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The Bureau of Customs has released guidelines on the issuance of proof of origin and grant of preferential tariff treatment under the Philippines-Korea Free Trade Agreement
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Customs Memorandum Order No. 11-2024 also provides the mechanism for registration of exporters, producers and manufacturers, and claiming for a preferential rate of duty
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Applications for evaluation of goods to be exported and certificate of origin will be handled by the Export Coordination Division, and the Export Division of ports outside Metro Manila or its equivalent unit
The Bureau of Customs (BOC) has released guidelines on the issuance of proof of origin and grant of preferential tariff treatment under the new Philippines-Korea Free Trade Agreement (PH-KR FTA).
Customs Memorandum Order (CMO) No. 11-2024 dated December 31 also provides the mechanism for registration of exporters, producers, and manufacturers, and claiming for a preferential rate of duty under the PH-KR FTA, which took effect on December 31, 2024.
READ: Marcos issues EO on Philippines-Korea free trade agreement
Under the CMO, BOC will only accept certificate of origin (CO), or Form PH-KR, and origin declaration issued by an approved exporter as proof of origin upon effectivity of the CMO.
In addition, the origin declaration by an exporter or producer should be implemented no later than 10 years after the date of entry into force of the FTA.
Proof of origin is a document that verifies the country where a product was manufactured. It can either be a CO or an origin declaration.
A CO is an international trade document attesting that goods in a particular export shipment are wholly obtained, produced, manufactured, or processed in a particular country. It is used to determine if a product qualifies for preferential treatment under the trade agreement.
An origin declaration, meanwhile, refers to the declaration on the originating status of goods that is completed by an approved exporter.
BOC’s Export Coordination Division (ECD), and the Export Division (ED) of ports outside Metro Manila or its equivalent unit, will carry out the proper examination of all applications for issuance of CO under the PH-KR FTA.
The ECD will also carry out proper examination of all applications for approved exporter status under the PH-KR FTA and will have the right to request additional supporting documentary evidence, as necessary.
The Preferential Rate Unit (PRU) or its equivalent units in all ports, meanwhile, will evaluate the authenticity, accuracy, and validity of the proof of origin submitted by importers accordingly.
The PRU or its equivalent units in all ports may request verification, through the ECD, when it has reasonable doubt on the authenticity and validity of the proof of origin or on the accuracy of the information regarding the origin of the goods.
The ECD will carry out verifications of the originating status of the goods upon request of the importing party. Verifications can be made based on documents requested from the exporter or producer or by verification visit at the exporter’s or producer’s premises.
Producers, traders, or their authorized representatives should apply to the ECD (for Metro Manila stakeholders) or ED of ports or its equivalent unit (for outside Metro Manila stakeholders) for an evaluation of goods to be exported with the intention of claiming preferential tariff treatment under the PH-RK FTA.
Applications should be submitted through BOC’s Portal (https://client.customs.gov.ph/) and upload all the required documents under CMO 11-2024. Hard copies of the documents must be submitted to BOC’s Customer Care Center (CCC) for processing of the application.
ECD, the ED, or its equivalent unit, should review the documents and act on the application within 21 working days from the date of receipt of complete documents.
Once the goods have been evaluated, a Product Evaluation Report (PER) will be issued to the applicant indicating the origin criteria to be used in their respective proof of origin application. However, if the goods do riot qualify as originating, the PER will state the reason/s for its disapproval.
On the issuance of CO, exporters, producers, or their authorized representatives should also apply to ECD, ED of ports outside Metro Manila or its equivalent unit, and submit the required documents through the BOC Portal and the CCC.
An exporter intending to be an approved exporter, meanwhile, should submit the required documents both in hard copy and in electronic portable document format (PDF) to the ECD through the CCC.
The PH-KR FTA was signed in September 2023 to further strengthen economic partnership and bilateral trade between the Philippines and Republic of Korea by reducing and eliminating tariff restrictions, encourage more foreign direct investments, and secure more preferential concessions than those currently available under existing agreements.
President Ferdinand Marcos, Jr. ratified the PH-KR FTA on May 13, 2024. The Philippine Senate concurred the ratification in September 2024 while South Korea’s National Assembly ratified the FTA in November 2024.
Under the FTA, South Korea and the Philippines will eliminate tariffs on 94.8% and 96.5% of products, respectively. – Roumina Pablo
