Scope and Classification of Vehicles
- Covers duty-free and tax-exempt admission of self-propelled land transportation vehicles.
- Classified into:
- Utility-Service/Special-Purpose Vehicles: for operational tasks like cargo and passenger transport.
- Tourist-Service Vehicles: for tourism-related passenger transport in industries such as hotels, resorts.
- Company-Service Vehicles: brand new vehicles used as service vehicles, with restrictions on luxury vehicle admission.
- Luxury vehicles limited to certain high-ranking officials on a one-to-one basis.
Eligibility and Criteria for Admission
- Applicants must be Locators with a valid Certificate of Registration and Tax Exemption (CRTE) and lease agreements of at least 3 years remaining.
- Zone Authority may approve or disapprove based on law and regulatory compliance.
- Investment requirement for Company-Service Vehicles: minimum US$600,000 investment per vehicle.
- Limits on maximum vehicles per category (Utility Vehicles: 10; Tourist Vehicles: 6; Company Vehicles: 6).
- Utility/Tourist vehicles require endorsement from Zone Authority's Business & Investment unit.
- Must have operated at least one year unless business nature justifies immediate admission.
Conditions and Limitations
- Privilege is non-transferable and granted only to registered Locators.
- Applicant must have no outstanding financial obligations or an approved payment scheme.
- Principal vehicle user must be identified with proof of necessity linked to the business activity.
- Admission Authority must be obtained prior to vehicle admission.
- Extensions/amendments allowed only within validity period.
- Vehicles must be registered with LTO under a special blue plate and with Zone Authority’s Motor Vehicle Registration unit.
- Usage restricted to inside Freeport Zones for 3 years; no sale/transfer/duties payment allowed during this period.
- Post 3-year, vehicles can be transferred to qualified Locators or sold with payment of duties/taxes, subject to conditions.
- Brand new vehicles defined by current or advanced year model; used vehicles must be sold to qualified Locators or re-exported.
Application Requirements
- Letter of Intent justifying vehicle admission.
- Completed application form with signed conditions agreement.
- Secretary’s certificate authorizing representative.
- Certified copies of CRTE and lease.
- Pro forma invoice or ownership documents.
- Zone Authority certification on investment and financial clearance.
- Notarized statement that vehicle has not been loaded/shipped yet.
- Certificate of inspection for previously requested vehicles.
Sale, Transfer, Assignment, and Duties
- Prohibited within 3 years from admission date without prior clearance.
- Post 3-year, possible transfers either duty-free to qualified Locators or with duties paid to any entity (depending on vehicle classification).
- Clearance from Zone Authority required before any sale, transfer, assignment or payment of duties.
Temporary Use Outside Freeport Zones
- Allowed up to 336 hours (14 days) per month.
- Extensions possible with prior written request and approval.
- Use of GPS or RFID technology mandated for monitoring compliance:
- GPS notifications only upon violation or equipment tampering.
- RFID tags incorporated in gate pass stickers; scanners at all gates.
- Future technologies may be adopted for effective monitoring.
Administrative Fees
- US$100 processing fee per vehicle for admission.
- Reduced fee of US$20 for green vehicles (environmentally friendly models).
- US$25 fee for annual LTO registration renewal clearance.
- US$100 fee for clearance related to sale, transfer, assignment, or duties payments.
Inventory and Inspection
- Vehicles subject to periodic/on-the-spot inspections.
- At least annual presentation for inspection as scheduled by Zone Authority.
Fines and Penalties
- Pre-approval loading/shipping: US$5,000 fine.
- Unauthorized sale/transfer without clearance: US$2,000 plus duties/taxes.
- Failure to present vehicle for inspection: US$1,000.
- Unauthorized use beyond permitted time outside Freeport:
- US$20/hour for first 10 hours over limit, US$25/hour thereafter.
- Smuggling presumption after 48 hours past limit; reported to BOC/LTO.
- Possible suspension/cancellation of CRTE and tax incentives.
- Other violations: fines US$500 up to forfeiture and suspension/cancellation of privileges depending on circumstances.
Coordination, Review, and Effectivity
- Continuous coordination with government agencies to facilitate document and permit processing.
- Guidelines subject to review and amendment by Subic-Clark Alliance for Development Council.
- Immediate effectivity upon adoption and signing in January 2011.