QuestionsQuestions (BSP CIRCULAR NO. 1348)
As a general rule, all kinds of merchandise imports are allowed. However, certain commodities may be regulated or prohibited for reasons of public health and safety, national security, international commitments, and development/rationalization of local industry.
Freely importable commodities are those whose importation is neither regulated nor prohibited under Sections 3 and 4. They may be effected without prior approval or clearance from any government agency.
Regulated commodities require clearances/permits from appropriate government agencies (including the Central Bank where applicable). Prohibited commodities are not allowed under existing laws (e.g., those listed in Tariff and Customs Code Section 101; certain items expressly prohibited under R.A. or LOI).
Examples include: (1) Acetic anhydride — Dangerous Drugs Board (DDB); (2) Fish and fish preparations — BFAR; (3) Rice and corn — National Food Authority. (Other examples include firearms—PNP-FEO; pesticides—Fertilizer & Pesticide Authority; refined petroleum products—Energy Regulatory Board).
Prohibited commodities are those whose importation is not allowed under existing laws. Examples in the text include: onions/potatoes/garlic/cabbages except for seedling purposes (R.A. 1296); coffee (R.A. 2712); used clothing and rags (R.A. 4653); and toy guns (LOI 1264).
Letter of Credit (L/C), Documents Against Payment (D/P), Documents Against Acceptance (D/A), and Open Account (O/A).
All L/Cs must be opened on or before the date of shipment, and only one L/C should be opened for each import transaction.
The requirement of pre-shipment inspection/Clean Report of Findings (CRF) must be strictly observed.
D/P releases shipping documents to the importer only upon receipt of payment. D/A releases documents upon the importer’s written acceptance of the seller’s bill of exchange, obligating payment at a future date.
Export producers/manufacturers, oil firms, and franchised public utility concerns, without prior CB approval.
D/A and O/A imports must be registered with the Central Bank. Payments cannot be effected for unregistered D/A/O/A imports. Payments prior to maturity may be allowed if already registered; extensions are allowed if reported and within limits (cumulative length not exceeding 360 days). Beyond 360 days requires CB approval.
CISS subjects goods destined for importation into the Philippines to inspection by duly authorized government inspectors in the countries of supply for quality, quantity, price/HCV, and classification/verification for tariff and customs code purposes.
(1) Goods sold/supplied from all countries with FOB value of US$500 and above; and (2) goods invoiced or declared as off-quality using terms like stocklots, seconds, scraps, reconditioned, used, or similar terms conveying non-first quality regardless of value.
CBRC stands for Central Bank Release Certificate. Imports subject to CBRC are (a) imports under D/A and O/A arrangements; and (b) imports of regulated items specified under Section 3 regardless of mode of payment.
For every export shipment involving foreign exchange proceeds, exporters must accomplish the required Export Declaration (ED). For ASEAN country exports, the ED is required even if the shipment is paid in Philippine pesos.
The full invoice value of the export shipment must be inwardly remitted within 180 days from the date of shipment, and the proceeds must be sold for pesos to an AAB within three (3) business days from receipt (subject to the 40% deposit allowance in an SFCDA if conditions are met).
Constructive exports include gold sales to CB; sales to bonded manufacturing warehouses/export zones/BOI-registered bonded trading warehouses/diplomatic missions paid in foreign currency; and sales to Duty Free Philippines (DFP) paid in foreign currency. For constructive exports under Section 44(b), the exporter must accomplish an ED for each sale, submitting a delivery receipt signed by buyer in lieu of bill of lading/air waybill.