Republic of the Philippines

HOUSE OF REPRESENTATIVES [ 30 WL 2044
Quezon City { Zep)
a)
SIXTEENTH CONGRESS “

Second Regular Session

House Bat No,__ 4767

Introduced by: Hon, CONRADO M. ESTRELLA Ill and
Hon. FRANCISCO EMMANUEL R. ORTEGA IIL

EXPLANATORY NOTE

WHEREAS, notwithstanding the Philippines’ status as an emerging economy, as evidenced by the reports
from the recently hosted World Economic Forum, it continues to grapple with a prolonged battle against
smuggling;

WHEREAS, aside from depriving the government of much needed revenue, smuggling fosters unfair
competition thereby posing a constant hindrance to the growth of domestic industries;

WHEREAS, due to the influx of smuggled goods, local producers and manufacturers, as well as licensed
distributors, wholesalers and retailers are unjustly prejudiced, which eventually lead to the incurring of
substantial business losses, the closure and cessation of legitimate businesses, the loss of millions of jobs
for Filipinos, to the detriment of the Philippine economy;

WHEREAS, smuggling likewise exposes the public to substandard and noxious products;
WHEREAS, considering the far-reaching detrimental effect of smuggling to the Philippine economy and

to Filipinos, regardless of their socio-economic status, large scale smuggling should be considered as a
form of economic sabotage.

Itis in this view iy

}O M. ESTRELLA TIT HON. FRANCISCO EMMANUEL R. ORTEGA IIT

fate passage of this bill is earnestly sought.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
Second Regular Session

HOUSE BILLNo.__ 4767

Intoduced by: Hon, Conrado M, Estrella III and
Hon, Francisco Emmanuel R, Ortega III

AN ACT AMENDING PRESIDENTIAL DECREE NO. 1464, OTHERWISE KNOWN
AS “THE TARIFF AND CUSTOMS CODE OF THE PHILIPPINES”, TO DEFINE
SMUGGLING AS AN ACT THAT CONSTITUTES ECONOMIC SABOTAGE, TO
PROVIDE THE APPROPRIATE PUNISHMENT AND PENALTIES THEREFOR,
AND FOR OTHER PURPOSES.

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled

Section 1, Section 3514 of Presidential Decree, 1464 is hereby amended to read as follows
““Sec.3514, Words and Phrases Defined, ~ As used in this Code
‘Foreign port” means a port or place outside the jurisdiction of the Philippines,

“Port of entry’ is a domestic port open to both foreign and coastwise trade, The term includes
principal ports of entry and sub ports of entry. A ‘principal port of entry” is the chief port of entry of the
collection district wherein itis situated and is the permanent station of the Collector of such port. Subports of
y the administrative jurisdiction of the Collector of the principal port of entry of the district
‘Whenever the ‘Port of entry” is used herein, it shall include ‘airport of entry”

“Person” whether singular or plural refers to an individual, corporation, partnership, association,
‘cooperative, company or any other kind of organization,

“Economic Sabotage’ refers to any and all activities that undermines, weakens or renders into
disrepute the economic system or viability of the country or tends to bring about such effects. For the purpose of
this Act, any violation of Section 3601 and 3602 of this Act, which involves goods and/or articles with the
aggregate value of One Million Pesos (Php 1,000,000.00), shall constitute as “Economic Sabotage”

Section 2, Section 3601 of Presidential Decree No. 1464 is hereby amended to read as follows:

“Sec. 3601. Unlawful Importation ~ Any person who shall fraudulently import or bring in to the
Philippines, or assist in so doing, any article, contrary to law, or shall receive, conceal, buy, sell or in any
‘manner facilitate the transportation, concealment, of sale of such article after importation, knowing the same to
have been imported contrary to law, shall be punished by a fine of not less than Six Hundred Pesos (Php 600.00)


‘nor more than Five Thousand Pesos (Php5000.00) and imprisonment for not less than six (6) months nor more
than two (2) years and ifthe offender is an alien, he shall be deported alter serving the sentence.

Any violation of this provision that constitutes as economic sabotage, as defined in this Act, shall be
punished as follows:

(@) Fine equal to twice the fair market value of the articles involved,

(b) Fine equal to the aggregate amount of the taxes, duties and other charges avoided;

(©) Imprisonment of a minimum of eight (8) years and one (1) day up to life imprisonment; and

( Confiscation of the articles involved.

Ifthe person violating this provision is a juridical entity, the penalty of imprisonment shall be imposed

fn the president and the responsible officers thereof. In addition, the business permits and licenses of the
business entity shall be revoked or cancelled.

‘The broker of the violator of this provision shall be punished as a principal

When, upon trial for a violation of this section, the defendant is shown to have or to have had
possession of the article in question, such possession shall be deemed sufficient evidence to authorize
‘conviction, unless the defendant shall explain the possession to the satisfaction of the court.”

Section 3, Sec, 3602 of Presidential Decree No. 1464 is hereby amended to read as follows:

“S0c.3602, Various Fraudulent Practices Against Customs Revenue. - Any person who makes or
attempts to make any entry of imported or exported article by means of any false or fraudulent invoice,
declaration, affidavit, letter, paper, or by means of any false statement, written or verbal or by means of any
false or fraudulent practice whatsoever, or shall be guilty of any willful act or omission by means of whereof the
Government might be deprived of the lawful duties, taxes and other charges, or any’ portion thereof, accruing
from the article or any portion thereof, embraced or referred to in such invoice, declaration, affidavit, letter,
paper, of statement, or affected by such act or omission, shall, for each offense, be punished by a fine of not fess
than Six Hundred Pesos (Php 600.00) nor mote than Five Thousand Pesos (Php 5000.00) and by imprisonment
for not less than six (6) months nor more than two (2) years and if the offender is an alien, he shall be deported
after serving the sentence.

Any violation of this provision that constitutes as economic sabotage, as defined in this Act, shall be
punished as follows:

(a) Fine equal to twice the fair market value of the articles involved:
(b) Fine equal to the aggregate amount of the taxes, duties and other charges avoided;

(©) Imprisonment of a minimum of eight (8) years and one (1) day up to life imprisonment; and

(@ Confiscation of the articles involved.

If the person violating this provision is a juridical entity, the penalty of imprisonment shall be imposed

‘on the president and the responsible officers thereof. In addition, the business permits and licenses of the
‘business entity shall be revoked or cancelled,


‘The broker ofthe violator of this provision shall be punished as a principal.”
Section 4. Repealing Clause ~ All laws, decrees, executive orders, issuances or regulations inconsistent which
the provisions of this Act hereby revised or amended accordingly.

Section 5, Reparability Clause - If any part of this Act is declared unconstitutional or invalid such parts or
provisions thereof not so declared shall remain valid and subsisting,

Section 6. Effectivity Clause ~ This Act shall take effect fifleen (15) days after its publication in at least two (2)
Newspapers of general circulation.