APPEAL IN

PROTEST AND
FORFEITURE
CASES
 Sec. 1126. Appeal to the Commissioner
– In forfeiture cases, the person aggrieved by the decision of a District
Collector may, within fifteen (15) days or five (5) days in case of
perishable goods, from receipt of the decision, file a written notice of
appeal, together with the required appeal fee to the District Collector,
furnishing a copy to the Commissioner. The District Collector shall
immediately transmit all the records of the proceedings to the
Commissioner, who shall review and decide on the appeal within thirty
(30) days from receipt of the records, or fifteen (15) days in the case of
perishable goods: Provided, That if within thirty (30) days, no decision is
rendered, the decision of the District Collector under appeal shall be
deemed affirmed. An appeal filed beyond the period herein prescribed
shall be dismissed.
• Appeals to protest cases shall be governed by Section 114 of this Act.
Sec. 1127. Automatic Review in Forfeiture
Cases.
• –The Commissioner shall automatically review any decision by the District Collector
adverse to the government. The entire records of the case shall be elevated within five (5)
days from the promulgation of the decision. The Commissioner shall decide on the
automatic review within thirty (30) days, or within ten (10) days in the case of perishable
goods, from receipt of the records. When no decision is rendered within the prescribed
period or when a decision adverse to the government is rendered by the Commissioner
involving goods with FOB or FCA value of ten million pesos (P10,000,000.00) or more, the
records of the decision of the Commissioner, or of the District Collector under review, as
the case may be, shall be automatically elevated within five (5) days for review by the
Secretary of Finance. The decision issued by the Secretary of Finance, whether or not a
decision was rendered by the Commissioner within thirty (30) days, or within ten (10)
days in the case of perishable goods, from receipt of the records, shall be final upon the
Bureau.
Sec. 1128. Automatic Review by the
Secretary of Finance in Other Cases
• –Incases not involving protest or forfeiture, the Commissioner shall automatically
review any decision by the District Collector that is adverse to the government. The
records of the case shall be elevated to the Commissioner within five (5) days from
the promulgation of the decision. The Commissioner shall decide on the automatic
review within thirty (30) days from receipt of the records, or within ten (10) days in
the case of perishable goods. When no decision is rendered within the prescribed
period or when any decision rendered by the Commissioner is adverse to the
government, the records of the ease under review shall be automatically elevated
within five (5) days for the review of the Secretary of Finance. The decision issued
by the Secretary of Finance, whether or not a decision was rendered by the
Commissioner within thirty (30) days from receipt of the records, or within ten (10)
days in the case of perishable goods, shall be final upon the Bureau.
ABANDONMENT
 Sec. 1129. Abandonment, Kinds and Effects of. –

  Imported goods are deemed abandoned under any of the following circumstances:

(a) When the owner, importer, or consignee of the imported goods expressly signifies in
writing to the District Collector the intention to abandon the same; o

(b) When the owner, importer, consignee, or interested party after due notice, fails to
file the goods declaration within the prescribed period in Section 407 of this Act:
Provided, That the term goods declaration shall include provisional or incomplete goods
declaration deemed valid by the Bureau as provided in Section 403 of this Act. For this
purpose, it is the duty of the District Collector to post a list of all packages discharged
and their consignees, whether electronically or physically in the District Office, or send
a notice to the consignee within five (5) days from the date of discharge; or 
 Sec. 1129. Abandonment, Kinds and Effects of. –

(c) Having filed such goods declaration, the owner, importer, consignee or interested party
after due notice, fails to pay the assessed duties, taxes and other charges thereon, or, if the
regulated goods failed to comply with Section 117 of this Act, within fifteen (15) days from
the date of final assessment: Provided, That if such regulated goods are subject of an alert
order and the assessed duties, taxes and other charges thereof are not paid within fifteen (15)
days from notification by the Bureau of the resolution of the alert order, the same shall also be
deemed abandoned; or

(d) Having paid the assessed duties, taxes and other charges, the owner, importer or consignee
or interested party after due notice, fails to claim the goods within thirty (30) days from
payment. For this purpose, the arrastre or warehouse operator shall report the unclaimed
goods to the District Collector for disposition pursuant to the provisions of this Act; or
 Sec. 1130. Treatment and Disposition of Abandoned
Goods.

–Expressly abandoned goods under paragraph (a) of Section 1129 of this Act
shall ipso facto be deemed the property of the government and shall be
disposed of in accordance with the provisions of this Act.
• If the Bureau has not disposed of the abandoned goods, the owner or
importer of goods impliedly abandoned may, at any time within thirty (30)
days after the lapse of the prescribed period to file the declaration, reclaim
the goods provided that all legal requirements have been complied with and
the corresponding duties, taxes and other charges, without prejudice to
charges and fees due to the port or terminal operator, as well as expenses
incurred have been paid before the release of the goods from customs
custody.
 Sec. 1130. Treatment and Disposition of Abandoned
Goods.

• When the Bureau sells goods which have been impliedly abandoned,
although no offense has been discovered, the proceeds of the sale,
after deduction of any duty and tax and all other charges and expenses
incurred as provided in Section 1143 of this Act, shall be turned over
to those persons entitled to receive them or, when this is not possible,
held at their disposal for a specified period. After the lapse of the
specified period, the balance shall be transferred to the forfeiture fund
as provided in Section 1151 of this Act.
JUDICIAL PROCEEDINGS
Sec. 1135. Supervision and Control over
Criminal and Civil Proceedings.

– Civil and criminal actions and proceedings instituted on behalf of the Government
under the authority of this Act or other laws enforced by the Bureau shall be brought in
the name of the government of the Philippines and shall be prosecuted and handled by
the Bureau with the assistance of the Department of Justice (DOJ): Provided, That the
determination of the existence of probable cause and the subsequent filing of any
criminal or civil case with the proper court against violators of this Act shall
exclusively belong to the DOJ: Provided, however, That no civil or criminal action for
the recovery of duties or the enforcement of any fine, penalty or forfeiture under this
Act shall be filed in court without the approval of the Commissioner.
Sec. 1136. Review by the CTA.

– Unless otherwise provided in this Act or by any other law, the party aggrieved by
the ruling or decisions of the Commissioner may appeal to the CTA, in the manner
and within the period prescribed by law and regulations. Decisions of the Secretary
of Finance when required by this Act, may likewise be appealed to the CTA.
 
Unless an appeal is made to the CTA in the manner and within the period
prescribed by law and regulations, the ruling or decision of the Commissioner or
the Secretary of Finance shall be final and executory.
Sec. 1137. Exclusive Jurisdiction of the
Bureau

Jurisdiction over imported goods and goods for exportation shall be

exclusive to the Bureau, or the Secretary of Finance, when under review
by the latter, subject to the proceedings described in this title.

Except for the CIA, no court may issue any order or decision until all
the remedies for administrative appeal have been exhausted.
Sec. 1138. Fraud Investigation and
Prosecution

– No criminal case for violation of this title shall be instituted without the
approval of the Commissioner pursuant to the provisions of this Act.

The Bureau shall have the power to investigate and institute smuggling
cases committed within its jurisdiction: Provided, That in case of
inquest, the same may be instituted by the apprehending customs officer.
 
DISPOSITION OF PROPERTY
IN CUSTOMS CUSTODY
 Sec. 1139. Goods Subject to Disposition.
– Goods in customs custody that are in the following conditions and status shall be
subject to disposition:
(a) Abandoned goods;
(b) Goods entered under warehousing entry but not withdrawn, or those whose duties and
taxes have not been paid within the period prescribed under Section 811 of this Act;
(c) Forfeited goods, other than prohibited, restricted and regulated goods; after liability
have been established by the proper administrative or judicial proceedings in conformity
with the provisions of this Act; and
(d) Goods subject to a valid lien for customs duties, taxes and other charges collectible
by the Bureau, after the expiration of the period allowed for payment thereof.
Sec. 1140. Place of Disposition of Goods.

– Upon the order of the District Collector, goods may be sold or otherwise
disposed of at the port where the goods are located, unless the Commissioner
shall direct its transfer to another port.
 
Sec. 1141. Mode of Disposition

– The goods subject to disposition may be donated to another government agency or

declared for official use of the Bureau, after approval of the Secretary of Finance, or sold
at a public auction within thirty (30) days after a ten (10)-day notice posted at a public
place at the port where the goods are located and published electronically or in a
newspaper of general circulation.
 
For purposes of donating the goods as above described, goods suitable for shelter or
consisting of foodstuffs, clothing materials or medicines may be donated to the DSWD.
Sec. 1142. Disqualification to Participate in
Auction Sale

 
. – No customs officer or employee, their spouses and relatives within the fourth
degree of consanguinity or affinity shall be allowed to bid directly or indirectly,
in any customs auction.
 
 
 – The following expenses and obligations shall be paid from
the proceeds of the sale in the order provided:

(a) Customs duties, except in the case of forfeited goods;

(b) Taxes and other charges due the government;

(c) Government storage charges;

Sec. 1143. (d) Expenses for the appraisal, advertisement, and sale of
auctioned goods;

Disposition (e) Arrastre and private storage charges and demurrage

charges; and

of Proceeds. (f) Freight, lighterage or general average, on the voyage of

importation, of which due notice shall have been given to the
District Collector.

The Commissioner is authorized to determine the maximum

charges to be recovered by private entities concerned under
subsections (e) and (f) of this section.
Sec. 1144. Disposition of Perishable Goods

. – Perishable goods as defined under this Act when certified as such by the
Bureau, may be sold at a public auction within five (5) days, after a three (3)-day
notice.
For this purpose, perishable goods shall include goods liable to perish or be
wasted, or those that depreciate greatly in value while stored, or which cannot be
kept without great disproportionate expense. The Bureau shall proceed to
advertise and sell the same at auction upon notice as shall be deemed to be
reasonable.
Sec. 1145. Disposition of Goods Injurious to
Public Health
. – Goods in the custody of the Bureau which, in the opinion of the District Collector are
injurious to public health, shall be seized. The District Collector shall, if the matter is not
disposable under the provisions relating to food and drugs, appoint three (3) members to
constitute a Board to examine the goods. The Board shall be composed of one (1) representative
from either the DOH or other appropriate government agency or the local government unit
(LGU) concerned, and two (2) representatives from the Bureau. If the goods are found to be
injurious to public health, the Board shall report this to the District Collector, who shall order its
destruction in an appropriate manner or order its re-exportation in accordance with this Act.
 
The District Collector shall immediately coordinate with the health and quarantine officers at the
port of entry for the disposition of goods injurious to public health.
 • – Prohibited goods, as provided in
Section 118 of this Act, shall be
Sec. 1146. destroyed, except paragraph (d)
thereof which shall be turned over
Disposition to the BSP. All goods suitable for
shelter, foodstuffs, clothing
of materials or medicines may be
Prohibited disposed in accordance with
Section 1141 of this Act.
Good.
Sec. 1147. Disposition of Restricted Goods

.– Restricted goods as described in Section 119 of this Act shall be disposed as follows:

(a) Dynamite, gunpowder, ammunitions and other explosives, firearms and weapons of war, and parts thereof shall be
turned over to the AFP;

(b) Roulette wheels, gambling outfits, loaded dice, marked cards, machines, apparatus or mechanical devices used in
gambling 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 shall be turned over to the appropriate
government body or agency

(c) Lottery and sweepstakes tickets, except advertisements thereof, and lists of drawings therein shall be turned over to the
appropriate government body or agency,
Sec. 1147. Disposition of Restricted Goods

(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, shall be turned over to the
Dangerous Drugs Board 
(e) Opium pipes and parts thereof, of whatever material, shall be turned over to the Dangerous
Drugs Board;
(f) All other restricted goods which are highly dangerous to be kept or handled shall be destroyed
in a manner as the District Collector deems appropriate. Otherwise, the restricted goods shall be
turned over to the proper government agency for appropriate handling.
Sec. 1148. Disposition of Regulated Goods

. – Regulated goods shall be disposed of in a manner to be determined by the

appropriate regulatory agency. In the event that the regulatory agency allows the
disposition of the regulated goods with commercial value and capable of
legitimate use, these shall be disposed of in accordance with Section 1141 of this
Act.
Sec. 1149. Disposition of Unsold Goods for
Want of Bidders
– Goods subject to sale at public auction by the Bureau shall be sold at a price not less
than the landed cost of the goods adjusted for normal depreciation.
Goods which remain unsold after at least two (2) public biddings either due to the lack
of bidders or for the lack of an acceptable bid, may be donated to another government
agency or declared for official use of the Bureau. If the goods are not suitable either for
official use or donation, these may be subject to reexport as government property or
sold through a negotiated sale. In case of negotiated sale, the same shall be subject to
the approval of the Secretary of Finance and executed in the presence of a
representative of the COA. For purposes of donating the goods as above described,
goods suitable for shelter or consisting of foodstuffs, clothing materials or medicines
may be donated to the DSWD.
Sec. 1150. Disposition of Smuggled Goods

– Smuggled goods, when forfeited, shall be disposed of as provided in Section

1148 of this Act.
Sec. 1151. Forfeiture Fund

– All proceeds from public auction sales after deduction of the charges as provided in Section 1143 of this Act and subject to the
claim of the owner or importer of an impliedly abandoned goods as provided in Section 1130 of this Act, shall be deposited in an
account to be known as Forfeiture Fund.

The Fund shall be in the name of and shall be managed by the Bureau which is hereby authorized, subject to the usual government
accounting rules and regulations, to utilize it for the following purposes:

(a) To outsource, subject to the rules on government procurement established by law, the management of the inventory,
safekeeping, maintenance and sale of goods enumerated in Section 1139 of this Act to private service providers: Provided, That
the Bureau shall retain jurisdictional control and supervision over these goods as well as the operations of the service provider so
contracted;

(b) To facilitate customs seizure, abandonment and forfeiture proceedings and the disposition of goods under Section 1139 of this
Act, particularly those to be disposed of other than through public sale;
Sec. 1151. Forfeiture Fund

–
(c) To enhance customs intelligence and enforcement capability to prevent smuggling; and
(d) To support the modernization program and other operational efficiency and trade facilitation initiatives
of the Bureau.

The DOF and the Department of Budget and Management (DBM) shall, upon the recommendation of the
Bureau, issue a joint regulation to implement the provisions of this section.