Amending Guidelines to Implement Executive Order No. 262, s. 2003 in Conjunction with Executive Order No. 264, s. 2003

2011

AMENDING GUIDELINES TO IMPLEMENT EXECUTIVE ORDER NO. 262, S. 2003 IN CONJUNCTION WITH EXECUTIVE ORDER NO. 264, S. 2003

For Motor Vehicle Development Program (MVDP) Participants

I. Rationale:

Pursuant to Article 3 of Executive Order 156, prescribing the Comprehensive Motor Vehicle Development Program (New MVDP), the Board of Investments (BOI) in consultation with concerned government agencies and industry associations formulated the framework for the restructuring of MFN tariff rates of motor vehicle parts and components at such rates comparable to neighboring countries with similar development programs. Anchored on maintaining tariff differential between locally-manufactured and imported knocked-down parts and components, Executive Order Nos. 262, "Modifying the Nomenclature and Rates of Duty on Motor Vehicles Under Section 104 of the Tariff and Customs Code of 1978 (Presidential Decree No. 1464, as amended) ", and 264, "Modifying the Nomenclature and the Rates of Import Duty on Various Products Under Section 104 of the Tariff and Customs Code of 1978 (Presidential Decree No. 1464, as amended), were issued by the President on 30 December 2003.

II. Definition of Terms:

1. CBU shall refer to a vehicle in completely assembled form.

2. KD shall refer to knocked-down parts and components that are either locally produced or imported for assembly purposes.

3. Subpart/Parts shall refer to parts that are necessary for producing sub-assemblies/assemblies/components and/or other parts forming part of the KD pack.

4. Raw Materials shall refer to those materials that would require or undergo further processing for the manufacture of motor vehicle parts.

5. CAI — refers to the Certificate of Authority to Import issued to MVDP participants.

6. eCAI — shall refer to the electronic filing of the application for the Authorization to import, and its processing, collection of eCAI fees and approval, under E.O. 262.

7. BOI Trade System is a Windows based back end system, which will enable the MVDP participants and their registered brokers to file their CAI electronically using the Web Customs Workstation System (WebCWS). AIcECS

8. WebCWS is a comprehensive system that allows the remote electronic filing and processing of CAI with BOI and Import Declarations with the Bureau of Customs (BOC).

9. List of Importables (LOI)/Bill of Materials (BOM) shall refer to the list of KD parts which are submitted by the MVDP participants, as authorized under E.O. 262.

10. Approved items in the LOI shall refer to the pre-approved items, which may be imported upon filing and approval of the eCAI.

11. ePayment of eCAI Fees shall refer to the procedure where the importer remits advance payment deposit of eCAI fees to the BOI Cashier, and the actual payment by auto-debit of corresponding eCAI fee per transaction, from the advance payment deposit.

III. Qualifications:

1. Must be an MVDP participant of good standing.

2. With BOI-approved Parts Development Program for certain parts and components listed under E.O. 262 and E.O. 264 (as listed under Annex "B") that currently are not being sourced locally for specific basic and/or variant model/s.

IV. Exclusion:

Importation of aftermarket replacement parts and components under E.O. 262 shall be covered by these guidelines, excluding importation of aftermarket replacement parts and components under other issuances.

V. Procedures:

A. CAI and eCAI Application

1. The CAI/eCAI application covers importation of knocked-down parts and components under AHTN Heading Nos. 8702.90.19A; 8702.90.19B; 8702.90.99A; 8702.90.99B; 8703.90.51A; 8703.90.51B; 8703.90.52A; 8703.90.52B; 8703.90.53A; 8703.90.53B; 8703.90.54A; 8703.90.54B; 8703.90.90A; 8703.90.90B; 8704.90.90A and 8704.90.90B. Only not locally produced (NLP) parts and components are allowed for importation under subject AHTN headings.

2. Manual procedure: The MVDP participant shall submit a duly accomplished application form (BOI-MV Form 1, attached as Annex "A") signed by duly authorized company official * and duly notarized together with the following documents for proper evaluation: AEScHa

a. Proforma Invoice

b. Detailed list of parts to be imported in softcopy form (diskette)

c. For AICO: Certificate of Eligibility (COE) for first time importations and COE Number and date of COE for subsequent importations under said COE.

d. For Raw Materials (for further processing by the MVDP participant, its affiliate parts manufacturing company and/or local parts supplier manufacturing specific parts and components); Usage and Consumption Ratio; Agreement with Subcontractor; Liquidation Report of Past Importation; and Certificate of Non-Local Availability.

*  MVDP participants shall submit to BOI the name of the company official duly authorized to sign the CAI application. The same official must likewise guarantee the authenticity and integrity of the softcopy submitted thereto.

 Online procedure: Prior to online filing of application for CAI/eCAI, all MVDP participants shall register with the BOI prior to use of the eCAI. Procedures to apply for eCAI are discussed under B.ii.

3. In general, the application for CAI/eCAI shall be filed prior to opening of letter of credit (L/C) and/or ordering of items. The goods shall be loaded on board within the validity of the CAI/eCAI. Except for justifiable reasons, the BOI shall not accept application for CAI/eCAI for goods/commodities that have already been ordered and/or for which the corresponding L/Cs have been opened.

4. For replacement parts and components, importation should be under individual AHTN Headings with applied rate based on E.O. 262. Replacement parts and components listed under E.O. 262 with no quality, cost and delivery (QCD) compliance shall be allowed importation under E.O. 264 (if applicable) or under regular AHTN Heading tariff rates subject to issuance of Certification on Non-Local Availability (CNLA-attached as Annex "C") as outlined under item C (referral system). ADECcI

5. The CAI/eCAI, shall bear the following import commodity description:

"Brand-new knocked-down component parts except the following E.O.s 262 and 264 with QCD compliance> for the Assembly of "

Note: List of LP Parts with QCD compliance may vary per basic/variant model.

6. Only duly BOI registered model/s will be issued CAI/eCAI.

B. Procedures to Apply for CAI/eCAI

1. Manual Application

a. Duly accomplished CAI application form with the necessary supporting requirements must be submitted to the Motor Vehicles Division (MVD) of the BOI.

b. After checklisting whether documents are complete and application is correct and valid, the MVD shall issue order of payment of processing fee and claim stub.

c. The processing of applications shall be done on a first-come-first-served basis.

d. In cases of application covering and/or including importation of any of the local parts and components listed in Annex "B", application shall be subject to referral to concerned parts and components association [i.e., Motor Vehicle Parts Manufacturers Association of the Philippines (MVPMAP) and Motorcycle Parts Producers and Exporters Association (MCPPEA), for evaluation of QCD compliance (under item C, referral system). All referrals must be treated with utmost confidentiality.

e. For application covering importation of raw materials that require further processing, the same shall be referred to concerned industry association and/or local companies producing equivalent products for certification on non-local availability in terms of comparable quality, sufficient quantity and competitive price. The firm may already secure from concerned association a waiver/certification under oath which may be submitted as attachment to its request for CNLA. DAEaTS

f. The import authority shall be addressed to and released only to the MVDP participants. The Bureau of Customs (BOC) shall process qualified MVDP firm's importations only on the basis of an original CAI. The BOC shall indicate at the back of the CAI, importations processed against the CAI (with indication of running balance on utilization as the case warrants). The BOI shall provide BOC list of CAIs issued on a monthly basis for their reference and information. MVDP participants may be obliged to submit certified copy of the running balance of the CAI, five (5) days after removal from Customs.

g. The appropriate tariff heading shall be indicated on the CAI. The Tariff classification of the goods being imported shall be based on proforma invoice submitted with the CAI application and the details of the MVDP participant's model registration with the Board. The CAI shall bear the initial tariff classification of the goods, indicated as follows:

"Tariff Heading Reference No. ___________

Note: The BOC shall determine the final tariff classification of the goods/commodities covered by this Authority. "

h. In case the firm requires modifications of the CAI (e.g., from transport of persons to transport of goods), a written request shall be filed with the BOI prior to ordering. The request for amendments/modification shall be evaluated by BOI accordingly and referred to concerned Association when necessary.

i. The BOC shall have the responsibility of inspecting the goods, and thereafter determine the final tariff heading classification on the basis of its findings on whether the goods are in knocked-down (KD) or completely built-up (CBU) condition.

j. Processing of application covering importation of parts and components minus those listed under Annex "B" (hence exempted from referral procedure) shall entail a maximum period of four (4) working days from the date of official filing with the BOI Records Section.

k. In cases of application covering importation of items that require referral to concerned industry association and/or local companies, processing shall entail a maximum period of five (5) working days from the date of official filing with the BOI Records Section. TSHcIa 

l. The applicant can claim the original CAI at the BOI Records Section upon presentation of the claim stub on the 5th working day or 6th working day as the case may be, from official filing as indicated on the claim stub.

m. CAI is valid for three (3) months and is renewable only once (application for renewal should be made within the validity of the CAI).

2. Online Application

a. Registration with BOI for the eCAI

 The MVDP Participant shall submit to BOI a letter request of their intent to use the eCAI and their initial LOI (duly signed by a company official) in printed and soft copy format, providing the following details:

Company BOI Registry NumberAHTN Code

Tax Identification Number (TIN)Indicative FOB

Commodity CodeManufacturer/Supplier

Part NumberModel

Item DescriptionVariant

b. Upon submission of the LOI by the MVDP Participant to BOI, the BOI MVDP Authorized Officer will create the profile of the MVDP Participant and upload the list to the BOI Trade System.

c. After the list has been uploaded in the BOI Trade System, the system will automatically classify the items in the list as either Listed or Unlisted in E.O. 262 based on the AHTN code assigned to each item.

d. The BOI Authorized Officer will need to classify the models based on the following classifications:

• W/PDP — Participant has submitted the Parts Development Plan (PDP) for the model. The Participant will be allowed to file an eCAI for the model under this classification.

• W/O PDP — Participant has not submitted the PDP for the model within the timeframe set by BOI. The Participant will not be allowed to file an eCAI for the model under this classification.

• W/Waiver — Participant has secured a waiver from either MVPMAP or MCPPEA for the model. The Participant will be allowed to file an eCAI for the model under this classification. EScaIT

• New Model — Participant has declared that this is a new model and is given 8 months by BOI for the submission of the PDP. The Participant will be allowed to file an eCAI under this classification.

e. Based on the model classification, an email alert will be sent to either MVPMAP or MCPPEA informing the authorized officers of MVPMAP or MCPPEA that they will need to log into the BOI Trade System with their assigned usernames to tag the items in the list as either QCD COMPLIANT or NON-COMPLIANT, MVPMAP and MCPPEA will be given a 24-hour limit to tag the items. If items were not tagged within the 24-hour limit, they will be automatically tagged as NON-COMPLIANT by the system.

f. The authorized BOI Officer must tag the items in the submitted list as W/PDP, W/O PDP, W/WAIVER after the confirmation of either MCPPEA or MVPMAP.

• W/PDP — The Participant will still be able to file an eCAI for the MODEL. However, the approved eCAI printout will include a list of items that are not allowed to enjoy lower tariff.

• W/O PDP — The Participant will be able to file an eCAI for items tagged as W/O PDP.

• W/Waiver — The Participant will be able to file an eCAI for items tagged as W/Waiver.

g. The Participant may now file an eCAI once BOI tags the items. However, should the Participant lack reportorial requirements, Participant will not be able to file an eCAI until they settle it with BOI.

C. Referral to Concerned Industry/Association/Manufacturer

Referral Timeframe:

The referral procedure below will be implemented initially for the first six (6) months upon effectivity of these guidelines, and will be subject for further review and/or extension depending on the creation of a fully-operational database of local parts. A positive list of all locally produced parts and components (under E.O.s 262 and 264) with QCD compliance per basic per variant model of all importations made during the period will form part of the database that will be built as reference for future/succeeding importations.

For registered models and variants under the Program with no actual importation during the subject six (6) months period. Participants must submit to BOI, a month thereafter, a per basic per variant model list of parts and components under E.O.s 262 and 264 requested for deletion and/or importation under the knocked-down parts and components heading. The list must include price per parts and components and the usual lead time needed for assembly purpose (from ordering, importation up to delivery). Subject list will be referred to concerned parts association (i.e., MVPMAP and MCPPEA) for evaluation of QCD compliance. Result of said referral will subsequently be included in the database of positive list of locally produced parts and components per E.O.s 262 and 264 listing. Parts associations are given 15 working days from date of official referral to complete QCD evaluation of all concerned registered models and variants. Non-action of the concerned parts association within 15 days from official referral shall be construed to mean that the referred parts are not QCD compliant. TaIHEA

Should there be any importation of said basic and/or variant model/s during the covered period (1 month plus 15 days), parts and components under E.O. 262 and E.O. 264 (as listed under Annex "B") will not be allowed importation under the knocked-down AHTN Heading Nos. 8702.90.19A; 8702.90.19B; 8702.90.99A; 8702.90.99B; 8703.90.51A; 8703.90.51B; 8703.90.52A; 8703.90.52B; 8703.90.53A; 8703.90.53B; 8703.90.54A; 8703.90.54B; 8703.90.90A; 8703.90.90B; 8704.90.90A and 8704.90.90B.

In the event parts makers are already capable of complying with the QCD requirement of parts and components under E.O.s 262 and 264 initially assessed to be non-QCD compliant, a written undertaking must be submitted to BOI, thereafter the referral system will apply.

Referral Procedure:

1. Manual Application:

a. OEM parts and components under E.O.s 262 and 264 (as listed under Annex "B") and raw materials (requiring further processing into another product) that are requested for importation under the knocked-down AHTN Headings should be supported by the following information (as reflected in the proforma invoice):

i. Detailed descriptions/specifications

ii. Unit cost

iii. Quantity

 Likewise, the same information will be required for request for importation of replacement parts and components (only for those listed under E.O. 262) at regular AHTN Heading rates.

b. The foregoing information will be referred to concerned parts makers association i.e., MVPMAP and MCPPEA accordingly for assessment on QCD compliance for both OEM and replacement parts and components. All referrals must be treated with utmost confidentiality.

c. For Raw Materials importation, referral will be made to concerned industry association and/or local companies producing equivalent products for CNLA in terms of comparable quality, sufficient quantity and at competitive price.

d. A written response will be required from the association/manufacturer within twenty-four (24) hours from receipt of MVD referral DSATCI

 If no reply is received within twenty-four (24) hours from the concerned industry association/companies, it is assumed that subject parts and components are non-QCD compliant and that the Raw Materials are not locally available in sufficient quantity, comparable quality and at reasonable prices pursuant to Article 39.c.1 of E.O. 226 and can therefore be allowed importation under the knocked-down AHTN Heading (i.e., for OEM parts and components). Replacement parts and components (under E.O. 262) on the other hand will be allowed importation at regular AHTN Heading tariff rates subject to CNLA.

e. Concerned parts association shall assess the request on the basis of the following (see attached Annex "E"):

 QCD Complied, hence should not be imported under the knocked-down AHTN Heading Nos. 8702.90.19A; 8702.90.19B; 8702.90.99A; 8702.90.99B; 8703.90.51A; 8703.90.51B; 8703.90.52A; 8703.90.52B; 8703.90.53A; 8703.90.53B; 8703.90.54A; 8703.90.54B; 8703.90.90A; 8703.90.90B; 8704.90.90A and 8704.90.90B. Importation is under individual AHTN Headings (with E.O.s 262 and 264 applied rates)

 With BOI-Approved Assembler's Parts Development Program, with target date of full-localization set on <actual date of compliance>

 Prior to <actual date of compliance> (i.e., full localization). Assemblers will be allowed to import subject parts and components under the knocked-down AHTN Headings (as enumerated above).

 No QCD compliance, can import subject parts and components under the knocked-down AHTN Headings (as enumerated above).

 With pending request with TC for tariff modification (i.e., deletion from E.O. 262 listing)

f. For referred parts and components evaluated to be QCD compliant, MVDP participants may take any of the following options:

i. Import subject parts and components under individual AHTN Headings with applied rates under E.O. 262 (import authority is not required under this option). cCTaSH

ii. Source the subject parts and components from local manufacturers.

iii. File a request for re-assessment, contesting findings on QCD compliance of subject parts A Review Committee headed by BOI and composed of representatives from assemblers and parts makers shall be created to re-evaluate QCD compliance in terms of comparable quality (research, technical validation, ocular inspection), sufficient quantity (assessment of plant capacity and current customer volume requirement) and competitive price (based on BOI approved computation). The Review Committee within ten (10) working days shall submit its findings and recommendations for consideration of the BOI Board.

 Within five (5) working days from publication of these guidelines concerned industry association shall name its representatives to the Review Committee. The mechanism on dispute settlement shall be formulated by the group within ten (10) working days from creation thereof.

g. For referred parts and components with BOI-Approved Assembler's Parts Development Program, Assemblers will be allowed to import subject parts and components under the knocked-down AHTN Headings, prior to actual date of compliance/project completion and/or full localization. 

 Failure of any party to comply with the BOI-Approved Assembler's Parts Development Program will result to imposition of necessary penalty, i.e., for non-compliance of parts manufacturer, permanent authority to allow importation of subject basic/variant model's parts and components under the knocked-down AHTN Headings; while for non-compliance by assembler, permanent inclusion of subject basic/variant model's parts and components on the list of locally produced parts and components that cannot be imported under the knocked-down AHTN Headings; hence, importation shall be under individual AHTN Headings. CAaEDH

 In the absence of a duly BOI-approved Assembler's Parts Development Program, all importations of subject parts and components shall not be issued a CAI/eCAI.

h. Referred parts and components initially evaluated with no QCD compliance will automatically be allowed under the knocked-down AHTN Headings on succeeding importation. In the event parts makers of subject parts and components are already capable to comply with the QCD requirement of the same, a written undertaking by the concerned parts makers must be submitted to BOI, henceforth, QCD referral will apply.

2. Online Application

 A one-time checking for the QCD will be made by the concerned association (MVPMAP/MCPPEA) when the List of Importables is first uploaded and made part of the database. All E.O. 262 parts will be screened and flagged by the system from the List of Importables and an alert will be sent to the association that such model with its List of Importables has been uploaded. The association will confirm the QCD compliance and indicate the information in the database. For all application made on this model, the system can check whether any E.O. 262 item contained in the application can be allowed for importation. Since the association has an access to this database, changes can be made on the QCD compliance whenever necessary.

D. Deletion of Certain Parts and Components under E.O.s 262 and 264 [as listed under Annex "B" (Change from Locally Produced to Not Locally Produced Category)]

1. For deletion of certain parts and components under E.O.s 262 and 264 listing (change from LP to NLP category) due to economic, financial and/or technical viability (e.g., regional complementation, absence of economies of scale, poor quality, labor problem), concerned parts and components manufacturer/assembler if upon their judgment warrant the change from LP to NLP category, must file with the Tariff Commission request for tariff modification (reduction of tariff rates).

2. To provide sufficient lead time to effect the necessary amendment on its supply chain and in order not to unduly influence the pricing scheme or to avoid additional burden to the consumer due to possible price increase, a transition period of up to eight (8) months will be given to both Assemblers and parts makers.

3. During the transition period MVDP participants (Assemblers) will be allowed to import identified parts and components for deletion under E.O. 262 under the knocked-down AHTN Headings subject to the issuance of a CAI/eCAI. Additional requirement for application is a Duly notarized agreement between the Assembler and parts manufacturer highlighting the following: aSEHDA

• A formal request for tariff modification and the deletion of subject parts and components under E.O. 262 was already filed with the TC

• Request for authority to allow Assemblers to import subject parts and components under the knocked-down AHTN Headings

• The subject parts and components will still require further processing by the parts makers (if applicable)

E. Sourcing of Parts and Components from PEZA Registered Firms

OEM or replacement parts and components listed under Annex "B" (covered by E.O.s 262 and 264) sourced from PEZA registered companies as finished product, is subject to existing PEZA law e.g., E.O. 214. However, in case an item listed under Annex "B" is imported by a PEZA registered firm and is supplied for OEM market as forming part of a sub-assembly or assembly, it must be covered by a CAI/eCAI to be allowed importation under knocked-down AHTN Headings, otherwise duties and taxes shall be based on E.O. 262 in conjunction with E.O. 264 tariff rates.

F. Importation of Parts and Components of Newly and Existing Registered Models

1. For newly registered models, a transition period of eight (8) months, from actual date of BOI approval, will be given for both MVDP participants and parts manufacturer to work on the Parts Development/Localization Program specifically of locally produced parts and components listed under Annex "B". Said Parts Development Program shall be submitted to BOI for approval.

2. Within eight (8) months from actual date of BOI approval of the new model, MVDP participants will be allowed importation of parts and components under KD AHTN Headings, thereafter, parts and components identified under the approved Parts Development Program in item E shall no longer be allowed importation under knock-down AHTN Headings and should instead be imported under individual AHTN Headings for both OEM and replacement parts, with applied rates based on E.O. 262.

3. In the absence of a duly BOI-approved Parts Development Program after eight (8) months from actual date of BOI approval, MVDP participants may be allowed to import parts and components under KD AHTN Headings subject to submission of a Waiver, issued by concerned parts and components association, extending the transition period of another four (4) months to work on the Parts Development/Localization Program. Issuance of Waiver shall be only issued once per new registered model.

 For existing models without BOI-approved Parts Development Program, MVDP participants may be allowed to import parts and components under KD AHTN Headings subject to submission of a Waiver, issued by concerned parts and components association, with a validity of four (4) months from date of effectivity of this guideline. TADCSE

 All importation of parts and components listed under E.O. 262 in conjunction with E.O. 264 without BOI-approved Parts and Development Program shall not be issued a CAI/eCAI and should instead be imported under individual AHTN headings for both OEM and replacement parts, with applied rates based on E.O. 262.

G. Importation of Parts and Components from Asean

Importation of OEM and replacement parts and components listed under E.O. 262 in conjunction with E.O. 264 from ASEAN will likewise be subject to QCD compliance.

H. CAI Amendment, Renewal/Extension and Cancellation

1. Manual Application

a. Amendments covering changes in volume, value and name of bank shall be allowed within the validity of the CAI, which validity is within three months from the date of issue. A written request for amendment must be submitted together with the revised proforma invoice (indicating changes in volume and value) but of the same invoice number. In case of changes in model to be imported, the applicant must submit a new application.

b. On request for extension/renewal and cancellation of CAI, the following are required:

i. Original copy of Import Authority (should still be valid)

ii. Letter request

iii. Duly notarized Board Resolution, signed by either the company President or Corporate Secretary, certifying any of the following as may be warranted:

• Actual number of units imported and the balance thereof supported by a bank certification of status of payment and/or actual LC open per subject CAI

• Import authority is not used

iv. Certification from the Bureau of Customs (BOC) on the Utilization of the CAI. In the absence of the above certification, it will be assumed that the CAI was fully utilized.

c. Original copy of the Import Authority submitted for cancellation or renewal without entry on the back thereof, in the absence of requirement item 2.c above shall be considered as fully utilized. ASICDH

d. Any request for renewal or cancellation with incomplete documentation shall not be entertained by the BOI.

2. Online Application

 eCAI shall be valid within three (3) months from the date of issue. No renewal or amendment of eCAI will be processed since the eCAI will be used for a one shipment (per transaction) only in compliance with the National Single Window (NSW) of the Bureau of Customs.

I. Applied Tariff Rates Importation Guide

E.O. 262

With QCDWithout QCD

•OEM Parts — importation under•OEM Parts — importation underE.O. 262 rates(with Certificate of Authority to

•Replacement Parts — importation•Replacement Parts — importationE.O. 262 ratestariff rate (subject to Certification

E.O. 264

With QCDWithout QCD

•OEM Parts — importation•OEM Parts — importationE.O. 264 ratesHeadings (with Certificate of

•Replacement Parts — not•Replacement Parts — notE.O. 264(importation @ E.O. 264

RAW MATERIALS

Not Locally AvailableLocally Available

•Importation under•Importation under individual

VI. Monitoring and Supervision

1. CAI Liquidation Report

 Manual Application

a. All MVDP participants shall submit to BOI Liquidation Report (attached Annex "F") within one month from end of each quarter which report will indicate the CAIs issued for the preceding quarter, the actual importation, the actual production/sales (based on what comes out of the assembly plant i.e., wholesale volume) and the unutilized balances.

b. The sales reported should reconcile with the sales reported by the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI), Truck Manufacturers Association (TMA) and Motorcycles Development Program Participants Association (MDPPA) as warranted. The Liquidation Report must be duly signed by the company's official and duly notarized. 

 Online Application

 Since the eCAI will be used for one shipment (per transaction) in line with the implementation of NSW of BOC, the eCAI will be automatically liquidated. ATHCDa

2. Purchase Report of Locally Produced Parts and Components

a. MVDP participants shall submit to BOI Purchase Report (Annex "G") on both imported and Locally Produced Parts and Components of items listed in Annex "B" within one month from end of each quarter. The report shall contain the following information:

i. The Report shall be supported by the following documents:

• Certification under oath from supplier of local parts and components, certifying the volume purchased for the specified period

• Certified copy of the Customs Import Entry Internal Revenue Declaration Form (for imported parts and components)

ii. The reported purchase information must tally with the actual volume per model of assembled vehicles (per BOI Liquidation Report)

b. Failure to submit said report within the specified deadline shall result to temporary suspension of knocked-down importation privileges, which will last until such time said report is submitted.

3. Government Monitoring

a. The BOI shall submit to BOC monthly report on all CAI/eCAI issued under the Program.

b. The BOC shall submit to BOI and DOF actual importation covered by a CAI/eCAI under the Program at the end of each quarter.

c. The BOC shall issue additional directives, circulars or orders if necessary to implement the provisions of these guidelines.

VII. General Provisions

1. The BOI may suspend the availment of the knocked-down importation privilege under the Program, in case of violation of any of the terms and conditions of registration, including non-submission of such reports and statistical data that may be required by the BOI. DETACa

2. The participant shall comply with the directives and instructions that the BOI shall issue from time to time in pursuance of its authority under E.O. 262 in conjunction with E.O. 264 and its implementing guidelines, and its powers and duties under Executive Order 226, otherwise known as the Omnibus Investments Code of 1987.

3. The participant shall observe and abide by the provisions of E.O. 262 in conjunction of E.O. 264 and its implementing guidelines, as well as the commitments and representations it made in its application for registration. It shall take adequate measures to ensure that its obligations therein are faithfully discharged.

4. The participant shall allow the duly authorized representatives of the BOI to inspect its assembly and manufacturing facilities, examine pertinent books of account, record and documents in order to ascertain compliance with the provisions of E.O. 262 in conjunction with E.O. 264 and its implementing guidelines, its commitments and representations, as well as the general and specific terms and conditions of its registration.

5. These guidelines may be amended after review and consultation with concerned industry and as approved by the BOI.

VIII. Penalties and Sanctions as Warranted by Law

A registered participant found in violation of any of the terms of conditions of registration under the E.O. shall be imposed any or all of the following penalties:

a. Suspension of the issuance of Certificate of Authority to import knocked-down parts and components

b. Refund of tax and duty differential between the CBU and knocked-down parts and components on all importations and other government incentives, if any

c. Suspension or Cancellation of registration

d. Other appropriate penalties

IX. Fees

1. Manual Application

a. Application for or Amendment, Renewal or Extension of Certificate of Import Authority (CAI) — P1,500.00 IcHAaS

b. Application for or Amendment, Renewal or Extension of Certification on Non-Local Availability — P1,500.00

2. Electronic Certificate of Authority to Import

 eCAI fee — P650.00 per transaction

 The MVDP Participant must set up a CAI Fee Account by remitting funds/paying in advance to the BOI Cashier to cover the applications to be filed online. The BOI Cashier will issue an official receipt, which shall be forwarded to the BOI Authorized Officer to encode and update the account of the participant. The participant will be alerted of their account balances every time the participant's files an application online.

 Only account with sufficient funds will be allowed to file an application for eCAI.

X. Implementing Agency

The Board of Investments shall be the implementing agency of these guidelines consistent with the MVDP.

XI. Separability Clause

All provisions of these guidelines to implement E.O. 262 in conjunction with E.O. 264 are hereby declared separable and in the event any such provisions is declared unconstitutional, the other provisions, which are not affected, thereby shall remain in force and in effect.

XII. Confidentiality

Information submitted by the participants relative to the online application for the authority to import shall be deemed confidential. All confidential information shall remain at all times the property of BOI and may only be disclosed to BOI's authorized employees and/or consultants involved in the use thereof and have agreed in writing to be bound by a Non-Disclosure Agreement.

XIII. Transitory Provision

A period of three (3) months from effectivity of these guidelines will be in effect to allow smooth transition of filing of application from manual to online process. This is in compliance with the implementation of the Philippine National Single Window (NSW), which will allow BOI to transmit electronic copies of the approved Certificate of Import Authorization to the Bureau of Customs. TaEIcS

XIV. Effectivity

These guidelines shall take effect fifteen (15) days after date of publication in a newspaper of general circulation.

(SGD.) CRISTINO L. PANLILIODTI Undersecretary and BOI Managing Head

Published in The Philippine Star on February 16, 2011.