QuestionsQuestions (LETTER OF INSTRUCTIONS NO. 487)
Executive Order No. 461 was issued upon the recommendation of the Board of Investments pursuant to Section 8(a) of Republic Act No. 5186 (Investment Incentives Act).
The production in the Philippines of sodium tripolyphosphate, manufactured by Polyphosphates Inc. registered by the Board of Investments, was certified as a preferred pioneer industry entitled to post-operative tariff protection.
It refers to increased customs duty rates that apply after the pioneer industry begins operations (i.e., post-operation period), intended to protect the domestic producer against competing imports.
The Board of Investments registered Polyphosphates Inc. for manufacturing sodium tripolyphosphate. This registration is significant because it serves as the factual basis for the certification to receive tariff protection.
It cited increased costs of raw materials that made the project viable only with interim tariff protection against competing imported items, which it described as draining foreign exchange resources.
It granted a post-operative tariff protection in the form of increased customs duty on sodium tripolyphosphates, specifically setting the duty rate for the listed tariff heading under Section 1.
For phosphates/hypophosphates/phosphates not included in Subheading B: ad valorem 10%. For sodium tripolyphosphates (Subheading B): ad valorem 30%.
It stated that the listed articles are classified under Section 104 of Republic Act No. 1937 as amended by Presidential Decree No. 34.
After the expiration of thirty (30) days from the issuance of the Order, all described articles entered or withdrawn from warehouses in the Philippines for consumption become subject to the prescribed rates.
It limits applicability to import entries/withdrawals for consumption occurring after the 30-day post-issuance period; imports not yet entered or withdrawn for consumption would not be subject to the new rates unless the transaction occurs within the coverage.
It provided that at any time during the Order’s effectivity, the post-operative tariff rate may be modified in accordance with Section 401 of the Tariff and Customs Code when the existing conditions in the industry warrant such modification.
It was signed by President Ferdinand E. Marcos, with an attestation by Juan C. Tuvera, Presidential Assistant. This reflects the President’s authority to issue executive orders as provided by law.
It specifies tariff protection for the production of sodium tripolyphosphate as a preferred pioneer industry, through increased customs duty on sodium tripolyphosphates, applying to specified imported articles classified under the cited tariff heading.
The Order sets increased customs duty rates on imported sodium tripolyphosphates and related articles; it does not restrict the tariff to imports by a specific importer. Thus, the duty rate applies generally to imports of the described articles.