REPUBLIC OF THE PHILIPPINES

DEPARTMENT OF FINANCE
BUREAU OF CUSTOMS
MANILA 1099

CUSTOMS ADMINISTRATIVE ORDER (CAO)

NO. ________________

SUBJECT: CLEARANCE FOR GOODS UNDER THE INFORMAL ENTRY

PROCESS

Introduction. This CAO implements Section 402, Chapter 1, Title IV, Section 800,
Chapter 1, Title VIII and other relevant provisions of Republic Act No. 10863,
otherwise known as the Customs Modernization and Tariff Act (CMTA).

Section 1. Scope. This CAO applies to all importations cleared through the Informal
Entry Process whether or not subject to payment of duties and taxes.

Section 2. Objectives.

2.1. To prescribe Customs formalities on the clearance of imports

under Informal Entry Process consistent with international
standards and customs best practices.

2.2. To identify and segregate the importation of personal and

household effects and other qualified non–commercial goods, not
intended for sale and commerce, from the mainstream of
commercial importation of highly dutiable goods intended for
commercial processes.

2.3. To facilitate customs clearance of Informal Entry Process without

prejudice to the Bureau’s other functions of revenue collection,
and prevention of smuggling and other customs fraud.

2.4. To have a systematic application on the clearance of imports under

Informal Entry Process making full use of Information and
Communications Technology (ICT) enabled customs cargo
clearance system.

Section 3. Definition of Terms. For purposes of this CAO, the following terms
shall be defined as follows:

3.1. Air Waybill (AWB) – shall refer to a transport document for

airfreight used by airlines and international freight forwarders

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 which specify the holder or consignee of the bill who has the right
to claim delivery of the goods when they arrive at the port of
destination. It is a contract of carriage that includes carrier
conditions, such as limits of liability and claims procedures. In
addition, it contains transport instructions to airlines and carriers,
a description of the goods, and applicable transportation charges.1

3.2. Bill of Lading (BL) – shall refer to a transport document issued

by shipping lines, carriers and international freight forwarders or
non-vessel operating common carrier for water-borne freight. The
holder or consignee of the bill has the right to claim delivery of the
goods at the port of destination. It is a contract of carriage that
includes carrier conditions, such as limits of liability and claims
procedures. In addition, it contains transport instructions to
shipping lines and carriers, a description of the goods, and
applicable transportation charges.2

3.3. Bureau – shall refer to the Bureau of Customs.

3.4. Clearance – shall refer to the completion of customs and other

government formalities necessary to allow goods to enter for
consumption, warehousing, transit or transshipment, or to be
exported or placed under another customs procedure.3

3.5. Commercial Quantity – shall refer to the quantity for a given

kind or class of articles, which are in excess of what is compatible
with and commensurate to the person’s normal requirements for
personal use.4

3.6. Conditionally Tax and/or Duty-Exempt Importation – shall

refer to goods exempt from the payment of import duties and/or
taxes upon compliance with certain formalities prescribed under
pertinent customs issuances.5

3.7. Free Carrier (FCA) – shall mean that the seller delivers the goods
to the carrier or another person nominated by the buyer at the
seller’s premises or another named place. The parties are well
advised to specify clearly as possible the point within the named
place of delivery, as the risk passes to the buyer at that point.6

3.8. Free On Board (FOB) – shall mean that the seller delivers the
goods on board the vessel nominated by the buyer at the named
port of shipments or procures the goods already delivered. The

1
cf. CMTA Law, Title I, Chapter 2. Section 102 (d).
2
cf. CMTA Law, Title I, Chapter 2. Section 102 (h).
3
cf. CMTA Law, Title I, Chapter 2. Section 102 (k).
4
cf. DOF DO 57-2011, 2-b
5
cf. CMTA Law, Title VIII, Chapter 1. Section 800, first par.
6
cf. CAO No. 02-2016 on “Imported Goods with De Minimis Value Not Subject to Duties and Taxes”,
Section 3.3.

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 risk of loss of or damage to the goods passes when the goods are
on board the vessel, and the buyer bears all costs from that
moment onwards.7

3.9. Goods – shall refer to articles, wares, merchandise and any other
items which are subject of importation or exportation.8

3.10. Goods Declaration – shall refer to a statement made in a

manner prescribed by customs laws, rules and regulations for the
entry or admission of imported goods.9

3.11. Goods of a Commercial Nature – shall refer to goods that are

intended to be used solely for commercial purpose, including but
not limited to, sale, lease, hire or barter.

3.12. Household Effects – shall refer to furniture, dishes, linens,

libraries and similar household furnishing for personal use10.

3.13. Informal Entry Process – shall refer to the clearance process

for imported goods with FOB or FCA value of less than fifty
thousand pesos (P50,000.00) and personal and household effects
or goods, not in commercial quantity and other shipments covered
under Section 4 of this CAO.

3.14. Lodgement – shall refer to the registration of a goods declaration

with the Bureau.11

3.15. Non-Commercial Goods – shall refer to goods, not otherwise

falling under the definition of personal and household effects, that
are not intended to be used for any commercial purposes,
including sale, lease, hire or barter.

3.16. Personal Effects – shall refer to commodities whether new or

used, for personal use or consumption and not for commercial
purposes, such as wearing apparel, personal adornments,
electronic gadgets, toiletries, or similar items12.

3.17. Prohibited Importation – The importation of the following

goods are prohibited:

a. Written or printed goods in any form containing any matter

advocating or inciting treason, rebellion, insurrection, sedition
against the government of the Philippines, or forcible

7
cf. CAO No. 02-2016 on “Imported Goods with De Minimis Value Not Subject to Duties and Taxes”,
Section 3.4.
8
cf. CMTA Law, Title I, Chapter 2, section 102
9
cf. CMTA Law, Title I, Chapter 2, section 102 (y); cf. RKC, General Annex, Chapter 2 ”Definitions”,
E19/F8
10
cf. Customs Border Protection Info Center
11
cf. CMTA Law, Title I, Chapter 2, section 102 (dd)
12
cf. CAO 5-2016

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 resistance to any law of the Philippines, or written or printed
goods containing any threat to take the life of, or inflict bodily
harm upon any person in the Philippines;

b. Goods, instruments, drugs and substances designed,

intended or adapted for producing unlawful abortion, or any
printed matter which advertises, describes or gives direct or
indirect information where, how or by whom unlawful
abortion is committed;

c. Written or printed goods, negatives or cinematographic films,

photographs, engravings, lithographs, objects, paintings,
drawings or other representation of an obscene or immoral
character;

d. Any goods manufactured in whole or in part of gold, silver or

other precious metals or alloys and the stamp, brand or mark
does not Indicate the actual fineness of quality of the metals
or alloys;

e. Any adulterated or misbranded food or goods for human

consumption or any adulterated or misbranded drug in
violation of relevant laws and regulations;

f. Infringing goods as defined under the Intellectual Property

Code and related laws; and

g. All other goods or parts thereof which importation are

explicitly prohibited by law or rules and regulations issued by
the competent authority.13

3.18. Regulated Importation – shall refer to the goods which are

subject to regulation shall be imported only after securing the
necessary goods declaration, clearances, licenses, and any other
requirements, prior to importation, submission of requirements
after arrival of the goods but prior to release from customs custody
shall be allowed but only in cases provided for by governing laws
or regulations14.

3.19. Restricted Importation – Except when authorized by law or

regulation, the importation of the following restricted goods are
prohibited:

a. Dynamite, gunpowder, ammunitions and other explosives,

firearms and weapons of war, or parts thereof;

b. Roulette wheels, gambling outfits, loaded dice, marked cards,

machines, apparatus or mechanical devices used in gambling

13
cf. CMTA Law, Title I, Chapter 3, Section 118
14
cf. CMTA Law. Title I, Chapter 3, Section 117

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 or the distribution of money, cigars, cigarettes or other goods
when such distribution is dependent on chance, including
jackpot and pinball machines or similar contrivances, or parts
thereof;

c. Lottery and sweepstakes tickets, except advertisements

thereof and lists of drawings therein;

d. Marijuana, opium, poppies, coca leaves, heroin or other

narcotics or synthetic drugs which are or may hereafter be
declared habit forming by the President of the Philippines, or
any compound, manufactured salt, derivative, or preparation
thereof, except when imported by the government of the
Philippines or any person duly authorized by the Dangerous
Drugs Board, for medicinal purposes;

e. Opium pipes or parts thereof, of whatever material; and

f. Any other goods whose importation and exportation are

restricted.

The restriction to import the above stated goods shall include the
restriction on their transit.15

Section 4. General Provisions.

4.1. Shipments subject to this CAO shall be as follows:

4.1.1. Goods of Commercial Nature with FOB or FCA value of less

than fifty thousand pesos (₱50,000.00).

4.1.2. Personal and household effects or goods, not in commercial

quantity, whether or not subject to duties and/or taxes.

4.1.3. Those Conditionally Tax and/or Duty-Exempt Importations

under Section 800 of CMTA that shall be included are as
follows:

i. Section 800 (f) for Conditionally tax and/or Duty-Exempt

Importation of Returning Residents and OFWs as
embodied separately in CAO no 6-2016.

ii. Section 800 (g) for Balikbayan Boxes sent to families or

relatives by Qualified Filipinos while abroad.
Consolidated shipment of duty and tax free Balikbayan
boxes as embodied separately in another CAO.

iii. Section 800 (h) for Personal and household effects

belonging to foreign consultants and experts hired by,
or rendering service to, the government, and their staff

15
cf. CMTA Law, Title I, Chapter 3, Section 119

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 or personnel and families accompanying them or
arriving within a reasonable time before or after their
arrival in the Philippines, in quantities and of the kind
necessary and suitable to the profession, rank or
position of the person importing said items, for their
own use and not for barter, sale or hire, subject to
conditions as may be required by the DOF and the
Bureau;

iv. Section 800 (i) for Professional instruments and

implements, tools of trade, occupation or employment,
wearing apparel, domestic animals, and personal and
household effects belonging to persons coming to settle
in the Philippines or Overseas Filipinos or their families
and descendants who are now residents or citizens of
other countries, such parties hereinafter referred to as
overseas Filipinos subject to conditions as may be
required by the DOF and the Bureau;

v. Section 800 (l) for Importations for the personal or

family use of members and attaches of foreign
embassies, legations, consular officers and other
representatives of foreign governments and importation
of documents for official use. Whereas, importations for
the official use of foreign embassies, legations, and
other agencies of foreign governments shall fall under
Informal Entry Process provided the value as
determined by the Bureau is less than fifty thousand
pesos (P50,000.00) subject to conditions as may be
required by the Department of Foreign Affairs (DFA),
DOF and the Bureau;

vi. Section 800 (aa) for any officer or employee of the DFA,
including any attached, civil or military or member of the
staff assigned to a Philippine diplomatic mission abroad
by the Department or any similar officer or employee of
other departments assigned to any Philippine consular
office abroad, or any AFP military personnel accorded
assimilated diplomatic rank or on duty abroad who is
returning from a regular assignment abroad, for
reassignment to the home office, or who dies, resigns,
or is retired from the service subject to conditions as
may be required by the DOF and the Bureau.

vii.Clearance of Goods on the importation of motor vehicle,

regardless of the consignee, covered under Section 800
of CMTA shall be entered under the Formal Entry
Process.

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 4.1.4. Those remaining sub-paragraphs of Section 800 of CMTA,
Conditionally Tax and/or Duty-Exempt Importations shall
fall under Informal Entry Process provided the value as
determined by the Bureau is less than fifty thousand pesos
(P50,000.00).

4.1.5. De Minimis importations under Section 423 of CMTA shall

be governed under CAO 2-2016.

4.1.6. Relief Consignment under Section 120 of CMTA shall be

governed under the existing rules and regulations.

4.1.7. Other non-commercial goods not falling under the above

enumerations and not covered under formal entry process.

Section 5. Operational Provisions.

5.1. Lodgement of Goods Declaration. Goods declaration shall be

lodged through the BOC portal which allows the declarant to
accomplish, submit and register goods declaration online at
anytime, anywhere following a prescribed format.

Pending full automation, goods declaration shall be filed at the

Informal Entry Division (IED) or equivalent unit of the port
concerned, using the Informal Import Declaration and Entry (IIDE)
BC Form No. 177.

5.2. Documentary Requirements. Unless and until the Bureau shall

provide lodging the Informal Entry using the Single Administrative
Document or any Goods Declaration through the BOC portal, the
IIDE signed by the declarant and the customs broker, if any, and
duly notarized must be submitted to the IED or its equivalent office
or unit with the following supporting documents:

5.2.1. BL or AWB, or in the absence thereof, a written order by

the carrier or agent of the vessel or aircraft;

5.2.2. Commercial invoice or any other verifiable commercial

document evidencing payment;16

5.2.3. Packing list;

5.2.4. Permit to Deliver Imported Goods (PDIG) BC Form No.

194; and

5.2.5. Other documents as may be required by rules and

regulations, such as:

i. Import authority, permit, clearance or license for

imported goods listed in the official list of regulated

16
cf. CMTA Law, Title IV, Chapter 1, Section 414

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 goods as posted in the BOC website. For this purpose,
the Bureau shall periodically update the official list of
regulated goods;

ii. Sanitary and Phytosanitary (SPS) certificate, if

applicable;

iii. Authority to Release Imported Goods (ATRIG), if

applicable; and

iv. Tax Exemption Indorsement (TEI).

5.3. Period to Lodge or File Goods Declaration. Goods declaration

must be lodged within fifteen (15) days from the date of discharge
of the last package from the vessel or aircraft. The period to lodge
or file the goods declaration may, upon request, be extended on
valid grounds for another fifteen (15) days: Provided that the
request is made before the expiration of the original period within
which to file the goods declaration: Provided, However, that the
period of the lodgement of the goods declaration may be adjusted
by the Commissioner.

Approval of the request for extension given after the expiration of

the original 15 day period shall be governed by the CAO on
Abandonment.

5.4. Provisional Goods Declaration. The purpose on the processing

of Informal Entry under the concept of Provisional Goods
Declaration is to facilitate trade and to prevent goods for being
declared abandoned. Transitory procedures are to be observed
prior to full implementation on the specific code to identify that
the goods declaration is provisional in nature upon filing of entry
otherwise the manual write- off of the bill of lading shall ensure
that the goods declaration shall be considered full and complete
ready for release.

a. To allow the acceptance on the lodgement of provisional

goods declaration shall fall under the following circumstances:

i. As a rule, goods which are subject to regulation shall be

imported only after securing the necessary clearances,
licenses, and any other requirements, however upon
lodgement of goods declaration, no regulatory permit,
clearance or license has been presented, and the importer
has filed his application to secure such clearances, permit
or license prior to the departure of the goods from the
country of origin or the arrival of the goods, shall be
allowed but only in cases provided for by governing laws
and regulations;

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 ii. When the Tax Exemption Indorsement has not been
issued; and

iii. Any other situation where the declarant lacks certain

information or document to make a complete goods
declaration.

b. The manner to be instituted from the filing of provisional goods

declaration may be allowed provided the following documents
are presented:

i. The same application of documentary requirements under

subsection 5.2.1 up to 5.2.4 of this CAO.

ii. Duly notarized undertaking by the declarant that the other

supporting documents required to complete the goods
declaration pursuant to this CAO shall be submitted within
forty-five (45) days from the filing of the provisional goods
declaration, which period may be extended by the Bureau
for a maximum period of another forty-five (45) days for
valid reasons.

iii. There will be a written request for the extension to be

approved by the Collector of Customs provided that the
said request for extension is made prior to the lapse of the
original forty-five (45) days period.

c. Intent of Provisional Goods Declaration.

i. If the Collector of Customs accepts a provisional goods

declaration, the duty and tax treatment of the goods shall
not be different from that of goods with complete
declaration.17

ii. Tentative assessment of provisional goods declaration shall

be completed upon final readjustment and submission by
the declarant of the additional information or
documentation within forty-five (45) days from the filing of
the provisional goods declaration, which period may be
extended by the Bureau for a maximum period of another
forty-five (45) days for valid reasons.

d. Rules governing the conditional release of goods under

provisional goods declaration:

i. In case of regulated shipments, the conditional release of

goods shall not be permitted unless the regulatory

17
cf. CMTA Law, Title IV, Chapter 1, Section 403, 2nd par.

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 government agency concerned allows such release subject
to the following conditions:

1. Goods shall be delivered to the importer’s premises or

warehouse for storage and subject to continuous
underguarding and shall not be disposed until the
required permit or clearance or license is issued and
submitted to the Bureau within the prescribed period.

2. Specific and sufficient security18 shall be required to

cover the amount of duties, taxes and other charges that
shall be collected.

ii. In all other cases, the conditional release of goods

provisionally declared shall also be subject to specific and
sufficient security to cover the amount of duties, taxes and
other charges that shall be collected when the lacking
information or document is not submitted within the
prescribed period.

e. Effects of the non-compliance with the conditions for the

release of goods under the provisional goods declaration.

i. Failure to submit the required permit, clearance or license

from the regulatory government agency concerned within
the required period, the regulated goods shall be subject to
seizure and forfeiture, provided due notice is given to the
consignee.

ii. In case where the provisional goods declaration is lodged

due to the incomplete import documents to assess the
correct duties, taxes and other charges, any security posted
shall answer for the corresponding duties and taxes due to
the government without prejudice to the filing of
administrative charge and other legal remedies against the
consignee after due notice and hearing.

5.5. Abandonment, Kinds and Effects of. The provisions on

abandonment under Chapter 6, Title XI of the CMTA shall also
apply to goods cleared under the Informal Entry Process.

5.6. Examination. Pursuant to internationally accepted standards, the

Bureau may adopt nonintrusive examination of goods, such as the
use of x-ray machines.

Physical examination of the goods shall be conducted when:

18
cf. CMTA Law, Title XV, Section 1507

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 a. It is directed by the Commissioner on account of a derogatory
information;

b. The goods are subject to an Alert Order issued by competent

authority;

c. The goods are electronically selected for physical examination,

if applicable;

d. There are issues and controversies surrounding the goods

declaration and the import clearance process; or

e. The importer or declarant requests for the examination of the

goods.

The Commissioner may exempt from physical examination the

goods of authorized economic operators or of those provided
for under any existing trade facilitation program of the Bureau.

Physical examination, when required, shall be conducted in an

expeditious manner.19

5.6.1. Types of Examination on Goods Declaration under Informal

Entry Process:

a. For the conduct of examination, pending the

establishment of X-ray machine for every Outside
Container Yard/ Container Freight Station (CY/CFS) as
required by the Bureau, a mandatory physical
examination shall be conducted for goods of a commercial
nature with FOB or FCA value not exceeding fifty
thousand pesos (Php50,000.00) and other shipments
subject to this CAO.

b. Mandatory x-ray inspection for all containerized cargo

under the Informal Entry Process shall be conducted after
assessment and payment of corresponding duties and
taxes based on the documents presented. In cases where
the x-ray image raises suspicion of irregularity, this
requires physical examination.

c. Mandatory X-ray inspection for goods intended for airport

warehouses and/or composite warehouses.

5.7. Risk Management Application. For the application of risk

management, the Bureau shall apply profiling purposes, in the
determination of the risk imports using selectivity parameters as
may be determined by the Bureau.

19
cf. CMTA Law, Title IV, Chapter 2, Section 420

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 5.8. Assessment. For shipment of goods other than containerized
consolidated shipment of balikbayan boxes falling under informal
entry process shall be assessed based on the existing rules and
regulations where assigned customs examiner shall conduct the
examination and make a speedy determination whether the
contents correspond with the packing list.

For purposes of assessing duties and taxes on imported goods, the

customs officer shall classify, value, and determine the duties and
taxes to be paid.20

Section 6. Administrative Provision.

6.1. Import Processing Fee. Import Processing Fee amounting to two

hundred fifty (250) pesos shall be collected for every shipment
filed through an informal entry process based on CAO on Customs
Service Fees.

6.2. Documentary Stamp based on CAO on Customs Service Fees.

6.3. Container Security Fee based on CAO on Customs Service Fees.

6.4. Adjustment of value of Goods of Commercial Nature. The

Commissioner may adjust the value of Goods of Commercial
Nature that shall be cleared through an Informal Entry Process
without prejudice to the periodic adjustment by the Secretary of
Finance.21

Section 7. Penal Provision. Violations of this CAO committed by any person,

officer or employee shall be penalized in accordance with Title XIV of the CMTA and
other applicable penal provisions.

Section 8. Repealing Clause. This CAO amends or repeals previously issued CAOs
and CMOs which are inconsistent with the provisions herein stated.

Section 9. Separability Clause. If any part of this order is declared

unconstitutional or contrary to laws, the other parts not so declared shall remain in
full force and effect.

Section 10. Review. This CAO shall be reviewed every three (3) years and be
amended or revised, if necessary.

Section 11. Effectivity. This CAO shall take effect thirty (30) days from publication
at the Official Gazette or a newspaper of national circulation.

The Office of the National Administrative Registrar (ONAR) of the UP Law Center shall
be provided three (3) copies of this CAO.

20
cf. CMTA Law, Title IV, Chapter 3, Section 424.
21
cf. CMTA Law, Title IV, Chapter 1, Section 402.

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ISIDRO S LAPEÑA, PhD, CSEE
Commissioner

Approved:

SEC CARLOS G DOMINGUEZ

Secretary

Informational Section. As the title denotes this section only provides information
and does not give rise to any substantive or formal rights or obligations.

History. This CAO is amendatory to all the previous issuances of the Bureau
of Customs relating to Goods under the Informal Entry Process.

“The collection, recording, storage maintenance, processing, sharing of data

and information; and maintenance of data information in the CAO shall be
secured and consistent with the principles and policy of Republic Act 10173,
also known as The Data Privacy Act.”

Related Policies.
 CMO No. 13-2010 “Procedures for the Implementation of E2M Customs
System – Phase 4 Informal Entry of Commercial Goods in all Customs
Sea Ports Nationwide”.
 CAO No. 8-2014 “Guidelines in the Imposition of Customs Documentary
Stamp and Import Processing Fee for Informal Entries”.

Webpage, Forms, Handbooks and other References.

 Informal Import Declaration and Entry BOC Form No. 177
 International Commercial Terms 2010
 Republic Act No. 10863 “Customs Modernization and Tariff Act”

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