Business Bayani PH

The 2022 Time Release Study (TRS) conducted by the Bureau of Customs (BOC) offers insights into customs delays in the Philippines and recommends solutions to address these issues. 

The study emphasizes the importance of collaboration between stakeholders and the need for customs digitalization and system integration to streamline import and export processes.

The TRS, initiated in 2019, measures the time required for the release and clearance of goods, aiming to identify operational bottlenecks and suggest measures to facilitate trade. 

It primarily focuses on containerized imports and exports processed through seaports from July 26 to August 3, 2022, covering both regulated and non-regulated goods.

Challenges leading to delays

Various factors contribute to customs delays in the Philippines. Post-customs processing delays, caused by factors like the Terminal Appointment Booking System and slow truck movement, are a significant issue for imports. ATL issuance, clearance, and vessel loading for exports also extend processing times.

The study highlighted the impact of “orange” flagged import entries under BOC’s selectivity system, which are often delayed by long x-ray queues. 

Additionally, delays in value verification processes result from broker-related issues, such as missing supporting documents and required licenses or permits.

Intermittent internet connections affect the efficiency of BOC’s Electronic-to-Mobile System and Customer Care Portal System. 

The practice of customs brokers submitting and transporting documents, along with the lack of direct transmission of permits from government agencies to BOC, further contribute to processing delays.

Modernization efforts

The study recognized the efforts of port operators to modernize systems but noted that the sheer volume of shipments in Manila poses a challenge. Capacity-building activities for BOC employees are essential to keep pace with modernization initiatives.

To address these issues, the study recommends enhancing digital customs processes and trade facilitation. 

Key recommendations include implementing an informed compliance program to foster collaboration between stakeholders and BOC, streamlining procedures, reducing delays, and ensuring clear communication of requirements and compliance.

Intensifying trade facilitation programs such as advance ruling and Authorized Economic Operator can promote efficient goods movement and reduce trade costs.

Despite automating 160 out of 166 customs processes, the study noted a lack of integration among various systems developed as part of modernization efforts. 

The Customs Processing System (CPS) under the Philippine Customs Modernization Project (PCMP) is proposed as a solution to unify and harmonize these systems. However, the implementation of the PCMP has been delayed, with no announcement regarding the procurement of the CPS.

The study also encourages the adoption of online payment methods and the active participation of government agencies in the national single window (NSW). Currently, 22 of 73 trade regulatory government agencies are part of the country’s NSW, known as TradeNet. To optimize its use, the study suggests onboarding all trade regulatory agencies to eliminate manual processing time.

Other key findings from the 2022 TRS

The study revealed varying timeframes for different stages of import and export processes at four BOC ports: Manila International Container Port (MICP), Cebu port, Cagayan De Oro port-Mindanao Container Terminal (CDO-MCT), and Davao port.

For import pre-customs processes, from vessel arrival to single administrative document (SAD) registration, the timeframes ranged from four days, 10 hours, and 29 minutes at MICP to two days, 21 hours, and one minute at Davao port.

Import customs processes, from the notice of arrival to portal upload, took one day, 18 hours, and 44 minutes at MICP and two days, 17 hours, and 31 minutes at Davao port.

Import post-customs processes, corresponding to cargo movement at the port terminal, varied from two days and five minutes at Cebu port to three days, 12 hours, and 49 minutes at MICP.

Overall, the import processing times, from vessel arrival to goods exiting the port terminal, were between seven and nine days for these ports.

For exports, customs process times, from the submission of export declaration to the issuance of the Authority to Load (ATL), ranged from eight hours and 29 minutes at Davao port to one day, six hours, and 36 minutes at Cebu port.

Export post-customs process times, from ATL issuance to vessel departure, varied from six minutes at Cebu port to eight days, one hour, and one minute at MICP.

The study noted both pre-customs and post-customs processes accounted for most of the time in import and export processing, while customs processing itself constituted a smaller portion.◼