FTA PORTAL - Import case

Process of FTA utilization when importing

To utilize FTAs when importing to the Philippines, the following sequential procedures are necessary.

Step 1

Effective FTA

To utilize an FTA when importing, it is necessary to verify that FTA has been signed and is in effect between the Philippines and the exporting country.
The countries with effective FTAs can be checked below.

Overview of Status (FTA)

Step 2

Item Classification

Harmonized System code — Since FTA tariff rates are determined by the HS Code, accurately identifying the HS Code is essential.

Import — For imported goods, it is necessary to consult with experts such as customs brokers or apply for an advance ruling on tariff classification from the Tariff Commission to confirm the HS Code.

When it's difficult to classify an HS code, you can refer to the following.

Advanced Ruling of Tariff Commission

+ 632 8465 3300 loc 102 and 104

Step 3

Tariff Benefit

After finding the item number of the imported goods, it is necessary to check whether there are FTA tariff benefits in Philippines.

[Tariff Benefit: (Philippines's MFN Rate - FTA Rate) x Import Value (CIF)]

You can confirm whether there is a tariff benefit to receive a certificate of origin through the following path

Step 4

Obtain FTA Certificate of Origin

Applying FTA tariff rates upon importation is only possible when a valid FTA certificate is received from the exporter.
It is necessary to verify in advance whether exporters are aware of the FTA agreement forms,
as only certificates of origin issued in accordance with the methods stipulated in each agreement are valid for application.
The issuance method of the Certificate of Origin varies according to each agreement as below.

Form D / E-Form D

ATIGA (ASEAN Trade in Goods Agreement)

Method of Issuance: Issued by the authority

Validity Period: 12 months

Retroactive Issuance: 1 year from date of shipment

Form E

ACFTA (ASEAN-China Free Trade Area)

Method of Issuance: Issued by the authority

Validity Period: 1 Year

Retroactive Issuance: 12 months from shipment

Form AK

Form AKFTA (ASEAN-Korea Free Trade Agreement)

Method of Issuance: Issued by the authority

Validity Period: 1 Year

Retroactive Issuance: 1 year from date of shipment

Form AI

AIFTA (ASEAN-India Free Trade Area)

Method of Issuance: Issued by the authority

Validity Period: 12 months

Retroactive Issuance: 12 months from shipment

Form AJ

AJCEP (ASEAN-Japan Comprehensive Economic Partnership)

Method of Issuance: Issued by the authority

Validity Period: 1 Year

Retroactive Issuance: 1 year from date of shipment

Form PJ

PJEPA (Philippines-Japan Economic Partnership Agreement)

Method of Issuance: Issued by the authority

Validity Period: 6 months

Retroactive Issuance: -

Invoice

PH-EFTA (Philippines-European Free Trade Association)

Method of Issuance: Self-issuance

Validity Period: 12 months

Retroactive Issuance: -

Form AHK

AHFTA (ASEAN-Hong Kong, China Free Trade Agreement)

Method of Issuance: Issued by the authority

Validity Period: 1 year

Retroactive Issuance: 1 year from date of shipment

Form AANZFTA

AANZFTA (ASEAN-Australia-New Zealand Free Trade Agreement)

Method of Issuance: Self-issuance

Validity Period: 12 months

Retroactive Issuance: 12 months from date of exportation

Form RCEP

RCEP (Regional Comprehensive Economic Partnership)

Method of Issuance: Issued by the authority Self-issuance (Not in effect)

Validity Period: 1 year

Retroactive Issuance: 1 year from date of shipment

Step 5

Apply for FTA tariff rate

Apply for FTA tariff rate to receive FTA tariff rates, importers must submit an import entry to apply FTA tariff rate When making an import declaration,
application for preferential tariff treatment can be made before or after customs clearance.
In case of post application of FTA, customs drawback can be made by importers within 1 year of the importation.

Process for preferential tariff treatment of pre-clearance

Exproter, Importer, Customs Office Flowchart — Exporter Prepare for FTA Certificate of origin Importer Receive FTA Certificate of origin Check validity of Certificate of Origin Apply import entry Prepare for FTA Certificate of origin Customs Office Review import entry Approve import entry

Process of preferential tariff treatment of post-clearance

Step 6

Maintain data keeping requirement

3Years — Records Keeping Period

Importers are required to keep all records for a period of 3 years from
the date of final payment of duties and taxes or customs clearance by
below regulation.

Supporting Provision : Requirement to Keep Records

(Sec. 1003, An act modernizing the customs and tariff administration)

Term of Importer

(1) Importer-of-record or consignee, owner or declarant, or a party who :

(i) Imports goods into the Philippines or withdraws such goods into the Philippine customs territory for consumption or warehousing; files a claim for refund or drawback; or transports or stores such goods carried or held under security; or

(ii) Knowingly causes the importation or transportation or storage of imported goods referred to above, or the filing of refund or drawback claim.

(2) An agent of any party described in paragraph (1)or(3) A person whose activities require the filing of a goods declaration.

* A person ordering imported goods from a local importer or supplier in a domestic transaction shall be exempted from the requirements imposed by this section unless:

1 The terms and conditions of the importation are controlled by the person placing the order; or
2 The circumstances and nature of the relationship between the person placing the order and the importer or supplier are such that the former may be considered as the beneficial or true owner of the imported goods; or
3 The person placing the order had prior knowledge that they will be used in the manufacture or production of the imported goods.

Penalty: Failure to keep the records required by this Act shall constitute a waiver of this right to contest the results of the audit based on records kept by the Bureau.

Import case