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The Bureau of Customs is prescribing rules for the uniform treatment on the conditional importation of international cable-laying and repair vessels in all ports of entry
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A draft customs administrative order providing rules on the temporary admission of ICLRVs is being finalized and BOC is requesting stakeholders to submit their position papers on the proposed rules until March 4
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The draft CAO will cover all foreign-owned and foreign-registered ICLRVs temporarily admitted for the survey, installation, maintenance, upgrading, or repair of submarine cables, or for seabed cable-support activities undertaken to support, among others, ICT infrastructure or offshore energy-generation systems
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ICLRVs admitted under conditional importation or temporary admission are exempt from duties and taxes subject to compliance with several conditions and documentary requirements
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A cash bond or other acceptable form of security will be required to ensure compliance with the conditions of temporary admission
The Bureau of Customs (BOC) is prescribing rules for the uniform treatment on the conditional importation of international cable-laying and repair vessels (ICLRVs) in all ports of entry.
A draft customs administrative order (CAO) providing rules on the temporary admission of ICLRVs is being finalized and BOC is requesting stakeholders to submit their position papers on the proposed rules until March 4.
The draft CAO will cover all foreign-owned and foreign-registered ICLRVs temporarily admitted for the survey, installation, maintenance, upgrading, or repair of submarine cables, or for seabed cable-support activities undertaken to support, among others, information and communications technology (ICT) infrastructure or offshore energy-generation systems.
The CAO is consistent with relevant sections of Republic Act No. 10863, or the Customs Modernization and Tariff Act (CMTA), and Annex B.2. of the 1990 Convention on Temporary Admission (Istanbul Convention).
Under the CMTA, conditional importation refers to the customs procedure known under the Revised Kyoto Convention as temporary admission in which certain goods can be brought into a customs territory conditionally relieved, totally or partially, from payment of import duties and taxes.
Such goods must be imported for a specific purpose and must be intended for re-exportation within a specified period and without having undergone any substantial change except due to normal depreciation.
The Istanbul Convention, meanwhile, is a World Customs Organization treaty that harmonizes procedures for importing goods temporarily without paying duties or taxes.
The draft CMO noted that the Philippines acceded to Annex B.2. of the Istanbul Convention, which grants temporary admission to professional equipment without reservation.
ICLRVs are specially designed vessels, permanently fitted with the technical systems required for the survey, installation, maintenance, or repair of submarine fiber-optic and power cables, including seabed cable-support activities undertaken to support, among others, ICT infrastructure or offshore energy generation systems.
ICLRVs admitted under the system of conditional importation or temporary admission are to be exempt from duties and taxes subject to compliance with several conditions and documentary requirements.
Conditions include: vessel must be owned and is imported by a person established or resident outside the Philippines, and will be used solely by or under the personal supervision of the person visiting the Philippines.
A goods declaration for conditional importation should be filed in accordance with Section 401 of the CMTA. Pending the adjustment of BOC’s Electronic-to-Mobile (E2M) System to accommodate temporary admission, the filing of goods declarations under the informal entry process will be allowed.
The goods declaration should be accompanied by supporting documents, such as the special permit from the Maritime Industry Authority, a charter agreement, service contract, or any equivalent document establishing the contractual basis of the engagement with the foreign vessel owner; and a re-exportation undertaking, among others.
A cash bond or other acceptable form of security will be required to ensure compliance with the conditions of temporary admission. A mere written commitment to reexport will not be deemed sufficient.
The concerned BOC collection district will monitor the activities of ICLRVs admitted under the proposed CAO to verify their exclusive use for survey, cable-laying, or repair operations and to ensure that the vessels remain identifiable and traceable throughout their stay in Philippine waters.
Upon completion of the authorized project, the vessel should be reexported within the prescribed period.
An authorized project may cover multiple customs jurisdictions or collection districts where survey, installation, maintenance, upgrading, or repair of submarine cables or seabed cable support activities are required. The project authorization should specify the ports covered, the routing plan, the scope of work, and the approximate duration of the activities in each port.
Any cable, pipe, or other material to be laid, installed, or otherwise used for the approved project in the Philippine territory, and not forming an integral and permanent part of the ICLRV, will be subject to importation requirements under the CMTA, including applicable duties and taxes, unless otherwise exempt by law, and submission of appropriate clearances or permits if the goods are regulated.
Any violation of the provisions of the proposed CAO will subject the vessel to the applicable penalties under the CMTA, including the payment of duties, taxes, and other charges. This is without prejudice to the institution of other remedies available under the CMTA and customs rules and regulations.— Roumina Pablo
