Question & AnswerQ&A (OP EXECUTIVE ORDER NO. 79)
The purpose of Executive Order No. 79 is to modify the rates of import duty on certain imported articles to implement a minimum 50% margin of preference on certain automotive products under the Brand-to-Brand Complementation Scheme of the ASEAN Industrial Complementation Agreement.
The order references the Revised Basic Agreement on ASEAN Industrial Complementation (BAAIC) signed in 1981 and the Memorandum of Understanding on the Brand-to-Brand Complementation Scheme in the Automotive Industry signed in 1988.
The BBC Scheme is an ASEAN initiative where member countries collaborate in automotive parts production and trade, allowing for mutual imports and exports of automotive parts with preferential tariffs under a margin of preference.
A 50% MOP means that the import duty on specified automotive parts listed is reduced by at least 50% compared to the regular tariff rates, providing preferential treatment under ASEAN trade agreements.
The order specifically mentions Mitsubushi Motor Corporation, Nissan Motor Co., Ltd., and Toyota Motor Corporation as participants in the BBC Schemes.
The MOP is granted initially effective up to January 23, 1995, with provisions for extension depending on reciprocal agreements with non-participating ASEAN countries.
If a non-participating country does not extend the same Margin of Preference during the stipulated waiver period, the exclusive application of the MOP to participating countries (Thailand, Malaysia) is extended up to January 23, 1999.
No, the 50% MOP shall remain effective irrespective of changes in the basic Philippine rate of duty on the covered articles.
Imported articles must qualify under the Rules of Origin as prescribed in the Agreement on ASEAN Preferential Trading Agreements ratified on August 7, 1977.
Revisions to the part numbers must be immediately communicated to the Philippine Government, after which the Department of Trade and Industry will endorse the revisions to the Bureau of Customs within five days.