Law Summary
Memorandum of Agreement Among LTO, IC, and BIR
- LTO entered into a Memorandum of Agreement (MOA) with IC and BIR dated January 20, 2010.
- The MOA facilitates the use of the Insurance Commission Certificate of Cover Gateway (ICG) and the Enhanced Certificate of Cover Verification Facility (ECOCVF).
- These systems are designed for real-time and online authentication and verification of Certificates of Cover (COCs) for:
- Compulsory Third Party Liability (CTPL) insurance
- Comprehensive motor vehicle insurance policies
Certificate of Cover Gateway (ICG) Functions
- The ICG is designated as the sole electronic portal for recording all COCs as proof of insurance coverage under CTPL and Comprehensive Insurance.
Enhanced Certificate of Cover Verification Facility (ECOCVF) Functions
- The ECOCVF serves as the exclusive facility for:
- Verification of COCs representing valid insurance coverage.
- Collection of related taxes under CTPL and Comprehensive Insurance policies during motor vehicle registration.
Duties and Sanctions for Accredited Insurance Companies
- The IC mandates accredited insurance companies to submit and file their COCs related to CTPL and Comprehensive Insurance policies through the ICG.
- Administrative sanctions can be imposed by the IC on insurance companies and their directors, officers, or agents for any willful failure or refusal to comply with the filing requirement.
LTO Responsibilities
- LTO is tasked with hosting, managing, and maintaining the ECOCVF system.
- LTO must ensure seamless interconnection between the ECOCVF and ICG to facilitate proper monitoring and collection of taxes, fees, and related charges due to the BIR.
Effective Implementation and Systems Replacement
- Effective February 16, 2010, only insurance policies recorded in the ICG and verified through the ECOCVF will be accepted for LTO transactions.
- The ICG and ECOCVF officially replace the previously used Certificate of Cover Verification Facility (COCVF) and COCVF System A.
Publication and Compliance
- The MOA was nationally published through BIR Revenue Memorandum Circular No. 7-2010 dated January 20, 2010.
- Full adherence to this MOA is mandated for all concerned parties, ensuring:
- Valid insurance coverage
- Proper tax payments
- Accurate and real-time verification of certificates
Legal Authority
- The circular was adopted on February 10, 2010, and signed by Assistant Secretary Arturo C. Lomibao, emphasizing strict compliance by involved government agencies and private entities.