6 Jan.

2015
Commissioner John Phillip P. Sevilla
Bureau of Customs
Manila
Dear Commissioner Sevilla:
We have received reports and complaints from our members regarding the implementation of the
BOC stuffing policy as contained in Sec. 16 of CMO 22-2010 or the Revised Customs Operations
Manual.
While the BOC is merely reviving an existing policy that has not been implemented, we have serious
misgivings about it, as it presents another opportunity for graft and corruption. Inspection may be
random, but will still require signatories that pose situations for table certification due to the
administrative and technical costs and difficulties of implementing this policy.
As the Commissioner is aware, inspections and monitoring stuffing of containers require tremendous
resources if the BOC is to do this well and corruption-free. Unfortunately, the Customs Container
Control Division which handles this task only has about 15 plantilla staff and reportedly another 15
on call. This will be no match to the thousands of containers that are shipped daily. Because the
Bureau itself admitted to insufficient manpower and communications facilities for this role, pushing
this can only mean imposing another non-tariff barrier that will hurt our job- and dollar-generating
capacity.
On the other hand, if the purpose of the policy is to ascertain the legitimacy of the exporter and his
goods, please note that there are other existing BOC measures to get the same result. These include
strict implementation of commodity clearances and the Client Profile Registration System (CPRS)
under which an annual plant inspection is being conducted. Otherwise, we know of no other
country especially in ASEAN that implements this policy simply because they see no benefit from
such.
Conducting such inspections will likewise contribute to the shipment delays and rising costs that
exporters are forced to deal with because of congestion. Consider further that containers are piling
up already and the queue to be served first is already a governance nightmare, aside from the
logistics issues involved.
Equally important is the point that this is a non-revenue activity anyway. It will only drain the BOC of
resources that otherwise can help achieve revenue targets. Even in the short term, this will cost the
economy and will not be commensurate with BOCs intentions for this policy, considering the
safeguards that are already in place.

International Trade Complex, Roxas Blvd., cor. Sen. Gil Puyat Ave., Pasay City
Tel: 833-2531 to 34; Fax: 831-3707; E-mail: advocacy@philexport.ph

Other Issues
There are other gray areas that have to be addressed for transparency and trade facilitation
purposes:
1. BOC district officers are unaware of this policy, based on reports from our exporters in the
regions.
2. Will there be BOC personnel available even at night time, holidays and weekends when
stuffing can take place?
Relevant to this point, has there been a system that was set up to facilitate the deployment
of BOC personnel especially in the regions? How will this be administered? How long is the
waiting time for exporters before a BOC personnel gets to the factory for the inspection?
What are the interfaces to the exporters to follow up requests for presence / certification of
sealing by BOC personnel?
Many of our members are small and medium companies with very little or no margin in the
costing and limited factory/warehouse space to store merchandise/detain containers and
chassis (the latter being very costly), as companies await the arrival of BOC personnel.
Lately, containers are sealed round the clock to better cope with the massive increase in
trucking charges and the frequently revised truck bans/container terminal acceptance
timings/etc. at the ports.
3. It may take hours to verify the quantity and kind of cargo if properly done. Otherwise, it is
pointless. As matters stand, Bills of Lading (B/L) specify that the loads are "based on
Shipper's Load and Count". This has been sufficient for shipments anywhere in the world
thus far.
4. The BOC personnel is supposed to witness the proper sealing of the container as a final step
in this process. However, for some shipments, the container cannot be sealed after the
cargoes are loaded because it needs to be fumigated and aerated after 24 hours. Will the
BOC personnel stay or will this need another appointment?
5. What will be an exporters recourse to compensation if a shipment deadline is missed due to
a failure on the BOC's part? Many shipments carry daily or weekly penalties in the contracts,
as high as 10% on the first day of unauthorized delay. This would put many companies in
the red, especially those producing low-cost products. This may result in many businesses
that will close, leading to loss of jobs and livelihood.
Further, please note that most sales contracts for export are negotiated months ahead of
shipment (6 to 9 months) and the quotations would not have included this new
procedure/risk of delay.
6. Many seasoned exporters have already been certified by accredited Third Parties for the
USA C-TPAT (Customs-Trade Partnership Against Terrorism) with strict procedures as to
access to containers and controls. These include security, stuffing and sealing details.
Although there is a provision for Customs input at origin, this policy is not specified. Such
system has been working well, with many having already been certified by US Customs
personnel from the Embassy here.

7. We have repeatedly heard Customs/the Commissioner promoting trade facilitation which

could be a competitive advantage for us especially as the ASEAN integration is completed
this year. The E2M is in fact a move towards this direction. But this policy is a step back to
the campaign to improve cross border procedures to move as much trade as possible.
We shall be pleased to work with a BOC technical team if needed to address this matter.
In conclusion, we see that at this point, we can only count the problems for both implementers and
private sector stakeholders, especially MSMEs who will again be the victims. In this light and until
the economic benefits can be clearly identified, may we respectfully recommend the status quo
prior to the January 15 implementation of such policy.
Your positive reply will go a long way in supporting the industry which is struggling to survive local
and foreign competition to save jobs and lives.
Thank you for your usual attention and support.
Very truly yours,

Sergio R. Ortiz-Luis Jr.

President

Cc: Hon. Gregory L. Domingo

Secretary Department of Trade and Industry
Mr. Guillermo Luz
Co-chair National Competitiveness Council