Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
Title: Introduction to Warehousing
Module No. 1
I.
II.
Introduction
Learning Objectives
1. Understand the process in opening CBW’s
2. Differentiate the types of warehouses
3. Application of transportation bond and the other types of bond
III.
Topics and Key Concepts
BASICS OF CUSTOMS BONDED WAREHOUSE OPERATIONS
Warehouse – A structure or room for the storage of merchandise or commodities.
(www.merriam-webster.com)
Ordinary Warehouse vs. Customs Bonded Warehouse (CBW)
o Main Distinction:
▪ An Ordinary Warehouse is not subject to Customs control whereas the
Ordinary CBW is under Customs Control.
▪ The Bureau shall, for customs purposes exercise control over, direct and
manage CBW and CFWs pursuant to Section 303 of the CMTA and
likewise over the goods stored therein pursuant to Section 301 of the
CMTA (Section 806, CMTA)
•
Customs Bonded Manufacturing Warehouse (CBMW)
o Imported articles are manufactured and intended for exportation
o Rules and regulations to be prescribed by the Commissioner subject to the approval
of Secretary, DOF
•
Responsibility of Operators
o In case of loss on articles stored, operator is responsible for payment of D&T
o gov’t assumes no legal responsibility in respect to safekeeping of stored articles in
CBW
Validity of License to Operate is 2 years except for ICBW which is 3 years
•
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
•
Operators shall pay annual supervision fee as fixed by the Commissioner
o CCBW/ICBW/PuBW/Duty-free: P250,000 and every branch of duty-free P50,000
•
Bonded Manufacturing Warehouse
o Small industry/enterprise
P 50,000.00
o Medium industry/enterprise
100,000.00
o Large industry/enterprise
250,000.00
Where:
a) Small industries - has total assets of P500,000 but less than P5.0 million;
b) Medium industries – with total assets of P5.0 million but less than P20.0 million
c) Large industries – with total assets of P20.0 million and over. (CMO 71-91)
•
Pre-operating requirements upon approval of application: (1) payment of at least 25% of
annual supervision fee (2) designation of accountable officer (3) filing of performance bond
of P 200,000 (4) notarized designation of authorized signatory and customs broker (5)
posting of general warehousing bond (CMO 39-91)
Storage charges of public CBW
o Subject to arrangement between the importer and operator
o Such rates shall not be in excess of the customary charges fixed by the Collector
of the port.
•
DEFINITION OF TERMS
(CAO 1-2009)
•
Accessories – refer to articles which are neither raw materials nor supplies which enhance
the finished products to be exported
•
Semi- Finished products – are imported raw materials or articles that have undergone
processing which shall be used in the further manufacture of finished products for export.
They are also termed as “intermediate products”.
•
Supplies – refers to imported consumable and disposable indirect materials that are needed
in the manufacture, operation and production of a CBMW. Such materials are not included
in the formula of manufacture of the finished product and are not duty/tax-free unless
authorized by the BOI or exempted by the DOF.
•
Account Officer – is the customs personnel responsible for monitoring manually or through
electronic medium the performance of a CBW from importation to liquidation of
its imported raw materials to ensure compliance with customs rules and regulations.
•
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
•
Accountable Officer – is a responsible official of the CBW named and designated by the
operator as the person, other than himself, answerable and liable to BOC for all operational
aspects of the warehouse.
•
Automated Raw Materials Inventory and Management System (ARMIMS) – is a
computerized system to be adopted by the CBW operator as a tool to determine and monitor
the stock inventory of imported articles entered through warehousing of a CBW at any one
time.
•
Bar Coding System (BCS) – is the system that may be utilized by the BOC in identifying
and tracking certain imported articles entered for warehousing
•
Compliance Rate System (CRS) – is a procedure to be adopted by the BOC in assessing
the degree of compliance of a warehouse operator with relevant CBW rules and regulations
and in taking any action on the CBW’s license to operate or any extension thereof.
•
Automated Raw Materials Inventory and Management System (ARMIMS) – is a
computerized system to be adopted by the CBW operator as a tool to determine and monitor
the stock inventory of imported articles entered through warehousing of a CBW at any one
time.
•
Bar Coding System (BCS) – is the system that may be utilized by the BOC in identifying
and tracking certain imported articles entered for warehousing
•
Compliance Rate System (CRS) – is a procedure to be adopted by the BOC in assessing
the degree of compliance of a warehouse operator with relevant CBW rules and regulations
and in taking any action on the CBW’s license to operate or any extension thereof.
•
Raw Material Liquidation System (RMLS) – is an automated system to be adopted and
utilized by the BOC in determining the volume and value of the raw materials exported and
subject for liquidation, including the duties and taxes due on the allowable residues,
wastages, by-products and other portion of the imported articles entered through
warehousing, no longer usable for the manufacture of the articles to be exported
Wastage Valuation Database (WVDB) – is a bank of information and reference values
which shall be utilized by the BOC in assessing the taxes and duties in the allowable
residue/wastages/ by-products or other portion of the imported articles which can no longer
be used for the manufacture of the articles to be exported.
•
• Unauthorized Withdrawal
Is a violation of Customs law committed:
o When an imported material entered through the warehousing scheme and destined for
transit to a particular CBW, PEZA/ Freeport Locator, or from the CBW to the port or
airport for exportation, is brought to some places other than its intended destination
without any prior authority from the Collector having jurisdiction over the imported
goods;
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
o The act of directly transferring the imported materials to a licensed member or
subcontractor without passing through the physical facility of the CBW;
o Transfer of such materials to a non-licensed member or subcontractor
o Withdrawal of any material/ article stored in a CBW without duly processed withdrawal
or requisition slip;
o Unauthorized substitution of materials or finished products with local materials or
articles.
TYPES OF CUSTOMS BONDED WAREHOUSE (CBWs)
•
CBW may be classified as either manufacturing or non-manufacturing. (Section 802,
CMTA)
o Manufacturing CBWs may be of the following types:
a. Garments and Textiles Manufacturing Bonded Warehouse (GTMBW) is a
warehouse facility jointly licensed b the BOC and the GTIS through its
accreditation committee to import, receive and store garments, textiles, accessories,
and packaging materials for manufacture into finished products for export (CAO 12009).
b. Miscellaneous Manufacturing Bonded Warehouse (MMBW) is a warehouse facility
licensed by the BOC to import, receive, and store raw materials, accessories and
packaging materials, except garments and textiles, for manufacture into finished
products for export.
c. Customs Common Bonded Manufacturing Warehouse (CCBMW) is a warehouse
facility licensed by the BOC alone or jointly with GTIS for garment industry to
import, receive, and store raw materials, accessories, spare parts, supplies, and
packaging materials for the account of its accredited members for manufacture into
finished product for export.
d. Industry Specific Customs Bonded Warehouse (ICBW) – is a warehouse facility
duly licensed by the BOC to import under bond and under its name and account raw
materials except fibers, yarns fabrics and accessories for the manufacture of
garments for storage and subsequent sale/ transfer to the following where these shall
be manufactured into export products:
▪ Licensed Client/ End- User;
▪ Customs Bonded Manufacturing Warehouse;
▪ PEZA or Freeport Locator
o Non- manufacturing CBWs include:
a. Public Bonded Warehouse (PuBW) – is a warehouse facility licensed by the BOC
to receive and sore general cargoes for exportation, transfer to another CBW, PEZA
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
or Freeport Registered Enterprise, or for local consumption in the same state when
the cargoes were imported.
b. Private Bonded Warehouse (PrBW) – is a warehouse facility licensed by the BOC
to import, receive, store articles for its production intended for domestic
consumption, withdrawal of which shall be made only upon payment of duties and
taxes and other charges due thereon.
c. Airlines Customs Bonded Warehouse (ACBW) – a special type of CBW which
caters the needs of the international air carriers operating in the country.
d. Multinational Regional Bonded Warehouse (MRBW) – is a warehouse facility
licensed by the BOI in proper cases, to serve as a supply depot for the storage,
deposit, safekeeping of spare parts, components, semi-finished products, and raw
materials including packing, covering, putting up, marking, labeling, cutting, or
altering to customer satisfaction, mounting, and/ or packing into kits or marketable
lots thereof to fill up transactions and sales made by its officer or parent companies
and to serving as a storage of goods purchased locally by the home office of the
multinational for export abroad under the supervision of the BOC.
e. Customs Duty Free Shops (DFS) – includes facilities of Government owned (Duty
Free Philippines) or owned by private persons licensed by the BOC to receive, store
and sell various items (such as food items, chocolates, perfumes, alcoholic
beverages, tobacco products, etc.) inside their premises.
a) Customs Facilities and Warehouses (CFW) [Section 803, CMTA] shall include:
1.
2.
3.
4.
Container yard
Container freight station
Seaport warehouses
Airport warehouses
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
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Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
b) As to manner of designation of Customs Personnel
1. Ordinary Customs Bonded Warehouse – is the traditional warehouse wherein a
Customs Bonded Warehousing man, Senior Storekeeper, and CBW Guards, among
others, may be assigned to supervise the activities and transactions with the BOC.
2. Open Bonded System – is the operation of a duly licensed CBW wherein the
tracking, monitoring and accounting of imported goods entered conditionally free
under the CBW scheme is done by means of computer linkage, without the need of
assigning any customs personnel at the warehouse.
GENERAL PROVISIONS
The BOC is responsible for the licensing, supervision and control of all CBWs,
including its extension warehouses, licensed members and subcontractors. Subcontractors
located in PEZA or Free ports shall likewise be subject to monitoring by the BOC upon proper
coordination with the relevant agency concerned.
•
•
•
Extension warehouses – is a separate CBW facility granted by the BOC to an already
authorized CBW operator when the latter’s current warehousing facilities are no longer
sufficient to fully service the volume of its operations
Licensed Member – is a natural or juridical person licensed by the BOC alone, or jointly
with the GTIS for garments industry, to be a member of a CCBMW
Licensed Subcontractor – is a person or company licensed by the BOC, and GTIS in case
of garments, to undertake or perform, for a definite period, certain manufacturing
operations or activities incidental to the manufacture of bonded raw materials into finished
products in behalf of a licensed CBW due to the latter’s insufficiency of operational
facilities or lack of material time to meet export commitment.
A CBW and variants thereof include the surrounding premises within its
perimeter fence per approved application, rooms, compartments, and other areas necessary and
exclusively used for sorting, processing, re-packing, and manufacturing imported raw materials
and finished products, by-products, wastages, rejects incident to such activities as applied for
and approved by the BOC. No other establishment shall be allowed thereat except upon proper
approval of the BOC and under such conditions as may be imposed by the BOC.
During the transaction period from the present system to the Open Bonded
Warehouse System, the BOC, shall, as far as practicable, institute new methods and techniques
in the supervision and control of CBWs. These shall include, but not limited to the
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
computerization of all CBW activities and transactions in order to render operational the Open
Bonded Warehouse System
TERMS AND CONDITIONS
•
Terms and Conditions of License to Operate a CBW
1. Imported raw materials, accessories, spare parts, labels, hangers, cartons, packing
materials and the like used in the manufacture of articles that are transferred to other
CBMW or licensed members or subcontractor for processing into finished products
and thereafter exported shall be exempt from payment of duties and taxes.
2. Goods entered for warehousing shall be exempt from duties and taxes within the
allowed period of storage unless withdrawn for consumption, exportation, or transit to
a free zone or another CBW, in which case, such withdrawal shall be subject to the
applicable rules and regulations on the liquidation of warehousing entry.
3. Imported articles may be withdrawn from the warehouse either for:
a)
b)
c)
d)
e)
f)
Manufacture into export products;
Repacking for distribution to foreign markets
Sale to CBMW;
Transfer to Subcontractor
Transfer to members of CCBMW
Domestic Consumption
o Those articles withdrawn for domestic consumption shall be subject to payment
of duties and taxes.
4. The visitorial power of the BOC shall extend to all CBWs, including their extensions,
licensed members, end-user/clients and subcontractors. In the case of end-user/ clients
and subcontractors located in PEZA or Freeport, the exercise of the BOC of its
visitorial power shall always be with prior notice to the locator/ enterprise concerned
and limited to a specific transaction through proper coordination with the government
agency concerned.
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
5. A CCBMW or ICBW shall likewise have an Examination and Storage Facility which
is a secured area with sufficient space for the inspection and subsequent storage and,
safekeeping of imported goods prior to their delivery to licensed members or licensed
client/ end-user, as the case may be. It shall also have the necessary logistical support
needed for the proper handling of such imported articles.
6. Examination and Storage Facility is a facility of a CCBMW and ICBW with sufficient
personnel and space for examination and storage of goods
7. The license to operate a CBW is personal to the warehouse and shall not be
transferred or assigned for whatever the reason.
8. A Licensed Extension Warehouse or a licensed subcontractor of a CBMW should
preferably be located within the Collection District where the main warehouse is
registered except a subcontractor located in the PEZA or Freeport Zone.
9. Any person, natural or juridical, found to be operating as a CBW without a valid
customs license, shall be barred from being granted any warehousing privileges.
10. Any misinterpretation, false statement or non-disclosure of any material information
required in any application shall be a ground for its disapproval without prejudice to
any administrative/ criminal charge as may be proper.
11. Any misinterpretation, false statement or non-disclosure of any required material
information discovered after the issuance of a license to operate a CBW shall be a
ground for the revocation/ cancellation of such license.
APPLICATION FOR ESTABLISHMENT OF A CBW
•
Application for license to operate as member, subcontractor or client/end-user shall
likewise be submitted to the Commissioner of Customs through the District Collector for
evaluation by the BWC.
•
If client/end-user or subcontractor is located within Free Zones (PEZA/ Freeport),
application must be submitted with the respective Free Zone Authority.
•
For MRBW, application shall be submitted through the following office/s whichever is
applicable:
o If the Multinational company has existing Regional or Area Headquarters (RHQ) or
Regional Operating Headquarters (ROHQ) – PEZA
o If the Multinational company has no RHQ/ROHQ – SEC through (Registration
Division of BOI)
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY
Republic of the Philippines
City of Olongapo
GORDON COLLEGE
Olongapo City Sports Complex, East Tapinac, Olongapo City
Tel. No. (047) 224-2089 loc. 314
Provided, the License for MRBW shall be held in abeyance until the Certificate of Registration
and License to Operate RHQ/ROHQ is issued by the SEC. (EO 226, as amended by RA 8756
implemented by its IRR).
Moratorium on Establishment of CBWs
o A moratorium is imposed on new applications of CBWs.
The moratorium shall not cover the following:
a) Application of CBMW (CMO 7-2008/CMO 9-2008);
b) Applications of members of CCBMW (CMO 7-2008);
c) Application for End-user of ICBW registered with BOI/PEZA/Freeport but must secure
clearance from OCOM (CMO 7-2008/ CMO 9-2008/ CMO 3-2011)
d) Application for MRBW (IRR RA 8756)
CUSTOMS WAREHOUSING | 2nd SEMESTER A.Y. 2020-2021
NOT FOR SALE | EXCLUSIVE FOR GORDON COLLEGE ONLY