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New Guidelines for Customs Bonded Warehouses

By Aziza Hannah Bacay on February 24, 2022

In 2019, the Bureau of Customs (BoC) issued Customs Administrative Order (CAO) 13-2019 to implement provisions under the Customs Modernization and Tariff Act.

Section 10 of CAO 13-2019 provides for a review of customs bonded warehouse (CBW) guidelines every three years and their amendment or revision if necessary. In accordance with the periodic review, CAO 01-2022 issued last Feb. 10, 2022 outlines new and updated guidelines and consolidates existing CBW issuances.

CBW features

Generally, goods imported into the country are subject to duties and taxes. Goods entered for warehousing in CBWs, however, are exempt from duties and taxes within a prescribed storage period. This is because CBWs are considered extensions of customs premises insofar as the stored dutiable goods are concerned.

CAO 01-2022 notes that there are some exclusions to the exemption. For instance, it does not apply to implements, machineries, spare parts, apparatuses, supplies and tools to be used to construct, repair or operate any manufacturing customs bonded warehouse (MCBW). The exemption is only applicable if such supplies and spare parts are indispensably needed for the production of the finished products.

CBW types

There are different types of CBWs: manufacturing and non-manufacturing. An MCBW is a warehouse wherein products are manufactured using imported raw materials that are duty and tax-free. The exemption from duties and taxes is subject to the condition that the finished products must be exported or withdrawn for domestic consumption within the prescribed storage period.

CAO 01-2022 adds that raw materials entered for consumption must not exceed 30 percent of raw materials entered for exporting. Withdrawal of goods for consumption beyond 30 percent will only be allowed under meritorious instances such as cancelled orders, closure of CBWs and the like.

In a non-manufacturing customs bonded warehouse (NCBW), meanwhile, the goods are stored duty and tax-free, subject to the condition that they be withdrawn within the prescribed storage period and that duties and taxes are paid upon withdrawal. An example of this are private CBWs, which are authorized by the BoC to import and receive goods intended for domestic sale or consumption.

CAO 01-2022 reclassifies public customs bonded warehouses (previously classified as NCBWs) as customs facilities warehouses (CFWs). A CFW is a facility for temporary storage of goods established and authorized by the BoC. This includes container yards, container freight stations, and seaport and/or airport temporary storage warehouses, among others. CFWs are subject to provisions of CAO 09-2019.

Storage Period

CAO 01-2022 provides for the same prescribed storage periods as that of CAO 13-2019 but some new rules were introduced. Goods entered for warehousing, for example, may remain in a CBW for a maximum period of one year from the time of arrival at the warehouse.

Perishable goods only have a three-month storage period, which may be extended for an additional three months, subject to the submission of a letter request stating valid reasons. CAO 01-2022 adds that prior to the lapse of the prescribed period, the BoC should notify the CBW operator to either withdraw the goods for production and re-export or pay the duties and taxes payable.

Furthermore, bonded raw materials withdrawn within the prescribed storage period should be manufactured and exported within one year from their arrival at the CBW. Goods not withdrawn will be deemed abandoned. CAO 01-2022 also adds that if the goods are withdrawn for manufacture within the prescribed period but are not exported, such may be subject of a request for exportation by the CBW operator but penalties will be imposable and payable. Furthermore, the request for exportation must be made prior to the expiration of the storage period.

Period to liquidate

Upon the date of complete and full exportation of the finished goods, the importer should submit complete documents for liquidation of entry within a non-extendible period of 60 days. The period also applies in cases when complete exportation is made before the expiration of the storage period.

There is also a maximum period of 30 days from expiration of the storage period within which to submit the liquidation documents. Submission beyond the 30-day period will be deemed late and subject to penalties.


Penalties under CAO 19-2019 were updated in the new guidelines. Diversion of bonded goods and unauthorized relocation of goods are now punishable by closure of the CBW, while unauthorized changes in CBW layouts and unauthorized structural changes and extensions are punishable by the suspension of warehousing privileges or closure of the CBW, depending on the number of offenses involved.

CAO 01-2022 also increased the amount of penalties for late filing of applications for the renewal of authority to operate, late exportation and re-exportation, late submission of documents for liquidation of goods declaration and for cancellation of warehousing bonds.

CBW operators must take careful note of the new guidelines to avoid incurring penalties.

Aziza Hannah A. Bacay is a junior associate of Mata-Perez, Tamayo and Francisco (MTF Counsel).

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