FOURTEENTH CONGRESS OF THE 
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First Regular Session 
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7 J~JL -3 if621 
REPUBLIC OF THE PHILIPPINES 
SENATE 
,I, 
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IIECEIVED 
S.B.No. 905 
Introduced by SENATOR EDGARDO J. ANGARA 
EXPLANATORY NOTE 
Efforts of the Government to suppress smuggling and other frauds 
upon the customs have been stymied by the indiscriminate issuance of 
temporary restraining orders and injunctive reliefs by judicial authorities. 
While the provisions of the Tariff and Customs Code on administrative 
proceedings leading to forfeiture and disposition of smuggled goods and the 
instruments used for smuggling seem fairly adequate, the provisions allowing 
judicial intervention have oftentimes rendered ineffective the serious efforts 
to go after the smugglers, the goods fraudulently imported, and the 
instruments of smuggling. 
The disposition and forfeiture of goods seized by the Bureau of 
Customs will be strengthened under this bill. To expedite the disposition of 
these goods, the Secretary of Finance, upon recommendation of the 
Commissioner of Customs, is empowered to summarily seize and sell the 
same. Moreover, no temporary restraining order shall lie against the seizure 
and disposition of the subject goods as well as the aircraft or vessel used in 
transporting the same. 
Administrative summary proceedings appear to be the most effective 
vehicle to curb smuggling. Judicial intervention should be invoked only at the 
level of the Supreme Court, doing away with the present state of the law 
where even Regional Trial Courts can stop the sale of forfeited smuggled 
property or even allow the posting of bonds for those whose vessels or aircraft 
were used in smuggling. 
Smugglers themselves should not be allowed to profit from their own 
violation of our customs laws. They should be barred from involvement in 
auction sales of the very items or goods they brought in fraudulently. 
In view of the foregoing, immediate passage of this bill is earnestly 
requested. 
2fl /A 
EDGARDO J. ANGARA 
Senator 


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FOURTEENTH CONGRESS OF THE 
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JIjL -3 P 6 2 1  
REPUBLIC OF THE PHILIPPINES 
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First Regular Session 
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, \qfgEMED W: 
SENATE 
S. B. No. 905 
Introduced bv SENATOR EDGARDO J. ANGARA 
AN ACT RATIONALIZING THE FORFEITURE AND DISPOSITION 
OF PROPERTY SEIZED BY THE BUREAU OF CUSTOMS, 
AMENDING FOR THE PURPOSE CERTAIN SECTIONS OF THE 
TARIFF AND CUSTOMS CODE OF THE PHILIPPINES, AS 
AMENDED 
Be it enacted by the Senate and the House of Representatives of the 
Philippines in Congress assembled: 
SECTION 1. Section 2601 of the Tariff and Customs Code of the 
Philippines, as amended, is hereby further amended to read as follows: 
“SECTION 2601. Property Subject to Sale. - Property in customs 
custody shall be subject to sale under the conditions hereinafter 
provided: 
“a. Abandoned articles; 
“b. Articles entered under warehousing entry not withdrawn nor 
the duties and taxes paid thereon within the period prescribed under 
Sections 1908 of this Code; 
“c. Seized property, other than contraband, after liability to sale 
shall have been established by proper administrative [or judicial] 
proceedings in conformity with the provision of this Code; and 
“d. Any article subject to a valid lien for customs duties, taxes or 
other charges collectible by the Bureau of Customs, after the 
expiration of the period allowed for the satisfaction of the same.” 
SECTION 2. Section 2604 of the Tariff and Customs Code of the 
Philippines, as amended, is hereby further amended to read as follows: 
“SECTION 2604. Disqualification to Participate in Auction Sale. 
- No Customs official or employee; THE OWNERS, OR OTHER 
AGENTS, OF THE PROPERTY SUBJECT TO SALE; AND, THE 
IMPORTER OR CONSIGNEE OF THE PROPERTY SUBJECT TO 
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SALE; THE OWNERS, OR THEIR AGENTS, OF THE VESSEL OR 
AIRCRAFT SUBJECT TO SALE shall be allowed to bid directly or 
indirectly in any customs auction.” 
SEC 3. Section 2607 of the Tarife and Customs Code of the 
Philippines, as amended, is hereby further amended to read as follows: 
“Section. 2607. Disposition of Articles Liable to Deterioration. - 
Perishable articles shall be deposited in any appropriate bonded 
warehouse; and, if not immediately entered for export or for 
transportation from the vessel or aircraft in which imported or entered 
for consumption and the duties and the taxes paid thereon, such 
articles SHALL [ may ] be sold at auction [ , after such public notice, 
not exceeding three days, ] as the necessities of the case permit. 
“When seizure shall be made of property which, in the opinion of 
the Collector, is liable to perish or be wasted or to depreciate greatly in 
value by keeping, or which cannot be kept without great 
disproportionate expense, whether such property consists of live 
animals or of any article, the appraiser shall so certify his appraisal, 
the Collector SHALL [ may ] proceed to advertise and sell the same at 
auction, upon notice as he shall deem to be reasonable. 
“The same disposition SHALL [ may ] be made of any 
warehoused article when in the opinion of the Collector it is likely that 
the cost of depreciation, damage, leakage or other causes, may so 
reduce its value as to be insufficient to pay the duties, taxes and other 
charges thereon, if it should be permitted to be so kept and be 
subjected to sale in the usual course. 
“PROVIDED, THAT IN ALL CASES INVOLVING ARTICLES 
LIABLE TO DETERIORATION, THE DETERMINATION THEREON 
SHALL BE EXCLUSIVE TO THE COLLECTOR AND SHALL BE 
FINAL ON THE MATTER; PROVIDED FURTHER, THAT THE 
AUCTION SALE SHALL BE HELD NOT LATER THAN TWO (2) 
DAYS AFTER THE PUBLIC NOTICE SET BY THE COLLECTOR.” 
SECTION 4. Section 2610 of the Tariff and Customs Code of the 
Philippines, as amended, is hereby further amended to read as follows: 
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“Section. 2610. Disposition of Unsold Articles for Want of 
Bidders. - Articles subject to sale at public auction by customs 
authorities shall be sold at a price not less than the wholesale value 
price in the domestic market of these or similar articles in the usual 
wholesale quantities and in the ordinary course of trade as determined 
in accordance with section twenty-three hundred and five of this code. 
“When any article remains unsold in at least two public biddings 
for want of bidders or for lack of an acceptable bid, and the article is 
perishable and/or suitable for official use, then the Collector shall 
report the matter immediately to the Commissioner of Customs who 
SHALL [ may, subject to the approval of the Secretary of Finance, ] 
authorize the official use of that article by the Bureau of Customs to 
promote the intensive collection of taxes and/or to help prevent or 
suppress smuggling and other frauds upon the Customs, and if the 
article is not suitable for such use, then it may be channeled to the 
official use of other offices of the National Government AS THE 
COMMISSIONER OF CUSTOMS MAY DETERMINE. If the article is 
suitable for shelter or consists of foodstuffs, clothing materials or 
medicines then that article shall be given to government charitable 
institutions through the Department of Social WORK Services ] and 
Development. AGRICULTURAL PRODUCTS SHALL BE GIVEN TO 
THE 
DEPARTMENT 
OF 
AGRICULTURE 
FOR 
PROPER 
DISPOSITION. 
“If the article offered for sale is not suitable either for official use 
or charity, then the same may be re-exported as government property, 
through the Department of Trade AND INDUSTRY or any other 
government entity through barter or sale. If the article cannot be 
disposed of as provided above, the Collector shall report the matter 
immediately to the commissioner who SHALL [ may, subject to the 
approval of the Secretary of Finance ] dispose of the article to the best 
advantage of the government in a negotiated private sale which shall 
be consummated in the presence of a representative of the Commission 
of Audit., in the manner provide for by this Code.” 
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SECTION 5. Section 2612 of the Tariff and Customs Code of the 
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“Section 2612. Disposition of Smuggled Articles. - Smuggled 
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articles, after liability to seizure or forfeiture shall have been 
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established by proper administrative [ or judicial ] proceedings in 
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conformity with the provisions of this Code, shall be disposed of as 
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provided for in Section 26 10: Provided, That articles whose 
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importation is prohibited under Section 102, sub-paragraphs b, c, d, c 
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and j shall, upon order to the Collector in writing, be burned or 
so 
destroyed, in such manner as the case may require as to render them 
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absolutely worthIess, in the presence of a representative each from the 
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Commission on Audit, [ Ministry ] Department of Justice, Bureau of 
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Customs, and if possible, any representative of the private sector.” 
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“SECTION. 3613[A]. SUMMARY PROCEDURE FOR SEIZURE 
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AND FORFEITURE. - NOTWITHSTANDING THE PROVISIONS OF 
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TITLE VI OF THIS CODE, PROPERTY WHICH ARE IMPORTED OR 
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BROUGHT IN TO THE PHILIPPINES WITHOUT THE NECESSARY 
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PERMIT 
AND/OR 
PAYMENT 
OF 
THE 
RELEVANT 
AND 
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APPLICABLE 
TAXES, 
FEES AND 
CHARGES, 
SHALL BE 
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SUMMARILY SEIZED AND FORFEITED IN FAVOR OF THE 
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GOVERNMENT. ANY VESSEL OR AIRCRAFT USED TO BRING IN 
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SAID IMPORTED GOODS INTO THE PHILIPPINES SHALL 
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LIKEWISE 
BE 
SUBJECT TO 
SUMMARY SEIZURE 
AND 
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FORFEITURE. 
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‘THE DECISION OF THE SECRETARY OF FINANCE, UPON 
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THE 
RECOMMENDATION 
OF 
THE 
COMMISSIONER 
OF 
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CUSTOMS, UNDER THIS SECTION SHALL BE FINAL AND 
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UNAPPEALABLE. 
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“NO COURT, EXCEPT THE SUPREME COURT, SHALL 
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ISSUE ANY TEMPORARY RESTRAINING ORDER OR ANY 
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INJUNCTIVE RELIEF AGAINST THE SEIZURE, FORFEITURE OR 
Philippines, as amended, is herby further amended to read as follows: 
SECTION 6. A new section, to be referred to hereafter as Section 
3613[A], is hereby inserted to the Tariff and Customs Code of the Philippines, 
the said new section to read as follows: 
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SALE OF ANY OF THE GOODS OR ARTICLES COVERED BY THIS 
SECTION. 
“THE OWNER OR OPERATOR OF ANY SEIZED VESSEL OR 
AIRCRAFT UNDER THIS SECTION SHALL BE BLACKLISTED 
FROM OPERATING AND/OR FROM ENGAGING IN TRADE IN THE 
PHILIPPINES.” 
SECTION 7. Separability Clause. - If any part or parts of this Act 
should, for any reason, be held to be invalid or unconstitutional, the 
remaining parts thereof shall remain in full force and effect. 
SECTION 8. Repealing Clause. -All laws, decrees, executive orders, 
rules and regulations and other issuances inconsistent with this Act are 
hereby repealed or modified accordingly. 
SECTION 9. Effectivity. - This Act shall take effect after fifteen (15) 
days from the date of publication in at least two (2) newspapers of general 
circulation. 
Approved, 
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