New rules out on advanced duty payments

MANILA, Philippines - The Bureau of Customs (BoC) has released the rules for the payment by importers of advanced duty deposit and final payables. Customs Memorandum Order No. 6-2009. dated last February 6, provides instructions for paying the required importation fees cleared through the e2m (electronic to mobile) Customs System, which was designed to speed up the release of cargoes by making the bureau’s services available on the Internet. The memorandum, issued by Customs Commissioner Napoleon L. Morales, also enumerated the guidelines on filing an Import Entry Declaration (IED) for the payment of advanced duty deposits as well as on the Single Administrative Document-Import Entry and Internal Revenue Document (SAD-IERD) for the final payment of duties, taxes and other charges. The memorandum states that, upon implementation of the third phase of the e2m Customs System in a Customs district or its sub-ports, the use of paper IED for advanced deposit payments to an Authorized Agent Bank (AAB) will be stopped, effective on the dates to be announced by the Customs Commissioner. The payment of the duties will instead be done through an electronic IED. The e2m Phase III, which has yet to be implemented, includes export automatic lodgment, liquidation of raw materials and bond management system. The Customs bureau, via its e2m system, will compute the final payment due on the importation, based on the details contained in the SAD-IEIRD and submitted to the Customs through an accredited Value-Added Service Provider (VASP). The e2m will then create final payment instruction and transmit it to the bank. "The bank system shall cause the debit of the amount stated in the final payment instruction from the nominated account, generate a Final Payment Confirmation and electronically transmit this to the BoC," Mr. Morales said in the memorandum. In order to pay the advanced duty deposit and to complete the filing of an electronic SAD-IERD, the declarant must log in to an authorized VASP and accomplish a customs declaration through the Internet. He will then type "IED" on box 1 of the SAD. On box no. 28 under Financial and Banking Data and opposite the label "Bank Ref. No.," he should type the authorized agent bank reference number assigned to the client for each registered bank account from where the advanced deposit of customs duty will be charged. The importer will then submit the form electronically to the e2m Customs System which would require him to affix his electronic signature. The service provider will provide the procedure for affixing an electronic signature. After validating the SAD-IERD, the e2m system sends an electronic payment instruction together with details of the SAD-IERD to the bank. The declarant will then print the forms for his file and will present it to the authorized banks for the opening of the letter of credit. The BoC will send to the service provider the advanced payment confirmation message it received. "A SAD-IERD may be used to pay declarations lodged at any Customs port, provided it will be used for the same shipment covered by the said SAD-IERD," the memorandum said. As regards the final payment of duties, taxes and fees, the declarant must log-in to an accredited service provider and accomplish a SAD online. On box number 28 of the SAD-IERD on Financial and Banking Data and opposite the label "Bank Ref. No." he should type the AAB reference number assigned to the client for the particular bank account from where the advanced duty deposit has been paid and from where the final payment will be debited. In the "Terms of Payment Section" under the SAD-IEIRD, the payer must supply the required details from the import entry declaration opened for the importation. Other non-cash payment instruments such as tax debit memos, to pay for the importation are likewise indicated in this section, the memorandum said. Once the required data had been supplied, the payer should submit it online to BoC’s e2m system, which would then ask him to affix his electronic signature. "In compliance with the records-keeping requirements of the BoC under existing laws, the declarant prints the SAD-IEIRD together with the Tax Assessment Notice after receipt of the payment confirmation message," the memorandum said. Launched in 2005, the e2m project is part of the P500-million Automated System for Customs Data being undertaken by the BoC. It involves a shift to paperless transactions in a bid to promote efficiency and to prevent fraud. Among its features is the client profiling whereby payers will be issued permanent client numbers and electronic signature for documents to be submitted to the system. Ports in Manila, Batangas, Clark, Cebu, and Davao are among those that have adopted the system. — A. D. B. Romero, BusinessWorld