in 2003 under EO 160-2003 and tasked to perform post-clearance audit work of the Bureau of Customs. EO No. 46 on October 2017 returns the post-clearance audit function to the BOC. Headed by an Assistant Commissioner who has direct supervision and control over the management of the operating units of PCAG, which include the Trade Information and Risk Analysis Office and Compliance Assessment Office. (customs.gov.ph) ▪ Enforcement Group (EG). Under a Deputy Commissioner, this group: ✓ Exercises police authority to secure the country’s ports and BOC installations; and ✓ to protect cargoes and properties inside the customs zone. ▪ Management Information System and Technology Group (MISTG). The implementation of BOC’s computerization program necessitated the creation of MISTG on January 9, 1998 under E.O. 463. (customs.gov.ph) ▪ Intelligence Group (IG). Under a Deputy Commissioner, this group: ✓ gathers intelligence information related to Customs and economic activities; ✓ conducts internal inquiry and investigation; and ✓ develop effective countermeasures to combat corruption, smuggling, and other forms of customs fraud. ▪ Internal Administration Group (IAG). Under a Deputy Commissioner, this group; ✓ assists the Commissioner in the formulation of policies and in the setting up of objectives relative to financial, administrative, personnel, planning and management improvement services of the BOC; ✓ represents the Commissioner in meetings and conferences; ✓ signs memorandum circulars; and ✓ reviews official communications and documents relevant to internal administration. (customs.gov.ph) ATTY. NORBERTO V. CASTILLO, CB, MBA Page 2 of 6  CLAP CUSTOMS REVIEW & CENTER FOR PROFESSIONAL DEVELOPMENT, INC. in coordination with PEDREZA CUSTOMS AND TARIFF WEBINARS Room 209, 2nd Floor, Manuel F. Tiaoqui Bldg., Plaza Sta. Cruz, Manila Contacts - Globe: 09063811016 / 09068172757 Email: [email protected] FB: www.facebook.com/clap.stacruz/ Customs Districts and Ports of Entry Section 206. Customs Districts For administrative purposes, the Philippines shall be divided into as many Customs Districts as necessary, the respective limits of which may be changed from time to time by the Commissioner, with the approval of the Secretary of Finance. Each Customs District shall be supervised by one (1) District Collector, assisted by as many Deputy District Collectors as may be necessary. The choice of the location of a District Office, its business hours and the staffing pattern thereof, shall be based on the particular requirements of each district. Section 207. Ports of Entry All ports of entry shall be under the supervision and control of a Customs District. A District Collector shall be assigned in the principal ports of entry while a Deputy District Collector may be assigned to other types of ports of entry. Principal ports of entry: (M2IND BL2AS3TC3Z) 1. Aparri (EO 707, CAO 02-2008) 7. Iloilo 13. San Fernando 2. Batangas (CAO 04-2014) 8. Legaspi 14. Subic 3. Cagayan de Oro (CAO 04-2020) 9. Limay (EO727, CAO 05-2008) 15. Surigao 4. Cebu 10. Manila (CAO 02-2002) 16. Tacloban 5. Clark (EO 55, CAO 02-2002) 11. MICP 17. Zamboanga 6. Davao 12. NAIA Officials and their Salary Grades (CMO 17-02) Commissioner 30 Collector IV 24 COO V 20 Deputy Commissioner 28 Collector III 23 COO IV 18 Director III 27 Collector II 22 COO III 16 Collector VI 26 Collector I 21 COO II 13 Collector V 25 COO I 11 Jurisdiction (1) TERRITORIAL JURISDICTION Section 300. Customs Jurisdiction.— For the effective implementation of this Act, the Bureau shall exercise jurisdiction over all seas within Philippine territory and all coasts, ports, airports, harbors, bays, rivers and inland waters whether navigable or not from the sea and any means of conveyance. The Bureau shall pursue imported goods subject to seizure during its transport by land, water and air and shall exercise jurisdiction as may be necessary for the effective enforcement of this Act. When a vessel or aircraft becomes subject to ATTY. NORBERTO V. CASTILLO, CB, MBA Page 3 of 6  CLAP CUSTOMS REVIEW & CENTER FOR PROFESSIONAL DEVELOPMENT, INC. in coordination with PEDREZA CUSTOMS AND TARIFF WEBINARS Room 209, 2nd Floor, Manuel F. Tiaoqui Bldg., Plaza Sta. Cruz, Manila Contacts - Globe: 09063811016 / 09068172757 Email: [email protected] FB: www.facebook.com/clap.stacruz/ seizure for violation of this Act, a pursuit of such vessel or aircraft which began within the territorial waters or air space may continue beyond the same, and the vessel or aircraft may be seized in the high seas or international air space. Republic Act No. 9522 AN ACT TO AMEND CERTAIN PROVISIONS OF R.A. 3046 AS AMENDED BY R.A. 5446, TO DEFINE THE ARCHIPELAGIC BASELINE OF THE PHILIPPINES (March 10, 2009) ▪ Section 3. This Act affirms that the Republic of the Philippines has dominion, sovereignty and jurisdiction over all portions of the national territory as defined in the Constitution and by provisions of applicable laws including, without limitation, the Local Government Code of 1991, as amended. ▪ Section 2. The baseline in the following areas over which the Philippines likewise exercises sovereignty and jurisdiction shall be determined as "Regime of Islands" under the Republic of the Philippines consistent with Article 121 of the United Nations Convention on the Law of the Sea (UNCLOS): a) The Kalayaan Island Group as constituted under Presidential Decree No. 1596; and b) Bajo de Masinloc, also known as Scarborough Shoal. ILLUH ASAALI, ET. AL. vs. THE COMMISSIONER OF CUSTOMS (G.R. No. L-24170, December 16, 1968) Revised Penal Code Article 2. Application of its provisions. - Except as provided in the treaties and laws of preferential application, the provisions of this Code shall be enforced not only within the Philippine Archipelago, including its atmosphere, its interior waters and maritime zone, but also outside of its jurisdiction, against those who: xxx xxx xxx 1. Should commit an offense while on a Philippine ship or airship; xxx xxx xxx (2) Jurisdiction over Goods ▪ Section 202, par (h): Supervision and control on all import and export cargoes, landed or stored in piers, airports, terminal facilities, including container yards and freight stations for the protection of government revenue and prevention of entry of contraband; ▪ Section 301. Customs Control Over Goods.— All goods, including means of transport, entering or leaving the customs territory, regardless of whether they are liable to duties and taxes, shall be subject to customs control to ensure compliance with this Act. Customs control of premises as an incident to jurisdiction over goods ▪ Section 303. Control Over Premises Used for Customs Purposes.— The Bureau shall, for customs purposes, have exclusive control, direction and management of customs offices, facilities, warehouses, ports, airports, wharves, infrastructure and other premises in the Customs Districts, in all cases without prejudice to the general police powers of the local government units (LGUs), the Philippine Coast Guard and of law enforcement agencies in the exercise of their respective functions. ▪ (3) Jurisdiction over the transaction (pre-release) ▪ Section 400. Goods to be Imported through Customs Office.— All goods imported into the Philippines shall be entered through a customs office at a port of entry, or may be admitted to or removed from a free zone as defined in this Act, as the case may be. ▪ Jurisdiction of District vs. Jurisdiction of Central (3) Jurisdiction over the transaction (post-release) ▪ Section 1000. Audit and Examination of Records.— Within three (3) years from the date of final payment of duties and taxes or customs clearance, as the case may be, the Bureau may conduct an audit examination, inspection, verification, and investigation of records pertaining to any goods declaration, which shall include statements, declarations, documents, and electronically generated or machine readable data, for the purpose of ascertaining the correctness of the goods declaration and determining the liability of the importer for duties, taxes and other charges, including any fine or penalty, to ensure compliance with this Act. ATTY. NORBERTO V. CASTILLO, CB, MBA Page 4 of 6  CLAP CUSTOMS REVIEW & CENTER FOR PROFESSIONAL DEVELOPMENT, INC. in coordination with PEDREZA CUSTOMS AND TARIFF WEBINARS Room 209, 2nd Floor, Manuel F. Tiaoqui Bldg., Plaza Sta. Cruz, Manila Contacts - Globe: 09063811016 / 09068172757 Email: [email protected] FB: www.facebook.com/clap.stacruz/ (4) Jurisdiction over the person of the importer ▪ Section 1001. Scope of the Audit.— The audit of importers shall be conducted when firms are selected by a computer-aided risk management system, the parameters of which are to be based on objective and quantifiable data, subject to the approval of the Secretary of Finance upon recommendation of the Commissioner. (5) Jurisdiction over vessels, aircrafts, conveyances ▪ Section 202. Functions of the Bureau.— The Bureau shall exercise the following duties and functions: xxx xxx xxx (f) Supervision and control over the entrance and clearance of vessels and aircraft engaged in foreign commerce. xxx xxx xxx FUNCTIONS Section 202. Functions of the Bureau a) Assessment and collection of customs revenues from imported goods and other dues, fees, charges, fines and penalties accruing under this Act; b) Simplification and harmonization of customs procedures to facilitate movement of goods in international trade; c) Border control to prevent entry of smuggled goods; d) Prevention and suppression of smuggling and other customs fraud; e) Facilitation and security of international trade and commerce through an informed compliance program; f) Supervision and control over the entrance and clearance of vessels and aircraft engaged in foreign commerce; g) Supervision and control over the handling of foreign mails arriving in the Philippines for the purpose of (1) collecting revenues and (2) preventing the entry of contraband; h) Supervision and control on all import and export cargoes, landed or stored in piers, airports, terminal facilities, including container yards and freight stations for the (1) protection of government revenue and (2) prevention of entry of contraband; i) Conduct a compensation study with the end view of developing and recommending to the President a competitive compensation and remuneration system to attract and retain highly qualified personnel, while ensuring that the Bureau remains financially sound and sustainable; j) Exercise of exclusive original jurisdiction over forfeiture cases under this Act; and k) Enforcement of this Act and all other laws, rules and regulations related to customs administration. Section 201. Powers and Functions of the Commissioner a) Exclusive and original jurisdiction to interpret the provisions of this Act, in collaboration with other relevant government agencies, subject to review by the Secretary of Finance; b) Exercise any customs power, duties and functions, directly or indirectly; c) Review any action or decision of any customs officer performed pursuant to the provisions of this Act; d) Review and decide disputed assessments and other matters related thereto, subject to review by the Secretary of Finance and exclusive appellate jurisdiction of the Court of Tax Appeals (CTA); e) Delegate the powers vested under this Act to any customs officer with the rank equivalent to division chief or higher, except for the following powers and functions: (1) Promulgation of rules and regulations; (2) Issuance, revocation or modification of rulings; and (3) Compromise or abate of customs obligations. f) Assignment or reassignment of any customs officer subject to the approval of the Secretary of Finance; Provided, That District Collectors and other customs officers that perform assessment functions shall not remain in the same area of assignment for more than three (3) years; and g) Perform all other duties and functions as may be necessary for the effective implementation of this Act and other customs related laws. Section 210. Duties of the District Collector. 1. Ensure entry of all imported goods at the customs office; 2. Prevent importation and exportation of prohibited goods; 3. Ensure legal compliance of regulated goods and facilitate the flow of legitimate trade; 4. Examine, classify and value imported goods; 5. Assess and collect duties, taxes and other charges on imported goods; 6. Hold and dispose imported goods in accordance with this Act; ATTY. NORBERTO V. CASTILLO, CB, MBA Page 5 of 6  CLAP CUSTOMS REVIEW & CENTER FOR PROFESSIONAL DEVELOPMENT, INC. in coordination with PEDREZA CUSTOMS AND TARIFF WEBINARS Room 209, 2nd Floor, Manuel F. Tiaoqui Bldg., Plaza Sta. Cruz, Manila Contacts - Globe: 09063811016 / 09068172757 Email: [email protected] FB: www.facebook.com/clap.stacruz/ 7. Prevent smuggling and other customs fraud; and 8. Perform other necessary duties that may be assigned by the Commissioner for the effective implementation of this Act. Subject to the supervision and control of the District Collector, the duties and functions of the District Collector may be delegated to the Deputy District Collector. The Deputy District Collector assigned to a sub-port shall be under the supervision and control of the District Collector of the corresponding principal port. Powers and Duties of the Secretary of Finance ▪ Approve Commissioner’s: ✓ assignment or reassignment of any customs officer (Sec. 201) ✓ Promulgation of IRRs (Sec. 204) ✓ changing of limits of Customs Districts. (Sec. 206) ✓ action pertaining to marking of imported goods and containers. (Sec. 710) ✓ adjustment of the amount of the carrier’s security. (Sec. 602) ▪ Adjust: ✓ the threshold FCA/FOB value for goods of commercial nature to be cleared under informal entry (Sec. 402) ✓ de minimis value every three (3) years. (Sec. 423 ✓ FCA/FOB value of personal and household effects of returning residents and balikbayan boxes for duty and tax exemption every three years. (Sec. 800 (f) and (g) Powers of the President under CMTA To appoint BOC and TC officials (Sec. 200 and 1600) To open or close any port (Sec. 208) To subject premises to customs jurisdiction (Sec. 304) Discrimination powers (Sec. 714) To suspend, disallow or withdraw conditionally free importation (Sec. 800) To declare as habit forming narcotics or synthetic drugs (Sec. 1147) To release from detention warlike vessels (Sec. 1216) Flexible tariff (Sec. 1608 and 1609) ATTY. NORBERTO V. CASTILLO, CB, MBA Page 6 of 6