G/VAL/N/2/PHL/2  
 
31 May 2023  
(23-3719) Page: 1/4 
Committee on Customs Valuation  Original: English  
 
INFORMATION ON IMPLEMENTATION AND ADMINISTRATION  
OF THE AGREEMENT ON CUSTOMS VALUATION  
CHECK -LIST OF ISSUES  
PHILIPPINES  
The following communication, dated 26 May 2023, is being circulated at the request of the delegation 
of the Philippines . 
 
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1. Questions concerning Article 1:  
(a) Sales between related persons:  
(i) Are sales between related persons subject to special provisions?  
Yes, importers are required to submit a Supplemental Declaration on Valuation (SDV) 
for sales between related persons to determine whether the value closely 
approximates the transaction value in sales to unrelated buyers or the customs value 
of identical or similar goods und er Sections 704 and 705 of the Customs Modernization 
and Tariff Act (CMTA).  
 
CLARIFICATORY NOTE: The CMTA  repealed Republic Act (RA) No. 9135 which 
amended the Tariff and Customs Code of the Philippines (Presidential Decree 
No. 1464). RA No. 9135 incorporated the rules on Customs Valuation under the terms 
of the General Agreement on Tariffs and Trade (GATT) Agreement 1994.  
 
(ii) Is the fact of intercompany prices prima facie considered as grounds for 
regarding the respective prices as being influenced?  
No 
 
(iii)  What is the provision for giving the communication of the afore -mentioned 
grounds in writing if the importer so requests? (Article 1.2(a))  
Please refer to the last paragraph of Section 707 of the Republic Act No. 10863 and 
the first paragraph of Sectio n 706 of R.A. No. 10863.  
 
(iv) How has Article 1.2(b) been implemented?  
Please refer to the last paragraph of Section 701 of the CMTA.  
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  (b) Price of lost or damaged goods:  
 Are there any special provisions or practical arrangements concerning the 
valuation of lost or damaged goods?  
 
Yes, please refer to Sections 90 4 to 911  of the CMTA.  
 
2. How has the provision of Article 4 to allow the importer an opinion to reverse the 
order of application of Articles 5 and 6 been implemented?  
Please refer to the third paragraph  of Section 700 and first paragraph of Section 704 of R.A. 
No. 10863 and the third paragraph of Section 4.9.1. of CAO No. 9 -2020.  
 
3. How has Article 5.2 been implemented?  
Please refer to the last paragraph of Section 704 of R.A. No. 10863 and the last parag raph 
of Section 4.9.5 of CAO No. 09 -2020. 
 
4. How has Article 6.2 been implemented?  
Please refer to the last paragraph of Section 705 of R.A. No. 10863.  
 
5. Questions concerning Article 7:  
(a) What provisions have been made for making value determinations pursuant t o 
Article 7?  
The provisions are included in the first paragraph Section 706 of R.A. No. 10863 and 
Section  4.9.7 of CAO No. 9 -2020. 
 
(b) What is the provision for informing the importer of the customs value determined 
under Article 7?  
Please refer to the first paragraph Section 706 of R.A. No. 10863 and Section  4.9.7 of CAO 
No. 9 -2020. 
 
(c) Are the prohibitions found in Article 7.2 delineated?  
Yes. Please refer to the second paragraph Section 706 of R.A. No. 10863 and Section 4.9.7 
of CAO No. 9 -2020. 
 
6. How have the options found in Article 8.2 been handled? In the case of f.o.b. 
application, are ex -factory prices also accepted?  
Please refer to Section 701 of R.A. No. 10863 and Section 4.9.2 of CAO No. 9 -2020. In the 
case of FOB application, ex -factory prices are not applicable since the cost of goods already 
covers the transportation from the factory to the port of loading. For p urposes of computing 
duties and taxes in the Philippines, CIF is applied.  
 
7. Where is the rate of exchange published, as required by Article 9.1?  
The Bangko Sentral ng Pilipinas (BSP) issues the official exchange rate which are published 
in major newspapers or in BSP's website.  Also, all published rates are circulated by the BOC 
through Customs Memorandum Circular on a weekly basis.  
 
8. What steps have been taken to ensure confidentiality, as required by Article 10?  
Confidentiality is ensured through the provisi ons in Section s 111 and 112 of the CMTA and 
Sections 6 and 8.12 of CMO No. 53-2019 – Freedom of Information Manual . 
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  9. Questions Concerning Article 11:  
(a) What rights of appeal are open to the importer or any other person?  
The right of appeal to the importer an d other persons is provided for in Section s 114 and 
1106 of R.A. No. 10863 (CMTA) ; Sections 14, 16 and 17 of CAO No. 10 -2020 – Seizure and 
Forfeiture Proceedings and Appeals Process ; and Section 6.4 to 6.6 of CAO No. 2 -2020.  
 
(b) How is he to be informed of hi s right to further appeal?  
Information on the right to further appeal is provided in Section 113 of R.A. No. 10863 
(CMTA), CAO No. 10 -2020 and Sections 6.2.1 to 6.2.2 of CAO No. 2 -2020.  
 
10. Provide information on the publication, as required by Article 12, of: 
(a)  
(i) The relevant national laws;  
This is contained in the "Customs Modernization and Tariff Act (CMTA) " or R.A. 
No. 10863, that reflects WTO Valuation Agreement. Nonetheless , all CAOs are 
published in newspapers of general circulation or on the officia l gazette.  
 
CAO No. 9 -2020 on Clearance Procedures for Goods Entered for Consumption under 
the Formal Entry Process  
 
(ii) The regulations concerning the application of the Agreement;  
CAO No. 2 -99 on Rules and Regulations Implementing Section 1 of RA 8181 amending 
Section 201 of Title II, Part I of Presidential Decree No. 1464, otherwise known as the 
Tariff and Customs Code of the Philippines, and repealed by R.A. No. 10863, on the 
Determination of Customs Dutiable Value.  
 
CMO No. 3 -2000 on Enhance Cargo Cl earance Procedures with Provisions on Tentative 
Release and CMO No. 10 -2000 on Detailed Procedures to Further Implement CMO 
No. 3-2000.  
 
CMO No. 27 -99 and CAO No. 2 -2020 on Procedures in Protest Cases on the 
Determination of the Customs Value of Imported G oods under the WTO Valuation 
Regime.  
 
CAO No. 9 -2020 on Clearance Procedures for Goods Entered for Consumption under 
the Formal Entry Process  
 
CAO No. 2-2020 on Dispute Settlement and Protest  
 
CAO No. 10 -2020 on Seizure and Forfeiture Proceedings and Appeals Process  
 
(iii)  The judicial decision and administrative rulings of general application 
relating to the Agreement;  
There  is no jurisprudence as of yet relating to the agreement.  
 
(iv) General or specific laws being referred to in the rules of i mplementation or 
application.  
The Customs Modernization and Tariff Act (CMTA) or R.A. No. 10863 is the general 
law referred to.  
 
(b) Is the publication of further rules anticipated? Which topics would they cover?  
Rules on importation and cross -border movement of e-commerce goods.  G/VAL/N/2/PHL/2  
 
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  11. Questions concerning Article 13:  
(a) How is the obligation of Article 13 (last sentence) being dealt with in the respective 
legislation?  
 
This is dealt with under  Section s 403, 425, 426 , 707 and 1106 of R.A. No. 10863 ; CAO 
No. 9-2020; and CAO No. 2 -2020.  
 
(b) Have additional explanations been laid down?  
 
Yes, please refer to CAO No. 9 -2020; and CAO No. 2 -2020.  
 
12. Questions concerning Article 16:  
(a) Does the respective national legislation contain a provision requiring customs 
authorities to give an explanation in writing as to how the customs value was 
determined?  
 
Yes. Please refer to the first and last paragraph of Section 707 of R.A. No. 10863, 
Section  4.10 of CAO No. 9 -2020. 
 
(b) Are there any further regulations co ncerning an above -mentioned request?  
 
None 
 
13. How have the Interpretative Notes of the Agreement been included?  
These have been expressly included through specific provisions in R.A. No . 10863 and 
relevant CAOs or CMOs.  
 
14. How have the provisions of the Decisi on on the Treatment of Interest Charges in 
the Customs Value of Imported Goods been implemented?  
The Philippines does not treat interest charges as part of the customs value of imported 
goods because there is no existing law or domestic regulation that req uires the inclusion of 
such charges.  However, for purposes of imposing penalty, interest charge s are collected 
pursuant to Section 104 of the CMTA  and surcharges are collected under Section 1425 of 
the CMTA.  
 
15. For those countries applying paragraph 2 of the Decision on the Valuation of Carrier 
Media Bearing Software for Data Processing Equipment, how have the provisions 
of this paragraph been impleme nted?  
Under the current practice, only the cost of the medium is subject to taxes and duties , unless 
exempted if the value is considered de minimis pursuant to Section 423 of the CMTA. The 
cost of the software or data is not considered in the computation of the transaction value.  
 
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