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Customs Modernization and Tariff Act (CMTA) – RA 10863

The Customs Modernization and Tariff Act (CMTA, RA 10863) modernizes Philippine customs law and aligns it with the Revised Kyoto Convention—the International Convention on Harmonization and Simplification of Customs Procedures (IHSC).

📌 Salient Provisions​

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1. Declarant Provision​

  • Grants the importer the right to declare goods without needing a Licensed Customs Broker.
  • ⚠️ Note: As of now, there are no Implementing Rules and Regulations (IRR) for this provision.

2. De-minimis Provision​

  • Previously: ₱10 threshold under the Tariff and Customs Code of the Philippines (TCCP).
  • Now: Raised to ₱10,000 at FCA Value (Free Carrier Value).

📌 Salient Provisions (Continued)​

3. Technical Smuggling​

  • The CMTA now legislates imprisonment for technical smuggling offenses.
  • Includes acts such as:
    • Misclassification
    • Misdeclaration
    • Undervaluation

4. Authorized Economic Operator (AEO)​

  • Introduced as part of the World Customs Organization (WCO) SAFE Framework.
  • Recognizes trusted importers/exporters who maintain strong compliance and security systems.
  • Benefits include simplified procedures and faster clearance.

📖 Scope of the CMTA​

The CMTA is the primary law governing Importation and Exportation in the Philippines.

It ensures:

  • Revenue collection through customs duties and taxes.
  • Public safety, via customs police enforcement against:
    • Smuggled goods
    • Harmful and illegal items (e.g., dangerous drugs)
  • Cooperation with other government agencies for enforcement.

⚖️ Administrative and Judicial Proceedings​

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Under the CMTA, two main cases may arise:

  1. Protest Case

    • Issues involving:
      • Valuation
      • Classification
      • Rules of Origin (ROO)
      • Or a combination of the above

  2. Forfeiture Case

    • Involves the illegality of the shipment

Administrative Proceedings:

  • Start at the Bureau of Customs (BOC).

Judicial Proceedings:

  • When appealed, the case is elevated to the Court of Tax Appeals (CTA).

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