Question & AnswerQ&A (Republic Act No. 5490)
The policy is to stimulate, expedite, encourage, and promote foreign commerce to make the Philippines a vital center of international trade, strengthen foreign exchange, hasten industrialization, overcome unemployment, accelerate development, and ensure economic security for all Filipinos.
Mariveles, Province of Bataan, is established as a principal port of entry under this Act.
The Foreign Trade Zone in Mariveles is a designated area where foreign and domestic merchandise can be brought without being subject to customs and internal revenue laws except as provided, and where merchandise may be stored, sold, manipulated, manufactured (with restrictions), exported, destroyed, or sent into the customs territory under certain conditions.
Merchandise prohibited by law cannot be brought into the Foreign Trade Zone.
It becomes subject to all laws and regulations applicable to imported merchandise, including duties and taxes, which must be liquidated under customs supervision.
The Foreign Trade Zone Authority is created, composed of a Chairman and four members appointed by the President with the Commission on Appointments' consent, serving staggered six-year terms.
They must be Filipino citizens, of good moral character, unquestionable integrity and responsibility, and competent in customs administration, taxation, economics, commerce, or industry.
The Authority can define the Zone's site, regulate enterprises therein, operate the Zone as a public utility with fair rates, grant permits for use of the Zone, authorize expenditures, issue rules, appoint and remove employees, and exercise necessary powers to fulfill the Act’s objectives.
Violators face imprisonment from five to ten years, fines between five thousand and ten thousand pesos, and possible revocation of privileges. If the offender is a corporation or similar entity, penalties extend to guilty officers, including deportation of alien officers. Government officers who tolerate violations may also be penalized and disqualified from public office.
If tax and duties on foreign-made articles in the Zone are not paid after revocation of authority, such articles and related property may be forfeited to the government and disposed of as desired after due process.
The Secretary of Finance prescribes necessary rules and regulations, assigns customs officers and guards to the Zone, oversees supervision of merchandise, and may prescribe regulations to safeguard revenue including vessel operations.
An appropriation of two hundred fifty thousand pesos from the National Treasury is authorized for the fiscal year 1969 to carry out the purposes of the Act.
The Act takes effect upon its approval.