DETAILED PROCEDURES TO FURTHER IMPLEMENT CMO 3-2000

Pursuant to Section 608, Tariff and Customs Code of the Philippines
(TCCP), as amended, the following rules and regulations are hereby
promulgated to complement/further implement CMO 3-2000:

I.          OBJECTIVES

1.   To determine the import entry declaration that will be
subject to the Valuation and Classification Review Committee (VCRC)
established in CMO 3-2000, prescribing the more detailed procedures
therefor;

2.   To further enhance the application of the WTO Valuation
System in the import clearance processes of shipments, facilitating the
clearance of legitimate commerce while protecting government revenues.

II.         SCOPE

This Order shall apply to all importation in all ports except those covered by the Super Green Lane facility.

III.        ADMINISTRATIVE PROVISIONS

1.      Except as herein otherwise provided, the VCRC which shall
be organized in every District Port shall be composed of the following:

a.    District Collector — Chairman
b.    Deputy Collector for Assessment — Vice Chairman
c.    Chief, Formal Entry Division or Equivalent Unit — Member

2.      At the Port of Manila, Manila International Container Port
and the NAIA Customshouse, other Customs officials may be designated to
the VCRC as Chairman, Vice-Chairman or member, upon the recommendation
of the concerned District Collector and approval of the Commissioner of
Customs. Provided that the Chairman and Vice-Chairman shall have the
rank not lower than a Collector of Customs IV/COC while the member, not
lower than a COAC.

3.      The concerned COO V and COO III of the Formal Entry
Division or equivalent units shall act as resource persons to the VCRC.

4.      The VCRC Secretariat established in Paragraph III.10.1 of
CMO 3-2000 shall be renamed as the VCRC Technical Support Team
(VCRC-TST) and shall be headed by the Vice-Chairman, unless the
concerned District Collector assigns other qualified Customs official.

5.      At the NAIA Customs, a VCRC Technical Support Team shall
be established in each of the Customs Clearing Warehouse and shall be
headed by the respective Special Deputy Collector, unless the District
Collector assigns other qualified Customs official.

IV.       PROCEDURES

Upon the selectivity processing of import entry declaration, the following procedures apply:

AT THE CONCERNED SECTION, FORMAL ENTRY DIVISION

1.    COO V opens selectivity module to verify whether the clearance channel assigned to the shipment is Yellow or Red.

2.    COO V clicks criteria screen to check whether the shipment is hit by the valuation screen, among others.

3.    If the shipment is selected Yellow or Red, and hit by the
Valuation Screen, or there is an appraiser-initiated
valuation/classification issue(s), the COO V shall perform the
following:

a.      Stamp the word “VALUATION” on the free space between
boxes 58 and 59 of the Entry, and on the Temporary Assessment Notice
(TAN); and,

b.      Indicate in writing whether the selection is Yellow (Y)
or Red (R) and if the shipment is regulated, the reason(s) or basis. In
case of multiple item declaration, the said remarks shall be indicated
for each item.

4.    COO V assigns entry to COO III who shall undertake any of the following:

Case A: If selected Yellow and hit by Valuation Screen.  Conducts documentary examination.
If physical examination were deemed necessary for the shipment, the
same may only be undertaken upon the written approval of the District
Collector of Customs, or in case of air shipments, the Special Deputy
Collector of the concerned Customs Clearing Warehouse, stating the
reasons therefor.

Case B: If selected Red and hit by Valuation Screen.  Conducts documentary examination. A physical examination shall also be performed on the shipment as a matter of course.

Case C: Not hit by the Valuation Screen but the Appraiser contests the declared value. 
Indicates in the Request for VCRC Review (VCRC Form No. 1), Annex 1
herein, that the request for VCRC review is appraiser-initiated by
checking the appropriate box, including the reason(s) for such action.
No physical examination shall be conducted on the shipment

Case D: Whether or not hit by the Valuation Screen but the Appraiser contests the classification. 
Indicates in VCRC Form No. 1 that the request for VCRC review is
appraiser-initiated by checking the appropriate box, including the
reason(s) for such action. No physical examination shall also be
conducted on the shipment.

5.   In any of the above cases, the COO III shall perform the following:

a.      Verifies the CDSS/GVSS/Current ROs for value/classification information;

b.      Produce a print out of all the relevant information gathered from these sources;

c.       Prints and signs his name in every page of the print outs; and,

d.      Attaches all the signed print outs to the Entry. If
printouts consist of more than 10 pages, the printouts up to 10 pages
may only be attached to the entry, in which case the COO III must
indicate in writing the total number of pages the printouts to consist
of.

6.    COO III fills up the VCRC Form No. 1, attaches the duly
filled up form to the Entry and forwards same with all the
attachments/supporting documents to VCRC-TST.

AT THE VCRC TECHNICAL SUPPORT TEAM

7.   Upon receipt of the concerned documents, the VCRC-TST
receiving clerk assigns a docket number to the case, enters the same in
the VCRC-TST logbook and forwards the case documents to the Head,
VCRC-TST.

8.   The Head, VCRC-TST, may decide the case and authorize the
release of the concerned shipment if any of the following circumstances
exists:

a)      Single-item entries whose f.o.b. value as per
appraiser’s findings are not more than $500 for seaports, and $100 for
airports.

b)      The importer manifests in writing to pay based on the
highest comparative value on record per GVSS, CDSS, RO 99 or any later
ROs, or latest rulings of the BOC-SGS Appeals Committee or VCRC.

c)      The importer manifests in writing to pay based on the
latest classification rulings by the DOF, the Commissioner of Customs,
BOC-SGS Appeals Committee or VCRC.

9.   In any of the above cases, the Head, VCRC-TST, fills up the
VCRC Disposition Form (VCRC Form No. 2), Annex 2 herein and refers it
with the Entry to the concerned COO V for final assessment, which shall
then be forwarded to the Collection Division for payment verification
and/or collection of additional payment, if any.

10. Where the disposition however requires additional payment of
duties and taxes by 10% or more of the original assessment, the COO V
shall instead make a discrepancy report and forwards it with the Entry
and all its attachments to the District Collector who shall:

a.      Impose the appropriate surcharge; or

b.      In case of discrepancy by 30% or more, take such appropriate action in accordance with the TCCP.

11.    Unless otherwise directed, the COO V shall make a final
assessment based on the action of the District Collector, which shall
then be forwarded to the Collection Division for the settlement of
additional payment, including the surcharge(s).

12.    The Head, VCRC-TST shall submit a daily report of all his
decisions and actions of such cases to the District Collector.

13.    The Head, VCRC-TST shall forward to the VCRC Chairman all
other valuation/classification cases not resolved nor acted upon by the
VCRC-TST, including those with a combination of value and classification
issues as well as other issues specifically raised in writing by the
COO V, for VCRC resolution.

14.    The Head, VCRC-TST, shall transmit all subject cases to the
VCRC Chairman, recording in the logbook the docket numbers of such
cases, their captions, among other relevant information, indicating the
time and date such cases were referred to and received by said Office.

15.    On the basis of such transmittals the Head, VCRC-TST, shall
prepare a case digest for all the cases referred to the VCRC and the
agenda to be deliberated by the VCRC.

AT THE VCRC

16.    The VCRC Chairman shall convene the committee to deliberate
the matters in the agenda every Thursdays and/or as often as necessary.
All cases pending or not resolved in the last meeting are automatically
calendared for the next meeting until the same is resolved, in addition
to the new matters in the agenda.

17.    Cases resolved by the VCRC shall continue to be listed in
the agenda for final confirmation by the VCRC before these are finally
taken out of the agenda.

18.    Those taken out of the agenda can no longer be reopened,
except to correct manifest clerical error, or when the text of the
resolution is different from what was decided upon during the
deliberation as borne out by the records of the deliberations, or on
account of a newly discovered evidence which was not available or could
not be obtained during the deliberation of the case.

19.    The VCRC-TST shall record the minutes of VCRC meetings and
based on such records, prepare the VCRC decision for every case for the
signature by the VCRC Chairman.

20.    Based on the signed VCRC decision, the Head, VCRC-TST,
shall fill -up VCRC Form No. 2 accordingly and refer the same to the
section concerned for implementation.

21.    The Head, VCRC-TST, shall submit to the VCRC Chairman a
running weekly report of the cases referred to VCRC and the action taken
by it.

22.    The VCRC Chairman shall in turn submit a weekly
consolidated report to the Commissioner and Deputy Commissioner,
Assessment and Operations Group, using the VCRC Form No. 3, attached
herein as Annex 3. The report shall be categorized as follows:

a.      Decision by VCRC-TST

b.      Decision by VCRC

V.        TENTATIVE RELEASE

23.  Cases referred to the VCRC shall entitle the importer for the
Tentative Release of the shipment concerned. The Head, VCRC-TST shall
grant tentative release as a matter of course upon the posting a cash
bond, manager’s check or bank guarantee per CAO 4-99, except as
otherwise herein provided, to answer for the duties and taxes payable in
the event of a decision adverse to the importer. If no Tentative
Release is availed of, the Head, VCRC-TST, shall immediately calendar
the case for VCRC deliberation and the VCRC shall give priority to the
same.

24.  The amount of the security shall be as follows:

For Case No. 1, and Case No. 2, where applicable, the amount of
guarantee is equivalent to the difference between the payables assessed
using the highest value on record and the assessment/payment based on
the declaration, plus 25% thereof.

For Case No. 3, no guarantee is required except when there is
also an issue on tariff classification in which case, the amount shall
be the difference between the payables based on the declared tariff rate
and as found by the Appraiser. In case no guarantee is required, the
covering entry shall be marked as “Under tentative liquidation”.

For Case No. 4, the amount of guarantee is equivalent to the
difference in the payables between the declared tariff rate and as found
by the Appraiser.

VI.       APPEALS

25.    If the importer disputes the decision of the VCRC, the
importer may appeal said decision to the Commissioner of Customs by
submitting a Notice of Appeal to the VCRC Chairman within 15 days from
receipt of the VCRC decision. The Notice of Appeal must contain, among
others, an assignment of errors of the VCRC decision.

26.    The VCRC Chairman shall forward the records of the case to
the Commissioner of Customs within 5 days from receipt of the Notice of
Appeal with a covering memorandum stating out briefly the factual and
legal basis of the VCRC decision.

VII.      REPEALING CLAUSE

CMO Nos. 25-99 and 26-99 and all other Orders, Memorandums,
Circulars or parts thereof which are inconsistent with this Order are
hereby deemed repealed and/or modified accordingly.

VIII.     EFFECTIVITY

This order shall take effect fifteen (15) days from signing.

Adopted: 01 Sept. 2000

(SGD.) RENATO A. AMPIL
Commissioner