EXECUTIVE ORDER NO. 898

Law Summary

Background and Purpose

Legal Principle: Executive Order (EO) No. 898 aims to modify the nomenclature and import duty rates on certain iron and steel products to support the local industry and housing sector.
Context: This EO is a response to the inadequate domestic production of hot-rolled coils (HRC) and cold-rolled coils (CRC), which are essential in manufacturing roofing materials and other construction products.
Regulatory Basis: The EO is grounded in the Tariff and Customs Code of 1978 (Presidential Decree No. 1464), specifically Section 401, which grants the President authority to adjust import duties.

Section 1: Import Duty Rates

Provision: Articles listed in the accompanying Annex will be subject to the Most-Favoured-Nation (MFN) rate of import duty as specified.
Key Definitions:
- Most-Favoured-Nation (MFN) Rate: A standard rate of duty applied to internationally traded goods, ensuring non-discriminatory trade practices.
Important Details:
- Specific articles are mentioned in the Annex.
- Duty rates vary by article and are detailed in the schedule.

Section 2: Existing Tariff Rates

Provision: Tariff headings and subheadings not included in the Annex will retain their current duty rates.
Important Details:
- This ensures stability in duty rates for non-listed items, preventing sudden financial impacts on importers.

Section 3: Effectivity of Duty Rates

Provision: Upon the order’s effectivity, all listed articles that are imported and withdrawn for consumption will be levied the MFN rates as indicated.
Timeframes:
- The EO becomes effective 15 days after publication in the Official Gazette or a newspaper of general circulation.

Section 4: Reversion of Duty Rates

Provision: The import duty rates for the listed articles will revert to a 7% MFN tariff rate once domestic production of HRC and CRC is sustained.
Requirements:
- Determination of sustained production must be approved by the Board of Investments and the Committee on Tariff and Related Matters.

Section 5: Revocation of Inconsistent Regulations

Provision: Any prior presidential issuances or regulations that conflict with this EO are revoked or modified.
Important Details:
- This clause ensures that EO No. 898 is the prevailing regulation for the import duties on affected iron and steel products.

Section 6: Publication and Effectivity

Provision: The EO will take effect fifteen (15) days after its complete publication.
Timeframes:
- Immediate applicability post-publication emphasizes the urgency of the measures to support the domestic industry.

Key Takeaways

Objective: EO No. 898 modifies import duties to foster local iron and steel production and support the housing sector.
Implementation: New MFN rates apply to specified products, while existing rates remain for non-listed items.
Reversion Mechanism: There is a structured approach to revert to original rates upon meeting domestic production targets.
Regulatory Clarity: The EO clarifies the legal standing of conflicting regulations, ensuring streamlined enforcement of new duties.

This summary encapsulates the essential elements of Executive Order No. 898, providing a structured overview of its provisions and implications for the iron and steel industry in the Philippines.