Purpose, governing coverage, core entities
- The Order establishes rules and regulations governing the transactions of customs brokers, customs brokerage firms, and attorneys-in-fact in the Bureau of Customs.
- It governs the issuance, suspension, and revocation of annual licenses for customs brokers and brokerage firms.
- It regulates the general transaction of business of customs brokers and brokerage firms in customs matters requiring their services.
- It prescribes uniform supervisory procedures over attorneys-in-fact before a special power of attorney may be issued in favor of a person who is not a customs broker (Rule 15).
Who may engage in customs brokerage business
- Any person, partnership, or corporation duly licensed by the Bureau of Customs may engage in customs brokerage business.
- Licensed brokers may transact a general customs brokerage business on behalf of others in connection with importation or exportation of articles, goods, wares, and merchandise.
- Licensed brokers may likewise handle other Customs matters necessitating their services.
- Engagement in customs brokerage business is limited to those with the required BOC license under the Order (Rule 1).
Annual license validity and renewal
- A customs broker’s license is valid only for one (1) year from the date of issuance (Rule 2).
- A license may be renewed annually by the Collector of Customs of the port where the applicant desires to establish a customs business (Rule 2).
- Renewal requires a written application and compliance with the specific documentary requirements for renewal (Rule 2).
- Failure to submit required renewal documents within the prescribed deadline results in automatic cancellation or revocation of the license (Rule 4).
License issuance: natural person requirements
- For a natural person applicant, renewal/issuance compliance requires:
- A valid professional license issued by the Professional Regulations Commission (Rule 2(A)(1)).
- A sworn statement of assets and liabilities showing sound financial standing, attested by a reputable Certified Public Accountant or accounting firm (Rule 2(A)(2)).
- A list of employees authorized to represent the licensee in the Bureau of Customs with:
- latest 2x2 photograph, addresses, positions, specimen signatures, SSS Number, and Taxpayer’s Identification Number (TIN) (Rule 2(A)(3)).
- A continuing Fidelity or Surety Bond of not less than THIRTY THOUSAND PESOS (P30,000.00), with authority for the Collector to increase the amount if found inadequate to answer for:
- damages the Government may suffer from acts or omissions by the broker or employees, and
- unpaid financial obligations or liabilities the broker personally assumed and failed to settle under commitments with the Bureau of Customs (Rule 2(A)(4)).
- A certified copy of the Privileged Tax Receipt for the current year, submitted not later than 31st of January of every year (Rule 2(A)(5)).
- Non-compliance with any enumerated natural-person requirements constitutes a valid ground for non-issuance and/or automatic cancellation or revocation of the license (Rule 2(B)(6)).
License issuance: juridical person requirements
- For a juridical person (partnership/corporation), renewal/issuance compliance requires:
- Certified true copies of the Articles of Incorporation and By-Laws or Articles of Partnership registered with the Securities and Exchange Commission, and at least two (2) officers licensed customs brokers must be stockholders (corporation) or general partners (partnership) (Rule 2(B)(1)).
- A sworn statement of assets and liabilities of the firm showing sound financial standing, attested by a reputable Certified Public Accountant or accounting firm (Rule 2(B)(2)).
- Valid professional licenses issued by the Professional Regulations Commission to the two (2) customs broker officers required by Section 3401 of the TCCP, with one designated as “Principal” and the other as “Alternate”.
- The Alternate broker signs in the absence of the Principal broker (Rule 2(B)(3)).
- No individual broker may represent more than one (1) licensed customs brokerage firm (Rule 2(B)(3)).
- A list of employees authorized to represent the licensee in the Bureau of Customs with latest 2x2 photograph, addresses, positions, specimen signatures, SSS Number, and TIN (Rule 2(B)(4)).
- A continuing Fidelity or Surety Bond of not less than FIFTY THOUSAND PESOS (P50,000.00), with authority for the Collector to increase if inadequate to answer for Government damages and unpaid financial obligations or liabilities assumed by the firm under commitments with the Bureau of Customs (Rule 2(B)(5)).
- Certified copies of the firm’s Privileged Tax Receipt and those of the two (2) licensed brokers who represent it, corresponding to the period for which the license is issued (Rule 2(B)(6)).
- Failure to submit or comply with any juridical-person requirements constitutes a valid ground for non-issuance and/or automatic cancellation or revocation of the license (Rule 2(B)(6)).
Numbering, documentary stamp, license forms
- Original annual licenses must be consecutively numbered and issued only upon compliance with the Order’s requirements by affixing a ONE HUNDRED PESOS (P100.00) documentary stamp required under Section 3301 (r) of the TCCP, and the seal of the Bureau of Customs (Rule 3).
- The license forms authorize operation at a designated port and specify a calendar period ending December 31.
- The Collector issues licenses in written form for an individual customs broker using the “CUSTOM’S BROKER’S LICENSE” format with authorization to conduct a general customs brokerage business at the Port of Manila (Rule 3(A)).
- The Collector issues licenses for a customs brokerage firm using the “CUSTOMS BROKERAGE LICENSE” format with authorization to conduct a General Customs Brokerage business at the Port of Manila (Rule 3(B)).
- Licenses may be revoked or suspended at any time by the Collector of Customs for cause (Rule 3(A) and Rule 3(B)).
Renewal filing deadlines and required documents
- Renewal applications must be filed under oath with the Office of the District Collector concerned not later than December 31 of each calendar year (Rule 4).
- Renewal applications must state that the applicant possesses all qualifications, has none of the disqualifications, and has complied with all requirements in the Order (Rule 4).
- Renewal issuance is conditioned on submission of:
- Clearance from the Law Division and Collection Division that the customs broker or brokerage firm has no pending financial obligation or liability to the Bureau of Customs as of the time of application (Rule 4(A)).
- A Fidelity or Surety Bond in the amount stated in Rule 2(A)(4) or Rule 2(B)(5), together with a Certificate of Premium Payment (Rule 4(B)).
- Amendments, if any, to governing corporate/partnership documents registered with the SEC (Rule 4(C)).
- Confirmation under oath of the list of employees (Rule 4(D)).
- Latest statement of net worth duly certified by a Certified Public Accountant or accounting firm (Rule 4(E)).
- Certified copy of the applicant’s Privileged Tax Receipt of the current year (Rule 4(F)).
- Mayor’s permit for corporation and partnership (Rule 4(G)).
- Certified list of clients (Rule 4(H)).
- All documents under Rule 4 must be submitted not later than January 31 of the year covering the renewal period; failure causes automatic cancellation or revocation (Rule 4).
Renewal license form and conditions
- A renewal of annual license is issued only upon compliance with the renewal requirements (Rule 5).
- Renewal licenses use the same forms and contents as Rule 3, but with the word “RENEWAL” and a required ONE HUNDRED PESOS (P100.00) documentary stamp affixed (Rule 5).
- Renewal of an annual license does not proceed if the license was suspended or revoked as prescribed by the Order (Rule 6).
Effects of suspension and prohibited renewal issuance
- No renewal of license is issued to any individual customs broker or brokerage firm whose license has been suspended or revoked by the Collector of Customs, or whose individual customs broker certificate has been suspended or revoked by the Professional Regulations Commission pursuant to Section 3407 of the TCCP (Rule 6).
- No license is issued to a customs broker or brokerage firm whose license is suspended or revoked by another Collector of Customs during the period of suspension or revocation (Rule 6).
Preventive suspension and reinstatement timeline
- The Collector of Customs places a customs broker or brokerage firm under preventive suspension upon a showing of a prima facie case of violations of:
- the Tariff and Customs Code of the Philippines,
- the Code of Ethics for Customs Broker,
- the rules and regulations prescribed in the Order, or
- other related laws, rules and regulations promulgated by competent authority (Rule 7).
- Preventive suspension is immediately imposed for ninety (90) days, pending formal hearing of the case (Rule 7).
- If the formal hearing or investigation is not finally terminated or decided within ninety (90) days from suspension, the license automatically reinstates (Rule 7).
- The period of delay is excluded from computing the preventive suspension period when the delay is due to the broker’s or brokerage firm’s fault, negligence or petition (Rule 7).
Causes for suspension or revocation
- The following acts and omissions are sufficient cause for suspension or revocation:
- Deliberate refusal without justifiable reason to perform duties of a licensed customs broker or brokerage firm when such refusal would prejudice the Government’s interests or clients’ interests (Rule 8).
- “Justifiable reason” is interpreted as acts that render the broker administratively and/or criminally liable under existing laws, rules and regulations (Rule 8).
- Misappropriation of client funds entrusted for payment of customs duties, taxes, charges, and other fees owed to the Government (Rule 8).
- Willful misdeclaration or undervaluation of imported or exported goods that resulted or would have resulted in loss of Government revenue, or in evasion of government control regulations (Rule 8).
- Knowingly filing entries for non-existing or fictitious persons/entities or those using fictitious names or phoney addresses (Rule 8).
- Knowingly using supporting documents found to be spurious, fake, falsified, or otherwise tampered (Rule 8).
- Lack of control and proper supervision over authorized employees representing the broker in customs transactions (Rule 8).
- Willful and deliberate violations of the Tariff and Customs Code or related rules and regulations, especially the Customs Administrative Order establishing a uniform rate charged by licensed customs brokers for their services (Rule 8).
- Violation of the Code of Ethics for Customs Brokers, adopted and recommended by the Board of Examiners for Customs Brokers and approved by the Commissioner of Civil Service on April 15, 1958 (Rule 8).
- Continued neglect of duty or incompetency (Rule 8).
- Failure to report to the District Collector of Customs any fraud upon customs revenue that comes to the broker’s knowledge, or knowingly assisting or abetting importation or exportation of an article (Rule 8).
PRC reporting, decision copies, complaints
- The Collector of Customs concerned must immediately submit a report to the Professional Regulations Commission on suspension, with a brief statement of pertinent facts and reasons (Rule 9).
- After the case terminates, the Professional Regulations Commission must be furnished a copy of the decision (Rule 9).
- If the decision is adverse to the respondent broker, the Collector of Customs must file a formal complaint with the Commission for whatever action the Commission may take (Rule 9).
Appeals, filing periods, and non-stay rule
- A decision by the Collector imposing a penalty exceeding one (1) month suspension may be appealed to the Commissioner of Customs within fifteen (15) days from receipt of the decision (Rule 10).
- The appeal may thereafter be brought to the Secretary of Finance within the same fifteen (15) days from receipt of the Commissioner’s decision (Rule 10).
- Suspension or revocation of the broker’s license is not stayed during pendency of the appeal with the Commissioner or the Secretary of Finance unless the latter directs otherwise (Rule 10).
- The appeal must state:
- the date the respondent received the decision,
- and if a motion for reconsideration was filed, the date it was filed and the date the respondent received the resolution (Rule 10).
- Failure to state those dates may cause dismissal of the appeal (Rule 10).
- The appellant must distinctly state the grounds of the appeal and the arguments supporting them (Rule 10).
Employee qualifications and authorized representatives
- Employees (“personeros”) authorized by customs brokers or brokerage firms to represent them in the Bureau of Customs must qualify and comply with the requirements (Rule 11).
- Employees must be:
- Filipino citizens,
- of good moral character (Rule 11).
- Employees must have completed a training program or seminar with a Certificate of Attendance issued by a Customs Brokers Association duly accredited by the Professional Regulations Commission.
- The accredited association must conduct such seminars at least once a year to accommodate applicants for employment (Rule 11).
- Employees must present NBI Clearances at the beginning of employment until the necessity arises for a new clearance (Rule 11).
Employee discipline, entry bar, and delinquency grounds
- Customs brokers and brokerage firms’ employees may be barred from entering customs premises and/or transacting with the Bureau of Customs for:
- disorderly conduct,
- acts prejudicial to the interest of the Government, or
- habitual delinquency in cases of violation of Bureau rules and regulations (Rule 12).
Notice of employee separation and authority termination
- Customs brokers and brokerage firms must immediately notify the Bureau of Customs through the Office of the Collector of the Port where they are licensed whenever:
- an employee or representative ceases to be employed, or
- the representative’s authority is terminated (Rule 13).
- The notice must be written and must state:
- the name of the employee or representative,
- the effective date of termination,
- and the number of the Customs Pass issued, if any (Rule 13).
Additional requirements and industry comment
- Collectors of Customs may recommend to the Commissioner of Customs additional requirements, deletions, or amendments to requirements in the Order.
- Copies of recommendations must be furnished to the Customs Brokerage Association duly accredited by the Professional Regulations Commission for comment before approval or denial (Rule 14).
Supervisory authority over attorneys-in-fact
- Uniform procedure controls supervisory authority over attorneys-in-fact before a special power of attorney may be issued to a person who is not a customs broker (Rule 15).
- A special power of attorney must specify, among others:
- the name of the consignee,
- the bill of lading or airway bill number,
- the date of arrival,
- the voyage or flight number, and
- the registry number (Rule 15(A)).
- The special power of attorney must state that the commission to the agent or attorney-in-fact is limited to the shipment described (Rule 15(B)).
- If issued by a corporation or regular importer or other entity to a person not otherwise a customs broker, it must be accompanied by a certificate of employment under oath stating the agent/attorney-in-fact is a full-time employee or official receiving fixed compensation (Rule 15(C)).
- The law division in the collection district (or equivalent unit in subports) evaluates the sufficiency of the special power of attorney in form and substance and maintains a logbook registering the special power of attorney (Rule 15(D)).
Repeal, modification, and effectivity mechanics
- Any contrary Customs Administrative Order, memoranda, orders, or other issuances are deemed repealed or modified accordingly (Rule 16).
- The Order’s effectivity is tied to approval by the Secretary of Finance and thirty (30) days publication in a newspaper of general circulation in the Philippines (Rule 17).