:, i ',,~, 
.... 
FOURTEENTH CONGRESS OF THE REPUBLIC 
) 
.. 
OF THE PHILIPPINES 
1 
--J 
, 
First Regular Session 
1 
Introduced by Senator Ramon Bong Revilla, Jr. 
EXPLANATORY NOTE 
A broadsheet of national circulation reported that the Cebu Auto Dealers 
Association (CADA) is complaining on the alleged smuggling of cars in Cebu. It 
was reported that CADA exposed the disparity on the number of vehicles sold 
and the number of registered vehicles in the province, to wit: the number of 
registered vehicles in Cebu exceeded by 20,000 units the number of cars sold by 
legitimate car dealers in the province in the year 2006. 
Smuggling has been one of the major economic problems the country is 
facing. The illegal entry of goods in the local market has caused the government 
to lose huge amounts of revenues. 
This proposed bill seeks to address the problem of smuggling through 
amending certain provisions of the Tariff and Customs Code of the Philippines. 
This version of the "Anti-Smuggling Act" has been prepared by the Senate 
Committees on Trade and Commerce and Economic Affairs in the Thirteenth 
Congress but has failed to become a law. This representation trusts the noble 
intent of the measure and is re-filing the same. 
Strengthening the government's anti-smuggling drive has been identified 
as one of the necessary strategies to generate much needed government 
cevenues. In this regard, passage of this bill is earnestly sought. 


~
,
,
 
FOURTEENTH CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINES 
1 
<i , : i  I i!; 
First Regular Session 
1 
Introduced by Senator Ramon Bong Revilla, Jr. 
AN ACT 
AMENDING CERTAIN PROVISIONS OF PRESIDENTIAL DECREE NO. 1464, 
OTHERWISE KNOWN AS THE TARIFF AND CUSTOMS CODE 
OF THE PHILIPPINES, AS AMENDED, AND FOR OTHER PURPOSES 
Be it enacted by' the Senate and House of Representatives of fbe 
Congress assembled: 
SECTION I. Short Title. - This Act shall be known as the "Anti-Smuggling Act 
of 2008". 
SEC 2. Section 601 of the Tariff and Customs Code of the Philippines (TCCP), 
as amended, is hereby further amended to read as follows: 
"Sec. 601. Chief Oficials of the Bureau of Customs. - The Bureau 
of Customs shall have one and FIVE [four] assistant chiefs, to be 
known respectively as the Commissioner of Customs (hereinafter 
known as the Commissioner) and FIVE (5) Deputy Commissioners 
of Customs, each one to head (a) Customs Revenue and 
Collection Monitoring Group; (b) Customs Assessment and 
Operations Coordinating Group; (c) Intelligence and Enforcement 
Group; (d) Internal Administration Group; AND (E) AUDIT AND 
TRANSPARENCY 
GROUP, 
who 
shall receive an annual 
compensation in accordance with the rates prescribed by existing 
law. The Commissioner AND DEPUTY COMMISSIONER FOR 
AUDIT 
AND 
TRANSPARENCY 
SHALL 
BE 
DIRECTLY 
APPOINTED BY THE PRESIDENT. THE OTHER DEPUTY 
COMMISSIONERS 
SHALL 
BE 
APPOINTED 
BY 
THE 
PRESIDENT 
OF 
THE 
PHILIPPINES 
BASED 
ON 
THE 
RECOMMENDATION OF THE COMMISSIONER." 
"In case of temporary and permanent vacancy, one of the Deputy 
'Commissioners shall be designated by the Secretary of Finance to 
act as a Commissioner of Customs, until the incumbent 
Commissioner reassumes his duties or the position is filled by 
permanent appointment." 
SEC 3. Section 607 of the Tariff and Customs Code of the Philippines (TCCP), 
as amended, is hereby further amended to read as follows: 
"Sec. 607. Annual Reporf of Commissioner. - The annual report of 
the Commissioner to the President shall, among other things, 
contain a compilation of the (a) quantity and value of the articles 
imported into the Philippines and the corresponding amount of 
customs duties, taxes and other charges assessed and collected 
on imported articles itemized in accordance with the tariff headings 


and subheadings as appearing in the liquidated customs entries 
provided for in this Code, (b) percentage collection of the peso 
value of imports, (c) quantity and value of conditionally-free 
importations, (d) customs valuation over and above letters of credit 
opened, (e) quantity and value of tax-free imports, and (f) :the 
quantity and value of articles exported from the Philippines as well 
as the taxes and other charges assessed and collected on them for 
the preceding year. THE DEPUTY COMMISSIONER FOR AUDIT 
AND TRANSPARENCY SHALL REGULARLY FURNISH copieb of 
such annual report [shall be furnished regdarly] to the Departdent 
of Finance, Tariff Commission, NEDA, BANGKO SENTRAL 'NG 
PILIPINAS [Central Bank of the Philippines], Board of Investments, 
Department of Budget, and other economic agencies of ,the 
government, on or before December 30 of each year. 
"For more scientific preparation of the annual report, ,the 
Commissioner shall cause the computerization of 
the data 
contained in the liquidated entries filed with the Bureau, of 
Customs." 
SEC 4. Section 609 of the Tariff and Customs Code of the Philippines (TCCP), 
as amended, is hereby further amended to read as follows: 
"Sec. 609. Commissioner to Furnish Copies of Collectors' 
Liquidated Duplicafes. - The Commissioner shall regularly furnish 
the NEDA, the BANGKO SENTRAL NG PILIPINAS [Central Bank 
of the Philippines], the Tariff Commission, AND THE NATIONAL 
STATISTICS OFFICE (NSO), BOTH ELECTRONIC AND PAPER 
COPIES of each of all customs import I export entries as filed with 
the Bureau of Customs. The Tariff Commission or its duly 
authorized agents shall have access to and the right to copy all the 
customs liquidated import entries and other documents appended 
thereto as finally filed in the Commission on Audit. COPIES OF 
THE 
FOREGOING 
DOCUMENTS 
SHALL 
BE 
MADE 
ACCESSIBLE 
AND 
AVAILABLE 
TO 
THE 
DEPUTY 
COMMISSIONER FOR AUDIT AND TRANSPARENCY AT ALL 
TIMES." 
SCC 5. Section 709 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 709. Authorit) of the Collecfor to Remit Dufies. - A Collector 
shall have discretionary authority to remit the assessment and 
collection of customs duties, taxes, and other charges when the 
aggregate amount of such duties, taxes, and other charges is less 
than FIVE THOUSAND PESOS (P5,000.00), and he may dispense 
with the seizure of articles of less than FIVE THOUSAND PESOS 
(P5,OOO.OO) in val,ue except in cases of prohibited importations of 
the habitual or the intentional violation of the tariff and customs 
laws." 
SEC 6. A new part shall be inserted starting with SECTION 713, after Section 
712 of the TCCP, as amended, which shall read as follows: 
"PART 3. - AUDIT, TRANSPARENCY AND ACCOUNTABILITY. 
"SECTION 713. THE DEPUTY COMMISSIONER FOR AUDIT 
AND TRANSPARENCY SHALL CONDUCT, IN COORDINATION 
WITH THE COMMISSION ON AUDIT, A BUREAU-WIDE AUDIT 
2 


ON THE OPERATIONAL PROCESSES, COLLECTION AND 
FINANCIAL 
REPORTING, 
FISCAL 
AND 
PERSONNEL 
PERFORMANCE, SYSTEM EFFICIENCY, INTERNAL CONTROL, 
INFORMATION AND COMMUNICATION FLOW, FRAUDULENT 
AND ILLEGAL PRACTICES, AND SUCH OTHER AREAS AS 
MAY BE NECESSARY FOR THE EFFECTIVE OPERATION OF 
THE BUREAU AND ITS ATTACHED AGENCIES. 
“SECTION 714. THE APPROPRIATIONS FOR THE BUREAU OF 
CUSTOMS SHALL PROVIDE AN ITEM OF EXPENSE FOR 
AUDIT AS CONTEMPLATED UNDER THIS ACT, INCLUDING A 
PROVISION FOR AN INDEPENDENT AUDIT OF THE BUREAU 
BY A QUALIFIED PRIVATE COMPANY OR INSTITUTION, 
WHICH SHALL BE CONDUCTED ANNUALLY, OR IN SUCH 
FREQUENCY AS MAY BE DETERMINED BY THE DEPUTY 
COMMISSIONER FOR AUDIT AND TRANSPARENCY UPON 
APPROVAL OF THE COMMISSIONER. 
“SECTION 715. ON THE BASES OF THE AUDIT CONDUCTED 
PURSUANT TO THE PRECEDING SECTIONS, THE DEPUTY 
COMMISSIONER FOR AUDIT AND TRANSPARENCY SHALL 
HAVE THE AUTHORITY TO FORMULATE AND RECOMMEND 
POLICIES TO THE COMMISSIONER TO ADDRESS THE 
IDENTIFIED PROBLEMS AND DEFICIENCIES. UNLESS THERE 
IS REASONABLE DOUBT ON THE VALIDITY OF THE SAID 
AUDIT, THE RECOMMENDATIONS SHALL HAVE PERSUASIVE 
WEIGHT AND SHALL BE PROMPTLY ACTED UPON BY THE 
COMMISSIONER. 
“THE DEPUTY COMMISSIONER SHALL LIKEWISE HAVE THE 
AUTHORITY TO CONDUCT INVESTIGATIONS FOR THE 
PURPOSE OF INITIATING PROSECUTION OF FRAUD AND 
OTHER GRAFT AND CORRUPT PRACTICES IN THE BUREAU, 
AND SHALL RECOMMEND TO THE OMBUDSMAN THE FILING 
OF APPROPRIATE CRIMINAL CASES AGAINST THE ERRING 
PERSONNEL, AND TO THE COMMISSIONER THE IMPOSITION 
OF ADMINISTRATIVE SANCTIONS. 
“SECTION 716. IN THE CONDUCT OF ITS AUDIT AND 
INVESTIGATIONS, THE DEPUTY COMMISSIONER OR THE 
PRIVATE AUDITOR SHALL HAVE THE AUTHORITY TO 
REQUIRE THE PRODUCTION OF DOCUMENTS AND REQUIRE 
BUREAU PERSONNEL TO RESPOND TO ITS INQUIRIES. FOR 
THIS PURPOSE, IT MAY ISSUE SUBPOENA DUCES TECUM 
AND AD TESTINCANDUM. ANY PERSON WHO SHALL 
REFUSE TO ABIDE BY THE SUBPOENA SO ISSUED MAY BE 
HELD LIABLE FOR CONTEMPT. 
“SECTION 717. THE DEPUTY COMMISSIONER FOR AUDIT 
ANDTRANSPARENCYSHALLSUBMITANANNUALREPORT 
TO THE COMMISSIONER, THE SECRETARY OF FINANCE, THE 
OFFICE OF THE PRESIDENT, AND THE CONGRESS, STATING 
THE RESULT OF ITS INSPECTIONS AND AUDITS. THE 
REPORT SHALL CONTAIN ALL THE NECESSARY DATA 
WHICH LED TO ITS RECOMMENDATIONS AND FINDINGS, 
AND SHALL BE MADE AVAILABLE TO THE PUBLIC 
THROUGh ELECTRONIC AND NON-ELECTRONIC MEANS, 
UNLESS NON-DISCLOSURE IS WARRANTED BY NATIONAL 
SECURJ JY.” 
3 


SEC 7. A new section to be know as Section 1001-A is hereby inserted 
Section 1001 of the TCCP, as amended, which shall read as follows: 
“SEC. 1001-A. TRANSMISSION 
OF m x r R o N i c  COPY OF 
MANIFEST PRIOR TO ARRIVAL - AN ELECTRONIC COPY OF 
THE CARGO AND PASSENGER MANIFEST OF THE VESSEL 
ENGAGED IN FOREIGN TRADE SHALL BE TRANSMITTED TO 
THE BUREAU OF CUSTOMS AT LEAST SIX (6) HOURS PRIOR 
TO THE VESSEL’S ARRIVAL IN THE PORT OF ENTRY; 
PROVIDED, THAT IF THE VESSEL IS AN AIRCRAFT, THE 
MANIFEST SHALL BE TRANSMllTED TO THE BUREAU OF 
AIRCRAFT’S ARRIVAL IN THE PORT OF ENTRY.” 
CUSTOMS Ar LEAST ONE (1) HOUR PRIOR TO THE 
after 
SEC 8. Section 1007 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 1007. Manifests for Commission on Audit and Collector- 
Papers to be Deposited wifb Consul. - Immediately after the arrival 
of a vessel from a foreign port, the master shalt deliver or mail to 
the Chairman, Commission on Audit, Manila AND THE DEPUTY 
COMMISSIONER FOR AUDIT AND TRANSPARENCY, a copy of 
the cargo manifests properly endorsed by the boarding officer, and 
the master shall immediately present to the Collector the original 
copy of the cargo manifests properly endorsed by the boarding 
officer, and, for inspection, the ship’s register or other documents in 
lieu thereof, together with the clearance and other papers granted 
to the vessel at the port of departure for the Philippines.” 
SEC 9. Section 1210 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 121 0. Disposition of Imported Articles Remaining on Vessel 
After Time for Unlading. - Imported articles remaining on board any 
vessel after the expiration of the said period for discharge and not 
reported for the transshipment to another port, may be unladen by 
customs authorities and stored at the vessef‘s expense.” 
“Unless prevented by causes beyond the vessel’s control, such as 
port congestion, strikes, riots, or civil commotions, failure of 
vessel’s gear, bad weather, and similar causes, articles so stored 
shall be entered within FIFTEEN (15) DAYS, which shall not be 
extendible from the date of discharge of the last package from the 
vessel or aircraft and shall be claimed within fifteen (15) days, 
which shall likewise not be extendible from the date of posting of 
the notice to claim in conspicuous places in the Bureau of 
Customs. If not entered or not claimed, it shall be disposed of in 
accordance with the provisions of this Code.” 
SEC 10. A new section to be known as Section 1401-A is hereby inserted after 
Section 1401 of the TCCP, as amended, which shall read as follows: 
“Sec. 1401-A. VALUATION LIBRARY. - THE COMMISSIONER 
SHALL ENSURE THAT THERE SHALL BE A VALUATION 
LIBRARY, WHICH SHALL BE KEPT UP TO DATE AND 
MAINTAINED USING THE BEST AVAILABLE TECHNOLOGY. 
THE VALUATION LIBRARY SHALL BE MADE READILY 
AVAILABLE TO THE PUBLIC.” 
4 


SEC 11. Section 1403 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1403. Dufies of Cusforns Ofilter Tasked to Examine, Classify, 
and Appraise Imported Articles. - The customs officer tasked to 
examine, classify, and appraise imported articles shall determine 
whether the packages designated for examination and their 
contents are in accordance with the declaration in the entry, 
invoice, and other pertinent documents ana shall make a return in 
such a manner to indicate whether the articles have been truly and 
correctly declared in the entry as regard their quantity, 
measurement, weight, and tariff classification and not imported 
contrary to law. THE CUSTOMS OFFICER SHALL LIKEWISE 
CERTIFY UNDER OATH IN THE RETURN THAT HE USED THE 
VALUATION LIBRARY IN CLASSIFYING AND APPRAISING 
THE IMPORTED ARTICLES. He shall ALSO submit a sample to 
the laboratory for analysis when feasible to do so and when such 
analysis is necessary for the proper classification, appraisal, and / 
or admission into the Philippines of imported articles. 
"Likewise, the customs officer shall determine the unit of quantity in 
which they are usually bought and sold and appraise the imported 
articles in accordance with Section 201 of this Code. 
"Failure on the part of the customs officer to comply with his duties 
shall subject him to the penalties preswibed under Section 3604 of 
this Code." 
SEC 12. Section 1801 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1801. Abandonmenf; Kinds and Effecfs. - An imported article 
is deemed abandoned under any of the following circumstances: 
a. When the owner, imported, consignee of the imported article 
expressly signifies in writing to the Collector of Customs his 
intention to abandon; 
b. When the owner, importer, consignee, or interested party after 
due notice, fails to file an entry within thirty (30) days, which 
shall not be extensible, from the date of discharge of the last 
package from the vessel or aircraft, or having filed such entry, 
fails to claim his importation within fifteen (15) days, which shall 
not likewise be extendible, from the date of posting of the notice 
to claim such importation; OR WHEN THERE IS A WRITTEN 
DENIAL OF OWNERSHIP FROM THE PERSON INDICATED 
ON THE MANIFEST OR BILL OF LADING AS THE OWNER, 
IMPORTER, OR CONSIGNEE OF THE IMPORTED ARTICLE. 
"Any person who abandons an article or who fails to claim his 
importation as provided for in the preceding paragraph shall be 
deemed to have renounced all his interests and property rights 
therein." 
SEC 13. Section 1802 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1802. Abandonment of lmpotfed Articles. - An abandoned 
article shall ipso facto be deemed the property of the Government. 
5 


ALL ABANDONED ARTICLES SHALL BE AUTOMATICALLY 
SUBJECT TO AUCTION AND SHALL IN NO CASE BE 
SUBJECT TO SETTLEMENT OR COMPROMISE. 
AN UPDATED LISTING OF ALL ABANDONED SHIPMENTS 
SCHEDULED FOR AUCTION SHALL BE POSTED ON THE 
OFFICIAL WEBSITE OF THE BUREAU OF CUSTOMS AND AT 
THE MAIN EN 
x x x  
x x x  
SEC 14. Section 190 
read as follows: 
RANCE OF CUSTOMS HOUSES. 
of the TCCP, as amended, is hereby further,amended to 
"Sec. 1901. Establishment and Supervision of Warehouses. - When 
the business of the port requires such facilities, the Collector, 
subject to the approval of the Commissioner, shall designate and 
establish INDUSTRY-SPECIFIC warehouses for use as a public 
and private bonded warehouses, sheds or yards, or for other 
special purposes. 
"All such warehouses and premises shall be subject to the 
supervision of the Collectors, who shall impose such conditions as 
may be deemed necessary for the protection of the revenue and of 
the articles stored therein." 
SEC 15. Section 1902 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1902. Responsibility of Operators. - The operators of bonded 
warehouses in case of loss of the imported articles stored shall be 
liable for the payment of duties and taxes due thereon. 
"The government assumes no legal responsibility in respect to the 
safekeeping of articles stored in any customs warehouse, sheds, 
yards, or premises. 
"THE OPERATORS OF THE BONDED WAREHOUSES SHALL, 
FOR LEGITIMATE PURPOSES, MAKE AVAILABLE TO THE 
PUBLIC 
AN 
INVENTORY OF ALL ARTICLES STORED 
THEREIN. FAILURE TO DO SO IS A MANDATORY GROUND 
FOR THE REVOCATION OF LICENSE TO OPERATE A 
BONDED WAREHOUSE." 
SEC 16. Section '1903 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec 
1903. 
Bonded Warehouses. 
- Application for 
the 
establishment of bonded warehouses must be made in writing and 
filed with the Collector, describing the premises, the location, and 
capacity of the same, the purpose for which the building is to be 
used, AND THE INDUSTRY TO WHICH IT BELONGS. THE 
APPLICATION SHALL LIKEWISE BE ACCOMPANIED BY 
VERIFIED 
COPIES 
OF 
DOCUMENTS 
INDICATING THE 
OWNERSHIP AND THE FINANCIAL CAPACITY OF THE 
BONDED WAREHOUSE. 
6 


“Upon receipt of such application, the Collector shall cause an 
examination of the premises, with reference particularly to its 
location, construction and means provided for the safekeeping of 
articles. THE COLLECTOR SHALL LIKEWISE DETERMINE THE 
OWNERSHIP OF THE APPLICANT BONDED WAREHOUSE TO 
VERIFY OWNERS OF A BONDED WAREHOUSE WHICH HAD 
CUSTOMS LAWS AND REGULATIONS HAS ANY INTEREST 
THEREIN. IF THE APPLICATION IS found satisfactory, THE 
COLLECTOR may authorize its establishment, and accept a bond 
for its operation and maintenance. The dperator of such bonded 
warehouse shall pay an annual supervision fee in an amount to be 
fixed by the Commissioner. The bonded warehouse officers and 
other employees thereof shall be regular customs employees who 
shall be appointed in accordance with the Civil Service Law, rules 
and regulations. 
“THE PAID-UP CAPITAL AND NET ASSETS OF THE BONDED 
WAREHOUSE SHALL BE SET AT AN AMOUNT DETERMINED 
BY THE COMMISSIONER AS SUFFICIENT TO COVER THE 
VALUE OF GOODS OF UNLIQUIDATED ENTRIES WHICH 
SHALL BE STORED THEREIN AT ANY 
GIVEN TIME. 
OTHERWISE, THE APPLICATION SHALL NOT BE GRANTED, 
AND AN AUTHORITY ALREADY GRANTED SHALL BE 
REVOKED. 
“THESE REQUIREMENTS SHALL LIKEWISE EXTEND TO 
REGISTERED 
LOCATORS 
OPERATING 
UNDER 
THE 
CHARTERES 
OF 
THE 
PHILIPPINE 
ECONOMIC 
ZONE 
AUTHORITY, THE SUBlC BAY METROPOLITAN AUTHORITY 
AND OTHER FREEPORTS AND ECOZONES.” 
SEC 17. A new section to be known as Section 1903-A is hereby inserted after 
Section 1903 of the TCCP, as amended, which shall read as follows: 
'‘Set. 1903-A. REGULAR AUDlT OF BONDED WAREHOUSE. A 
REGULAR AUDIT OF ALL BONDED WAREHOUSES SHALL BE 
CONDUCTED BY THE COLLECTOR, WHICH AUDIT SHALL BE 
SUBJECT TO AUTOMATIC 
REVIEW BY THE DEPUTY 
COMMISSIONER FOR AUDlT AND TRANSPARENCY. UPON 
PETITION OF AN INTERESTED PARTY, A SECOND AUDIT 
MAY BE CONDUCTED BY THE DEPUTY COMMISSIONER OR 
AN INDEPENDENT AUDIT MAY BE MADE UPON THE 
INSTANCE OF THE PETITIONING PARTY IN COORDINATION 
WITH THE DEPUTY COMMISSIONER.” 
SEC 18. Section 1904 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 1904. Irrevocable Domesfic Leffer of Credit or Bank 
Guarantee or Warehousing Bond. - After articles declared in the 
entry for warehousing shall have been examined and the duties, 
taxes, and other charges shall have been determined, the Collector 
shall require from the importer an irrevocable domestic letter of 
credit, bank guarantee, or CASH bond equivalent to the amount of 
such duties, taxes and other charges conditioned upon the 
withdrawal of articles within the period prescribed in section 
nineteen hundred and eight of this Code and for the payment of 
any duties, taxes and other charges to which the articles shall be 
3 


then subject and upon compliance with all legal requirements 
regarding their importation." 
SEC 19. Section 1905 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1905. Discontinuance of Warehouses. - The use of any 
warehouse may be discontinued by the Collector at any time when 
conditions so warrant, or in the case of a private warehouse, upon 
receipt of written request to that effect from the operator thereof of 
the premises, provided all the requirements of the law and 
regulations have been complied with by said operator. A 
LEGITIMATE 
INDUSTRY 
GROUP 
MAY 
LIKEWISE 
RECOMMEND TO THE COLLECTOR THE DISCONTINUANCE 
OF THE BONDED WAREHOUSE ON GROUNDS OF NON- 
COMPLIANCE WITH THE REQUIREMENTS OF LAW AND 
REGULATIONS. x x x" 
SEC 20. Section 1906 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1906. Enfry of Articles for Warehousing. - The entry of 
articles for warehousing shall be in the required number of copies 
in the prescribed form, and shall be verified as in the entry of the 
articles for consumption. No warehousing entry shall be accepted 
for any article if from the entry, supporting documents and I or 
information such article is imported contrary to any law. THE 
CUSTOMS OFFICER MAKING THE ENTRY SHALL BE 
RESPONSIBLE FOR TRANSMITTING A COPY OF THE SAME 
TO 
THE 
DEPUTY 
COMMISSIONER 
FOR 
AUDIT 
AND 
TRANSPARENCY. 
SEC 21. Section 1907 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1907. Withdrawal of Articles from Bonded Warehouse. - 
Articles enlered under irrevocable domestic letter of credit, or 
CASH bond may be withdrawn at any time for re-exportation; 
PROVIDED, THAT PROOF IS SHOWN THAT THE ORDER TO 
IMPORT THE SUBJECT ARTICLES HAS BEEN CANCELLED; 
PROVIDED FURTHER, 
THAT 
THE ARTICLES 
TO 
BE 
WITHDRAWN DO NOT AMOUNT TO MORE THAN FIFTY 
PERCENT (50%) OF THE TOTAL INVENTORY OF THE 
BONDED WAREHOUSE. 
"The withdrawal must be made ONLY BY THE IMPORTER OF 
THE 
ARTICLES 
BEING 
WITHDRAWN 
OR 
BY 
A 
REPRESENTATIVE whose authority must appear in writing upon 
the face of the withdrawal entry." 
SEC 22. Section 1908 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 1908. Limit to Period of Storage in Bonded Warehouse. - 
Articles duly entered for warehousing may remain in bonded 
warehouses for a maximum period of THIRTY (30) DAYS from the 
time of RECEIPT OF THE WAREHOUSE. Articles not withdrawn at 
the exoiration of the orescribed oeriod shall be DEEMED 


ABANDONED 
AND 
SUBJECT 
TO 
DISPOSITION 
IN 
ACCORDANCE WITH THE PROVISIONS OF THIS CODE.” 
SEC 23. A new section to be known as Section 1908-A is hereby inserted after 
Section 1908 of the TCCP, as amended, which shall read as follows: 
“SEC. 1908-A. LIQUIDATION OF WAREHOUSING ENTRIES. - 
THE LIQUIDATION OF WAREHOUSJNG ENTRIES SHALL BE 
MADE NOT MORE THAN THREE (3) MONTHS FROM THE TIME 
OF RECEIPT OF THE WAREHOUSE. 
“A DAILY RECORD OF ALL ENTRIES LIQUIDATED SHALL BE 
POSTED ON A CONSPICUOUS PLACE IN THE MAIN 
ENTRANCE OF THE CUSTOMS HOUSE, STATING THE NAME 
OF THE VESSEL OR AIRCRAFT, THE PORT FROM WHICH SHE 
ARRIVED, THE DATE OF HER ARRIVAL, THE NAME OF THE 
IMPORTER, AND THE SERIAL NUMBER AND THE DATE OF 
ENTRY. THE COLLECTOR MUST ALSO KEEP A DAILY 
RECORD OF ALL ADDITIONAL DUTIES, TAXES AND OTHER 
CHARGES FOUND UPON LIQUIDATION, AND NOTICE SHALL 
PROMPTLY BE SENT TO THE INTERESTED PARTIES.” 
I 
SEC 24. Section 2001 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 2001, Esfablishmenf of Bonded Manufacturing Warehouses. - 
All articles manufactured in whole or in part of imported materials, 
and intended for exportation without being charged with duty, shall, 
in order to be so manufactured and exported, be made and 
manufactured in manufacturing warehouses under such rules and 
regulations as the Commissioner of Customs with the approval of 
the Secretary of Finance, shall prescribe; Provided, That the 
manufacturer of such articles shall first file a satisfactory bond for 
the faithful observance of all laws, rules and regulations applicable 
thereto; 
PROVIDED 
FURTHER, 
THAT 
BONDED 
MANUFACTURING WAREHOUSES SHALL LIKEWISE BE 
SUBJECT TO THE PROVISIONS UNDER TITLE V, PART 1 OF 
THIS CODE, AS AMENDED; PROVIDED FINALLY, THAT THESE 
REQUIREMENTS 
SHALL 
EXTEND 
TO 
REGISTERED 
LOCATORS OPERATING UNDER THE CHARTERS OF THE 
PHILIPPINE ECONOMIC ZONE AUTHORITY, THE SUBIC BAY 
METROPOLITAN AUTHORITY, AND OTHER FREEPORTS AND 
ECOZONES.” 
SEC 25. Section 2002 of the TCCP, as amended, is hereby further amended to 
read as follows: 
”Sec. 2002. Exemption from Duty. - 
a . x x x  
b. Any imported material used in the manufacture of such articles, 
and any package, covering, brand and label used in putting up the 
same may, under the regulation prescribed by the Commissioner, 
with the approval of the Secretary of Finance, be conveyed without 
the payment of duty into any bonded manufacturing warehouse, 
and imported articles may, under the aforesaid regulations, be 
transferred without the payment of duty from any bonded 
warehouse into any bonded manufacturing warehouse, or to duly 
9 


accredited sub-contractors of manufacturers who shall process the 
same into finished products back to the bonded manufacturing 
warehouse, therefrom to be exported; but this privilege shall not be 
held to apply to implements, machinery, or apparatus to be used in 
the construction or repair of any bonded manufacturing warehouse; 
Provided however, That the materials transferred or conveyed into 
any bonded manufacturing warehouse shall be used in the 
manufacture of articles for exportation within a period of THIRTY 
(30) DAYS from the date of such transfer or conveyance into the 
bonded manufacturing warehouse, which Ceriod may for sufficient 
reasons be further extended for not more than THIRTY (30) DAYS 
by the Commissioner. x x x” 
SEC 26. Section 2005 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 2005. Bonded Smelfiiig Warehouses. - The plants of 
manufacturers engaged in smelting or refining, or both, of ores and 
crude metals, may, upon the filing of CASH bonds, be designated 
as bonded smelting warehouses. Ores or crude metals may be 
removed from !he vessel or aircraft in which imported, or from a 
bonded warehouse, into a bonded smelting warehouse without the 
payment of duties thereon, and there smelted or refined, or both, 
together with ores or crude metals of home or foreign productions; 
Provided, That the CASH BOND SHALL BE IN a sum equal in 
amount to the regular duties which would have been payable on 
such ores and crude metals if entered for consumption at the time 
of their importation, and the several charges against such bond 
shall be cancelled upon the exportation or delivery to a bonded 
manufacturing warehouse established under Section twenty 
hundred and one hereof of a quantity of the same kind of metal 
equal to the quantity of metal producible from the smelting or 
refining, or both, of the dutiable metal contained in such ores or 
crude metals, due allowance being made of the smelter wastage as 
ascertained from time to time by the Commissioner; Provided 
further, That the said metals so producible or any portion thereof, 
may be withdrawn for RE-EXPORTATION UPON PROOF THAT 
THE ORDER TO IMPORT THE SUBJECT METALS HAS BEEN 
’ 
CANCELLED AND THAT THE METALS TO BE WITHDRAWN 
DO NOT AMOUNT TO MORE THAN FIFTY PERCENT (50%) OF 
THE TOTAL INVENTORY OF THE BONDED SMELTING 
WAREHOUSE; Provided further, That on the arrival of the ores or 
crude metals at such establishments they shall be sampled and 
assayed according to commercial methods under the supervision of 
proper government officials; Provided further, That all labor 
performed and services rendered pursuant to this Section shall be 
under the supervision of the proper customs official and at the 
expenses of the manufacturer; Provided further, That all regulations 
for carrying out the provisions of this Section shall be prescribed by 
the Commissioner with the approval of the department head; 
Provided FURTHER, That,the several charges against the bond of 
any smelting warehouse established under the provisions of this 
Section may be cancelled upon the exportation or transfer to a 
bonded manufacturing warehouse from any other bonded smelting 
warehouse established under this Section of a quantity of the same 
kind of metal, in excess of that covered by open bonds, equal to the 
amount of metal producible from the smelting or refining, or both, of 
the dutiable metal contained in the imported ores or crude metals, 
due allowance being made of the smelter wastage as ascertained 
10 


from time to time by the Commissioner with the approval of the 
department 
head; 
PROVIDED 
FINALLY, THAT BONDED 
SMELTING WAREHOUSES SHALL LIKEWISE BE SUBJECT TO 
THE PROVISIONS UNDER TITLE V, PART I OF THIS CODE, AS 
AMENDED.” 
SEC 27. Section 2503 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 2503. Undervaluation, Misclassificafhn, arid Misdeclarafion in 
.Enfry. - When the dutiable value of imported articles shall be so 
declared and entered that the duties based on the declaration of 
the importer on the face of the entry would be less by ten percent 
(10%) than should be legally collected, or when the imported 
articles shall be so described and entered that the duties based on 
the importer’s description on the face of the entry would be less by 
ten percent (10%) than should be legally collected, or when the 
imported articles shall be so described and entered that the duties 
based on the importer’s description on the face of the entry would 
be less ten percent (10%) than should be legally collected based 
on the tariff classification, of when the dutiable weight, 
measurement or quantity of imported articles is found upon 
examination to exceed by ten percent (10%) or more than the 
entered weight, measurement or quantity, a surcharge shall be 
collected from the importer in an amount of not less than the 
difference between the full duty and the estimated duty based upon 
the declaration of the importer, nor more than twice of such 
difference; Provided, That an undervaluation, misdeclaration in 
weight, measurement or quantity of more than thirty percent (30%) 
between the value, weight, measurement or quantity declared in 
the entry, and the actual value, weight, quantity, or measurement 
shall constitute a prima facie evidence of fraud penalized under 
Sections 2530 AND 3602 of this Code; Provided further, That any 
misdeclared or undeclared imported article I items found upon 
examination shall ipso facto be forfeited in favor of the Government 
to be disposed of pursuant to the provisions of this Code.” 
SEC 28. Section 2603 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 2603. Mode of Sale. - In the absence of any special 
provision, subject to the provisions of Section 2601 above provided, 
property subject to sale by the customs authorities shall be sold at 
public auction within FIFTEEN (15) DAYS after ten (IO) days notice 
of such sale shall have been PUBLISHED IN AT LEAST TWO (2) 
NEWSPAPERS OF GENERAL CIRCULATION, POSTED ON THE 
OFFICIAL WEBSITE OF THE BUREAU OF CUSTOMS, AND 
conspicuously posted at the FRONT ENTRANCE OF THE 
CUSTOMS HOUSE.” 
SEC 29. Section 3601 of the TCCP, as amended, is hereby further amended to 
read as follows: 
“Sec. 3601. Unlawful Importation. - Any person who shall 
fraudulently import or bring to the Philippines, or assist in so doing, 
any article, contrary to law or receive, conceal, buy, sell, or in any 
way facilitate the transportation, concealment or sale of such article 
after importation, knowing the same to have been imported 


contrary to law, shall be guilty of smuggling and shall be punished 
with: 
1. A fine IN AN AMOUNT EQUAL TO THE APPRAISED VALUE 
PLUS FIFTY PERCENT (50%) THEREOF and imprisonment of not 
less than six (6) months and one (1) day nor more than four (4) 
years, if the appraised value, to be determined in the manner 
prescribed under 'this Code, including duties and taxes, of the 
article unlawfully imported exceeds FIVE THOUSAND PESOS 
(p5,OOO.OO) 
but does not exceed Fifty Thousand Pesos 
(P50,OOO.OO); 
2. A fine IN AN AMOUNT EQUAL TO THE APPRAISED VALUE 
PLUS FIFTY PERCENT (50%) THEREOF and imprisonment of not 
less than FOUR (4) YEARS and one (1) day nor more than eight 
(8) years, if the appraised value, to be determined in the manner 
prescribed under this Code, including duties and taxes, of the 
articles unlawfully imported is more than FIFTY Thousand Pesos 
(P50,000.00) but does not exceed One Hundred Fifty Thousand 
Pesos (PI 50,000.00); 
3. A FINE IN THE AMOUNT EQUAL TO THE APPRAISED 
VALUE 
PLUS 
FIFTY PERCENT (50%) 
THEREOF AND 
IMPRISONMENT OF NOT LESS THAN EIGHT (8) YEARS AND 
ONE (1) DAY NOR MORE THAN TWELVE (12) YEARS, IF THE 
APPRAISED VALUE, TO BE DETERMINED IN THE MANNER 
PRESCRIBED UNDER THIS CODE, INCLUDING DUTIES AND 
TAXES, 
OF 
THE 
ARTICLE 
UNLAWFULLY 
IMPORTED 
EXCEEDS 
ONE 
HUNDRED 
FIFTY 
THOUSAND 
PESOS 
(P150,OOO.OO) BUT DOES NOT EXCEED TWO HUNDRED FIFTY 
THOUSAND PESOS (P250,OOO.OO); 
4. A FINE IN THE AMOUNT EQUAL TO THE APPRAISED 
IMPRISONMENT OF NOT LESS THAN W f L V f  (T2) YEARS 
AND ON€ (7) DAY NOR MORE THAN FIFTEEN (15) YEARS, IF 
THE APPRAISED VALUE, TO BE DETERMINED IN THE 
MANNER PRESCRIBED UNDER THIS CODE, INCLUDING 
DUTIES AND TAXES, OF THE ARTICLE UNLAWFULLY 
IMPORTED EXCEEDS TWO HUNDRED FIFTY THOUSAND 
PESOS 
(P250,OOO.OO) 
BUT 
DOES 
NOT 
EXCEED 
FIVE 
HUNDRED THOUSAND PESOS (P500,OOO.OO); 
5. A FINE IN THE AMOUNT EQUAL TO THE APPRAISED 
VALUE 
PLUS 
FIFTY PERCENT (50%) THEREOF 
AND 
IMPRISONMENT OF NOT LESS THAN FIFTEEN (15) YEARS 
AND ONE (I) DAY NOR MORE THAN TWENTY (20) YEARS, IF 
THE APPRAISED VALUE, TO BE DETERMINED IN THE 
MANNER PRESCRIBED UNDER THIS CODE, INCLUDING 
DUTIES AND TAXES, OF THE ARTICLE UNLAWFULLY 
IMPORTED EXCEEDS FIVE HUNDRED THOUSAND PESOS 
(P500,OOO.OO) BUT DOES NOT EXCEED ONE MILLION 
PESOS(P1 ,000,000.00); 
6. A FINE IN THE AMOUNT EQUAL TO THE APPRAISED 
VALUE PLUS FIFTY PERCENT (50%) THEREOF AND LIFE 
IMPRISONMENT, 
IF THE 
APPRAISED VALUE, 
TO 
BE 
DETERMINED IN THE MANNER PRESCRIBED UNDER THIS 
CODE, INCLUDING DUTIES AND TAXES, OF THE ARTICLE 
VALUE 
PLUS 
FIFTY PERCENT (50%) THEREOF AND 
I2 


UNLAWFULLY IMPORTED EXCEEDS ONE MILLION PESOS 
(P1,000,000.00); 
7. The penalty of prision mayor TO RECLUSION TEMPORAL shall 
be imposed when the crime of serious physical injuries shall have 
been committed and the penalty of reclusion perpetua [to death] 
shall be imposed when the crime of homicide shall have been 
committed by reason or on the occasion of the unlawful 
importation. 
"In applying the above scale of penalties, if the offender is an alien 
[and the prescribed penalty is not death], he shall be deported after 
serving the sentence without further proceedings of deportation. If 
the offender is a government official or employee, the penalty shall 
be the maximum as hereinabove prescribed and the offender shall 
suffer an additional penalty of perpetual disqualification from public 
office, to vote and participate in any public election. 
"x x x." 
SEC 30. Section 3603 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 3603. Failure to Reporf Fraud. - Any master, pilot in 
command or other officer, owner or agent of any vessel or aircraft 
trading with or within the Philippines and any employee of the 
Bureau of Customs who, having cognizance of any fraud on the 
customs revenue, shall fail to report all information relative thereto 
to the Collector as by law required, shall be punished by a fine of 
not 
LESS 
THAN 
ONE 
HUNDRED THOUSAND PESOS 
(PlO0,OOO.OO) BUT NOT MORE THAN ONE MILLION PESOS 
(Pl,OOO,OOO.OO) AND IMPRISONMENT OF NOT LESS THAN 
EIGHT (0) YEARS BUT NOT MORE THAN TWELVE (12) YEARS. 
If the offender is an alien, he shall be deported aRer serving the 
sentence. If the offender is a public official or employee, he shall 
suffer additional penalty of perpetual disqualification to hold public 
office, to vote and to participate in any election." 
SEC 31. Section 3604 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 3604. Statutory Offenses of Officials and Employees. - Every 
official, agent or employee of the Bureau or of any other agency of 
the government charged with the enforcement of the provisions of 
this Code, who is guilty of any delinquency herein below indicated 
shall be punished with a fine of not LESS THAN ONE HUNDRED 
THOUSAND PESOS (PlOO,OOO.OO) BUT NOT MORE THAN ONE 
MILLION PESOS (Pl,OOO,OOO.OO) AND IMPRISONMENT OF NOT 
LESS THAN EIGHT (8) YEARS BUT NOT MORE THAN TWELVE 
(12) YEARS and perpetual disqualification to hold public office, to 
vote and to participate in any public office election: 
(a) xxx." 
SEC 32. Section 3605 of the TCCP, as amended, is hereby further amended to 
read as follows: 
"Sec. 3605. Concealment or Destruction of Evidence of Fraud. - 
: 
Any person who willfully conceals or destroys, any invoice, book or 
13 


paper relating to any article liable to duty after an inspection thereof 
has been demanded by the Collector of any collection district or at 
anytime conceals or destroys any such invoice, book or paper for 
the purpose of suppressing any evidence of fraud therein 
contained, shall be punished with a fine of not LESS THAN ONE 
HUNDRED THOUSAND PESOS (PlOO,OOO.OO) BUT NOT MORE 
THAN 
ONE 
MILLION 
PESOS 
(Pl,OOO,OOO.OO) 
AND 
IMPRISONMENT OF NOT LESS THAN EIGHT (8) YEARS BUT 
NOT MORE THAN TWELVE (12) YEARS.” 
I 
SEC 33. Section 3606 of the TCCP. as amended, is hereby further amended to 
read as follows: 
“Sec. 3606. Affixing Seals. - Any person who, without authority 
affixes or attaches a customs seal, fastening, or mark or any seal, 
fastening or mark purporting to be customs seal, fastening or mark 
to any vessel, vehicle on land, sea or air, warehouse, or package, 
shall be punished with a fine of not LESS THAN ONE HUNDRED 
THOUSAND PESOS (PlO0,OOO.OO) BUT NOT MORE THAN ONE 
MILLION PESOS (Pl,OOO,OOO.OO) AND IMPRISONMENT OF NOT 
LESS THAN EIGHT (8) YEARS BUT NOT MORE THAN TWELVE 
(12) YEARS. I f  the offender is an alien, he shall be deported after 
serving the sentence. If the offender is a public official or employee, 
he shall suffer an additional penalty of perpetual disqualification to 
hold public office, to vote and to participate in any election.” 
SEC 34. Separability Clause. Any portion or provision of this Act that may be 
declared unconstitutional or invalid shall not have the effect of nullifying other 
portions and provisions hereof as long as such remaining portion or provision can 
still subsist and be given effect in their entirety. 
SEC 35. Repealing Clause. All other laws, decrees, executive orders, 
proclamations and administrative regulations, or parts thereof consistent herewith 
are hereby repealed or modified accordingly. 
SEC 36. Effectivity. This Act shall take effect fifteen (15) days after its 
publication in at least two (2) national papers of general circulation. 
Kpproved, 
I4