Imposing The Mandatory Payment Of Container Security Fee In The Implementation Of The Non-Intrusive Container Inspection System (NCIS) Project Of The Bureau Of Customs And Creating A Trust Fund For The Use Thereof

MALACAÑAN PALACE
MANILA

BY THE PRESIDENT OF THE PHILIPPINES

EXECUTIVE ORDER No. 592

IMPOSING THE MANDATORY PAYMENT OF CONTAINER SECURITY FEE IN THE IMPLEMENTATION OF THE NON-INTRUSIVE CONTAINER INSPECTION SYSTEM (NCIS) PROJECT OF THE BUREAU OF CUSTOMS AND CREATING A TRUST FUND FOR THE USE THEREOF

WHEREAS, under Section 602 of the Tariff and Customs Code of the Philippines, as amended, the Bureau of Customs (BOC) is mandated to, among others, assess and collect lawful revenues from imported articles, prevent and suppress smuggling and other frauds against Customs, and exercise supervision and control over all import and export cargoes, landed or stored in piers, airports, terminal facilities, including container yards and freight stations, for the protection of government revenue;

WHEREAS, in the pursuit of trade facilitation and law enforcement, the BOC issued Customs Administrative Order (CAO) No. 1-2002 providing for the use of container x-ray machine as an alternative to actual physical examination to further speed up the examination of shipments and movement of cargoes;

WHEREAS, in line with such mandate, the BOC proposed...

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Summary of Executive Order No. 592:

Imposition of Container Security Fee (CSF):
- Mandatory CSF imposed on all import and export cargoes under Bureau of Customs (BOC) jurisdiction.
(Section 1, Section 2)
- CSF rates:
    - US$50 for 40-footer container
    - US$25 for 20-footer container or 20 equivalent units (TEUs)
    - Rates adjustable by BOC Commissioner as approved by NEDA Board.
(Section 2)

Utilization of CSF:
- 75% remitted to National Treasury for repayment of concessional loan from China for Non-Intrusive Container Inspection System (NCIS) Project, including interest and charges. After loan repayment, this 75% allocated to NCIS Trust Fund.
(Section 3a)
- 25% retained by BOC in NCIS Trust Fund for:
    - Maintenance and improvement of NCIS operation, including upgrades
    - Institutionalizing post-audit procedures and processes
    - Fraud and fraud-related investigations and prosecutions
    - Training and capability enhancement of NCIS personnel
    - Other activities to enhance NCIS effectiveness and efficiency
(Section 3b)

NCIS Trust Fund:
- Established and sourced from 25% CSF portion retained by BOC
- Permanent committee to monitor and evaluate Trust Fund activities and balances
(Section 4)

Non-compliance:
- Failure to follow directives subjects concerned officials to administrative sanctions
(Section 5)

Effectivity:
- Executive Order takes effect immediately upon publication in national newspaper
(Section 6)