POST CLEARANCE AUDIT AND PRIOR DISCLOSURE PROGRAM - created from Mind Map

Seite 1

SECTION 3: DEFINITION OF TERMS

SECTION 2: OBJECTIVE

SECTION 4; Requirement to Keep Records.

SECTION 5: POST CLEARANCE AUDIT

SECTION 6: PRIOR DISCLOSURE PROGRAM

SECTION 7: INTEREST ON DEFFICIENCY DUTIES TAXES AND OTHER CHARGERS PLUS FINE OR PENALTY

SECTION 8: REMEDIES OF IMPORTER

SECTION 9: REMEDIES OF THE BUREAU

SECTION 10: ADMINISTRATIVE AND CRIMINAL OFFENSES

SECTION 11: RECORDS TO BE KEPT BY BUREAU

SECTION 12: AUDIT MONITORING AND RECORD KEEPING

Customs Broker

Importer

any person who is a bona fide holder of a valid Certificate of Registration or Professional Identification Card i

Customs Clearance

shall refer to the completion of customs and other government formalities

Customs Clearance for Consumption Entries

procedure of making the final payment of duties and taxes and other charges

Customs Clearance for Warehousing Entries

procedure of filing of goods declaration and the duties and taxes

Customs Clearance for Transit Entries

customs procedure under which goods, in its original form, are given permit to be transported

Customs Clearance for Transshipment Entries

customs procedure under which goods are given permit to be transferred under customs contro

Fraud

the commission or omission of any act resulting in material false statements

Free Zones

special economic zones registered with the Philippine Economic Zone Authority (PEZA)

Post Clearance Audit Group (PCAG)

Mandated to conduct audit of importers, locators, and all parties engaged in customs clearance and processing,

Reinvestigation of Audit Findings

a plea for the reevaluation of the audit findings on the basis of newly discovered or additional evidence

Importer-of-record or consignee, owner or declarant,

Inadvertent Error

a mechanical, electronic or clerical error committed unintentionally by the Importer

Locators

persons authorized to bring imported goods into Free Zones,

Misclassification

the use of insufficient or wrong description of the goods or the use of erroneous tariff headings

Misdeclaration

a false, untruthful, erroneous or inaccurate declaration as to quantity, quality, description, weight or measurement of the goods

NegIigence

failure to exercise reasonable care and competence,

Principal Place of Business

the headquarters that holds the senior executive of a firm

Prior Disclosure Program

a program based on international best customs practice,

Reconsideration of Audit Findings

a plea for the re-evaluation of the audit findings on basis of existing records need of additional evidence.

UndervaIuation

situation when the declared value fails to disclose in full the price actually paid or payable

To prescribe the principles, purposes and methodology of the post clearance audit system, record keeping requirement and the period covered by the conduct of audit;

To provide guidance for record-keeping, document retention and other legal obligations of Importers and other customs stakeholders and the adverse consequences of non-compliance with customs rules and regulations;

To facilitate trade by strengthening customs controls from the border to the back-end of the cargo clearance process under a regime of informed compliance;

To promote compliance with customs laws and regulations by providing a non-punitive facility for Importers to voluntarily disclose or report to customs authorities the errors in goods declarations and in the payment of duties, taxes and other charges;

To provide a clear set of policies and guidelines in the application and availment of the PDP; and

To generate additional customs revenues with least administrative cost to both the government and the Importer.

4.1 Audit and Examination of Records.

4.2. Entities Required to Maintain and Keep Records.

4.3 Purposes of Keeping Records.

Period and Place to Keep Records.

Records Required to be Kept.

SECTION 100O OF THE CMTA TITLE X

Period of Limitation: In the absence of fraud (assessment shall be credited within 3 years

Importers

Customs Brokers and Other Parties

Locators

To confirm the truthfulness and accuracy of the goods declaration and the transaction value

To check the adequacy and integrity of the manual or electronic system

To determine the level of compliance of Importers, Customs Brokers, Locators, and other parties

To serve as basis or the imposition of sanctions for non- compliance on record keeping

importers, are required to keep all records to the ordinary course of business and to any activity or information contained in the records for a period of three (3) years

All parties engaged in Customs Clearance and processing and locators to bring imported goods into Free Zones for a period of 3 years

Documentation on the entity organization and structure,

Documentation on orders and purchases

Documentation on shipping, importation, exportation and transport,

Documentation on manufacturing, stock and resale,

Financial documents such as financial statements and other accounting information,

5.1. Composition of PCAG

5.2 Authority of the Commissioner to Reorqanize PCAG.

5.3 Functions of PCAG.

5.4 Scope of Audit

5.5. Conduct of Post Clearance Audit.

5.6 Access to Records

5.7 Documents Written in a Foreign Language.

5.8 Power of the Commissioner to Obtain Information and Issue Summons.

The PCAG is headed by an Assistant Commissioner who shall exercise direct supervision and control in the management

Two operating units of PCAG

Trade Information and Risk Analysis Office (PCAG-TIRAO);

Compliance Assessment Office (PCAG-CAO)

Review available trade data to determine compliance markers of industry

(MISTG), develop a computer-aided riskbased management system, for use in the profiling and identification of potential priority audit candidates

Recommend for approval of the Commissioner the potential priority audit candidates

Develop policies, guidelines, manuals and standard operating procedures relating to the audit process;

Perform such other functions

Prepare the audit work plan, scope and approach for the approved priority audit candidates;

Conduct the audit examination, inspection, verification or investigation of records

Prepare and submit the required reports on audit findings

Establish and maintain a customs compliance program;

Perform such other functions

The Commissioner,is authorized to determine the number of personnel requirements of PCAG and issue the necessary order to reassign the required organic personnel of BOC to the Group.

The PCAG is mandated to conduct, within three (3) years

The Bureau shall develop a computer-aided riskbased management system, based on objectives and quantifiable data

Criteria for selecting firm to be audited (Section 1001 of Title X)

a.Relative magnitude of customs revenue to be generated from the firm;

b. The rates of duties of the firm's imports;

c. The compliance track records of the firm

d.An assessment of the risk to revenue of the firm's import activities,

The PCAG shall prepare a set of post clearance audit procedures, to strictly govern the audit to achieve the highest level of objectivity, fairness, efficiency, and transparency.

The guidelines for procedural/operational concerns:

Profiling/lnformation Analysis

Conduct of Audit Proper

Audit Notification

Audit Plan

Service of Demand Letter for Payment of Deficiency.

Reconsideration or Reinvestigation on Audit Findings

Acknowledgement Letter

Reporting to DOF and BIR.

PCAG-TIRAO shall perform risk profiling analysis activities on the Importers.

The audit team shall commence the audit proper not later than sixty (60) calendar days from the service of the ANL.

In case the Importer manifests his intention to avail of the PDP (Prior Disclosure Program), the conduct of the audit proper shall be deferred

The audit team may require the presentation of the original of the certified true copies of documents submitted for verification of its authenticity.

The audit shall be completed within one hundred twenty (120) calendar days

The audit is considered completed when the Final Audit Report (FAR) has been submitted by the audit team,

The issuance of the PCAG-CRF shall be deemed as proof that the importer or subject of audit has been found to have no deficiency in duties, taxes and other charges

The Commissioner shall issue an Audit Notification Letter (ANL) to the company identified for audit which shall include then name or name of PCAG-CAO

The audit team shall prepare an audit plan to meet the audit objectives

Within five (5) calendar days from receipt of the Demand Letter signed by the Commissioner,

may file a request for reconsideration or reinvestigation to the Commissioner within fifteen (15) days from receipt of the Demand Letter.

For requests for reinvestigation,

the Importer shall submit all relevant supporting documents in support thereof within thirty (30) days from the date of filing, otherwise, the request shall be denied.

the Bureau shall immediately issue without a need for request from the Importer

The Bureau shall furnish the DOF and the BIR a copy of the final audit results within thirty (30) calendar days

The Importer shall give to the Bureau personnel authorized to conduct the audit full and free access to the premises where the records are kept,

. The customs officer shall present written evidence of his authority.

must be accompanied with a translation in English,

Obtain on a regular basis from any person, in addition to the person who is the subject of a post clearance audit

Summon the person liable for duties and taxes or required to file goods declaration,

Take such testimony of the person concerned, under oath, as may be relevant or material to such inquiry;

Obtain information from banks or other financial institutions specifically to payments relevant to import transaction.

6.1. Who May Avail of the Prior Disclosure Proqram.

6.2. Exclusions from the PDP.

6. 3 Effects of PDP.

6.4. Verification and Action on the Application for PDP.

Any Importer without waiting for the issuance of an ANL, may avail of the PDP by

Any Importer who has received an ANL may still avail of the PDP by submitting the the accomplished formfor prior disclosure stating the errors in goods declaration

The Importer may amend the PDP taxes and penalties within an additional non-extendible application and pay additional deficiency period of thirty (30) calendar days

endering payment of the deficiency duties, taxes and penalties,

submitting the duly accomplished application form for prior disclosure the errors in station goods declaration

Goods declarations which are the subject of pending cases with any other Customs office

Goods declaration which are covered by cases alreadyed filand pending in courts

Goods declarations involving Fraud

For a PDP applicant who has not yet received an ANL,

For a PDP applicant who has received an ANL and availed of the program

For a PDP applicant who has made disclosures on royalties and other proceeds of any subsequent resale, disposal, or use of the imported goods that accrues directly or indirectly to the seller,

payment of the deficiency in duties and taxes due plus legal interest

For a PDP applicant who has received an ANL and availed of the program

payment of the deficiency in duties and taxes due without penalty and interest

provided that the applicant files for PDP within thirty (30) caar days from the date of payment

PCAG shall verify the completeness of the PDP application form

audit team shall then verify the accuracy of the deficiency duties and tax computation and determine if all errors are fully disclosed

In all cases, the tender of payment shall be accepted by the Bureau to be applied to the deficiencies in duties and taxes

PCAG shall verify the completeness of the PDP application form

PDP application shall be completed within the period of ninety (90) calendar days from the submission of the complete PDP documents.

As voluntarily disclosed regardless of whether the prior disclosure application is approved or denied by the Commissioner

An interest of twenty percent (20%) per annum, counted from the date of final assessment

under Section 429 of the CMTA shall be imposed on

Prior Disclosure Program availment

Deficiency duties, taxes and other charges

Fine or penalty, if any.

When the request for reconsideration or reinvestigation is denied by the Commissioner

the Importer may appeal such denial to the Court of Tax Appeals (CTA) within thirty (30) days

Distraint of goods, chattels or effects and other personal property of whatever character,

Levy upon real property and interest in rights to real property.

including stocks and other securities, debts, credits, bank accounts and interest in and rights to personal property.

upon, before, simultaneously or after the distraint of personal property belonging to the Importer.

Civil or criminal action.

The Bureau shall advance the amounts needed to defray costs of collection by means of civil or criminal action

Failure to Keep Records.

Suspension or cancellation of accreditation as Importer

Surcharge of twenty percent (20%) on the dutiable value of the goods

Hold delivery or release of subsequent imported articles

Criminal prosecution punishable with imprisonment of not less than three (3) years and one (1) day but not more than six (6) years, and/or a fine of One Million Pesos (Php 1,000,000.00) and

Failure or Refusal to Give Full and Free Access

Waiver of the right to contest the results of the audit based on records kept by the Bureau

Suspension or cancellation of accreditation as an Importer or Broker with the Bureau

Punishment for contempt, for contumacy or for refusal

Re-assessment of the importations subject of audit

Surcharge of twenty percent (20%) on the dutiable value of the goods

Hold delivery or release of subsequent imported articles

Criminal prosecution punishable with imprisonment of not less than three (3) years and one (1) day but not more than six (6) years, and/or a fine of One Million Pesos (Php 1,000,000.00)

Failure to Pay Correct Duties and Taxes on Imported Goods.

Negligence

Fraud

When a deficiency results from an offender's failure, through an act or acts of omission or commission, to exercise reasonable care and competence in ensuring that a statement made is correct,

A Penalty with a fine equivalent to one hundred twenty-five percent (125%) of the revenue loss.

penalized with a fine equivalent to one hundred twenty-five percent (125%) of the revenue loss.

A penalty with a fine equivalent to six (6) times of the revenue loss and/or imprisonment of not less than two (2) years but not more than eight (8) years.

Database of the Importer and CB profiles

Following info. and papers

Article of the Corporation

Company Structure

Key Importations

Privilege Enjoyed

Fine/Penalties

Risk Categories

PCAG, in coordination with the MISTG

shall establish and maintain a real-time case monitoring and control system

shall maintain a secured database of all audit results and records.