Tariff adjustments per ASEAN-Hong Kong FTA

Executive Order No. 102 is issued under the President’s authority under the Constitution and existing laws.
RA No. 10863 (Customs Modernization and Tariff Act)—specifically Section 1609—authorizes the President, upon recommendation of NEDA, to modify import duties, including classification and other restrictions, to carry out and promote foreign trade.
The AHKFTA was signed on December 12, 2017, with signature completion by ASEAN member states on March 28, 2018.
The AHKFTA was ratified on January 4, 2019.
The NEDA Board approved on May 6, 2019 (ad referendum) the tariff reduction schedule for products covered by the Philippine Schedule of Tariff Commitments under the AHKFTA.

Executive Order No. 102 implements the AHKFTA rule that each Party shall progressively reduce or eliminate customs duties on goods originating from the other Parties.
Tariff reduction and duty elimination under the AHKFTA are intended to strengthen economic partnerships and support sustainable economic development among ASEAN member states and Hong Kong, China.
The Order is designed to enhance trade and investment between the Parties through tariff commitment implementation.
The tariff changes operate through the Philippines’ Schedule of Tariff Commitments, as reflected in an attached Annex.

Section 1 makes the Philippine Schedule of Tariff Commitments under the AHKFTA controlling for the duty rates.
The tariff-adjusted articles are those listed in the Philippine Schedule of Tariff Commitments.
The applicable rates are those shown in columns 3 to 16 of the Schedule (as indicated in the Order’s attachment/Annex).
The Order subjects each listed article to the specific rates of import duty indicated in the relevant Schedule columns.

Section 2 applies to all goods originating from Hong Kong, China and ASEAN Member States.
The duty rates prescribed in the Schedule apply to goods entered into or withdrawn from warehouses in the Philippines for consumption.
The applicable tariff rate system is conditioned on submission of a Certificate of Origin.
The Certificate of Origin must comply with the Rules of Origin under the AHKFTA.
The Order requires that the tariff rates applied be the rates of duties prescribed in the Philippine Schedule for the relevant goods and origin.

Section 2 authorizes the Tariff Commission to be requested to issue advance rulings on tariff classification.
Advance rulings are to confirm the applicable rates of duty for particular goods covered by the Order.
Advance rulings are issued consistent with Section 1100 of RA No. 10863.

Section 3 preserves the Philippines’ ability to invoke trade remedy measures under its laws.
The government’s recourse also extends to trade remedy measures provided under the AHKFTA.
The preserved right includes recourse under other relevant international agreements.
The recourse is expressly aimed at preventing import surges or unfair trade practices.

Section 4 repeals or amends all prior issuances inconsistent with Executive Order No. 102.
Section 5 contains a separability clause: if any provision or part of the Order is declared invalid, illegal, or unconstitutional, the remaining provisions remain in force.
The continuing effect of unaffected provisions is guaranteed by Section 5.