Question & AnswerQ&A (OP EXECUTIVE ORDER NO. 487)
Executive Order No. 487 modifies the rates of duty on certain imported articles under the Tariff and Customs Code of 1978, as amended, to implement the 1998-2003 Philippine Schedule of Tariff Reduction for products transferred from the Temporary Exclusion List to the Inclusion List under the ASEAN Free Trade Area (CEPT-AFTA) scheme.
The order is issued pursuant to the powers vested in the President of the Philippines by law, specifically to implement tariff reduction schedules agreed upon under the ASEAN Common Effective Preferential Tariff (CEPT) Scheme for AFTA.
Section 1 states that articles listed in Annex 'A' are subject to the ASEAN Common Effective Preferential Tariff, in accordance with the 1998-2003 schedule indicated in the annex. These preferential tariffs apply to ASEAN Member States once they implement their tariff reduction schedules on those specified articles.
Section 2 provides that if the Philippine MFN rate of duty on any listed article is reduced to a rate lower than the CEPT rates prescribed, the lower rate will automatically apply to that article.
According to Section 3, Margins of Preference under ASEAN Preferential Trading Arrangements will no longer be extended to the products listed in Annex 'A'.
As stated in Section 4, the prescribed rates of duty shall apply from the date of effectivity of the order for all listed articles entered or withdrawn from warehouses for consumption in the Philippines, subject to qualification under the Rules of Origin provided in the CEPT Agreement.
The Rules of Origin are criteria set out in the CEPT Scheme Agreement that determine whether an imported product qualifies for preferential tariff treatment under AFTA. Only products meeting these criteria are entitled to the reduced duty rates.
Section 5 repeals, amends, or modifies all decrees, orders, issuances, or regulations inconsistent with Executive Order No. 487 to ensure harmonized implementation of the revised tariff rates and schedules.
The CEPT is a tariff scheme that facilitates the reduction of tariffs among ASEAN member countries, promoting free trade within the ASEAN Free Trade Area (AFTA). The order implements CEPT tariff reductions for specified products on the Philippine side.