MICP- 12 October POM – 12 October

1. @ PORTS ‘09 MICP- 12 October POM – 12 October BoC CMO 27-2009: Implementing E2M IAS Francis Norman Lopez President

2. Agenda • Introduction • BOC e2m Import Assessment System, CM0 27-2009: IAS Rollout to All Ports • CPRS: Client Profile Registration System • eManifest • e2m Import Workflows: Formal, Warehouse, Transshipment, Informal • PASS5: ePayment of duties, taxes, fees • OLRS: BOC Release Instruction to warehouse and port operators • SSDT: Statement of Settlement of Duties and Taxes • Q & A

3. InterCommerce eCustoms Services • From Value Added Network (VAN) to Value Added Service Provider (VASP) • Customs EDI VAN from July 1998 –June 2007 • First Customs VASP in July 2007 • PEZA Ecozones, Clark Freeport, Subic Freeport, Board of Investments • eCustoms Services • Lodgment of Import Entry Declaration: Consumption/ Formal, Super Green Lane, Warehouse, Transshipment • eManifest submission by forwarders • ePayment of Customs Duties and Taxes • Online Cargo Release • Export Declaration • Alert Messages to importers via SMS/Text and Email 1st Customs EDI VAN (1998) PEZA VASP (2006), CDC VASP (2006), BOC VASP (July 2007) BOI VASP (Jan 2009)

4. PEZA About InterCommerce • IT, Value Added Network Services company • with more than 22 years experience in B2B transactions, and • more than 10 years in eCustoms Services – accredited as EDI VAN in 1998 and now accredited by Customs, PEZA, Clark and Subic Freeport and BOI as Value Added Service Provider (VASP) • A distributor of Global Exchange Services – GXS, the largest global B2B eCommerce services provider • Member, Pan Asian eCommerce Alliance (PAA) • Independent IT Company - No Affiliation with any logistics company (broker, forwarder, warehouse operator), thusno potential conflict of interest with client logistics providers, and ensuring data confidentiality and integrity • InterCommerce . . . YOUR Value Added Service Partner Department of Agriculture BAI BPI BFAR Local Focus – Global Reach !

5. Pan Asian eCommerce Alliance - PAA Korea China Japan Hongkong Macau Chinese Taipei Philippines Thailand Indonesia Malaysia Australia Singapore . . . PAA Members accredited by respective Customs Administration,provides the network infrastructure and legal framework for a secure and reliable information exchange

6. CMO 27-2009 – e2m IAS Implementation • Implementation of e2m Customs System -P3 IAS in all Customs Port Offices – nationwide before end Dec 2009 • Scope • Client Profile Registration System (CPRS) • eManifest System • Formal Entry System (FES) • Warehouse Entry System (WES) • Payment Abstract Secure System v5.0 (PASS5) • Other Settlement Modes (OSM) • Online Cargo Release (OLRS) Transshipment and Informal Entries still under ACOS procedures.

7. IAS Customs Clearance Workflow NWS BIR: ATRIG, DOF: TEC NSW • Validation • - CPRS • - NSW • - Manifest • Selectivity • SGL • Green • Yellow • Red • Assessment • PASS5 • OLRS Shipping Lines, Forwarder/Consolidators VASP Importers Brokers CY/CFS Operators BAP/PCHC Authorized Agent Banks - AAB

8. Client Profile Registration System • Mandatory for Customs brokers, Importers, other Customs stakeholders • including PEZA Accredited Locators • Importer needs the CCN of Broker and VASP* in its CPRS • Banks need copy of COR/CCN for the issuance of the Bank Reference Number_ BRN *InterCommerce CCN (VASP): VA0000000116

9. CPRS Data Elements • Basic Company Profile • Registered Name (with SEC, BIR, PEZA) • TIN • Address • Board of Directors: Top 5 Board of Directors ie Chairman, President, Corporate Secretary, Treasurer, etc. • Principal Officers : Top 5 Operating Officers ie President, Executive Vice-President, Sr. Vice-President, etc • Responsible Officers : Officers that interacts/interface with BOC, eg Purchasing, ImpEx or Logistics Manager • Nominated Customs broker with CCN • Nominated VASP with CCN

10. InterCommerce CPRS WebApplication • Importer registers with InterCommerce online (www.intercommerce.com.ph), providing user name, password • Submit accomplished Information Services Agreement • InterCommerce activated user name • Importer inputs all required information including digital pictures and scanned signatures • Importer clicks on “Submit” for transmission to BOC - and receives either a “Sent” or “Error” message • BOC sends email Alert Notification - ie. Stores, Approved or Disapproved, Activated

11. Client Profile Registration System • Steps in CPRS – email Alert Notification • Stored • Complete • Approved or Disapproved • If Approved, the COR/CCN is attached as pdf file • If Disapproved, CPRS automatically deleted • Activated • Amended • Expired • Registration of Certificate of Registration/CCN with the Authorized Agent Banks (AABs) • AAB issuance of the Bank Reference Number _ BRN

12. CPRS ‘Errors’ • "Disapproved" due to the following reasons: • Different business address as per CAS record. • Suspended or expired accreditation, or not yet Accredited as per CAS record • Incomplete or different business name, as per BIR or SEC Registration • Wrong TIN, invalid TIN, different TIN or no TIN per BIR Record • No picture of responsible officer, or unacceptable picture (size, quality) • Different name (broker) in PRC Record • COR/CCN not attached in “Approved” email Alert • No “Activated” email alert • Expired CAS Accreditation

13. Pre-Lodgement e2m IAS Requisites Importers CPRS Brokers CCN Warehouse Operators Airlines, Shipping Lines eManifest NSW/LCS Accreditation as BOC AAB, PAS5 Compliant PCHC/ B A P Bank AABs

14. eManifest Workflow Arrival Schedule BOC e2m IAS Manifest Processes Shipping / Air Lines Validates Manifest Manifest (IFM, Master) MBL Exist Registers Manifest Consol Manifest (GEN, BOL, CTN) Consolidators/ Forwarders Manifest to be submitted 12 hours prior to vessel arrival

15. Import Entry Workflows – e2m IAS National Single Window Gateway ATRIG, Tax Exemption Certificate (TEC) eIPS BIR DoFinance Airline/ Shipping Line Forwarder/ Consolidator Manifest/BL (BOL, GEN CTN) IED, Import Entry SAD Internet BOC Response: Assessment Final/Temporary Broker e2m IAS VASP Gateway Importers’ Online Visibility: Import Entry, Assessment Release Instruction Invoice, BL/AWB Statement of Settlement Of Duties and Taxes Arrastre, Whse, CY-CFS Importer Certificate of Registration/CCN ? Debit from Importer Account BOC Final Payment Instruction (Net: duties, taxes, fees) AAB Final Payment Confirmation BAP/PASS5 AAB BRN + Auto Debit Agreement (ADA)

16. Major Changes - Lodgment • Import Entry Declaration - IED • Electronic lodgment thru VASP, prior to opening of Letter of Credit • PASS5/auto debit payment of Advanced Duties to be settled within 7 days • Import Entry – Consumption, Warehouse • Use of C-SAD Form ie InterCommerce’ WebCWS • No more encoding of IEIRD serial number in Box 28; Use importer’s bank reference number - BRN • PASS5/auto debit payment of Customs duties and taxes, based on Final Assessment • No more over the counter, advanced payment thru banks; No O/R • No check writing and PAS4 file name • No additional payment at the Port of Discharge • Automated matching of payment vs Final Assessment, automatically triggering the Release Instruction to arrastre, warehouse or CY/CFS • Automated issuance of Statement of Settlement of Duties and Taxes, upon receipt of AAB confirmation

17. Major Changes – Customs Processing • Validation of SAD • CPRS registration of importer and broker - CCN • Use of valid Bank Reference Number - BRN • eManifest data - eg multiple containers, details • National Single Window - NSW • BIR Authority To Release Imported Goods (ATRIG) • DOF Tax Exemption Certificate • PEZA eIPS ?? • Selectivity – no changes • Assessment • Automated response to entries within 10-20 minutes • Final Assessment Notice for SGL and Green Lane • Temporary Assessment Notice for Yellow and Red Lane

18. Major Changes – Payment of CDT • Bank Reference Number • AAB to issue BRN to importer upon presenting the COR/CCN and nominating account for autodebit arrangement • AAB to transmit importer BRN to BOC • Payment of duties, taxes and fees via PASS5 • Autodebit payment of advanced duties prior to opening of L/C based on Final Payment Instruction from BOC to AAB • Autodebit payment of duties, taxes and fees based on final Assessment and Final Payment Instruction from BOC to AAB • Net of advanced duties, TDM • Use of C-SAD Form eg. online printout from InterCommerce’ WebCWS • No more encoding of IEIRD serial number; Use importer’s bank reference number • PASS5/auto debit payment of Customs duties and taxes, based on Final Assessment • No more over the counter, advanced payment thru banks; No O/R • No check writing and PAS4 file name • No additional payment at the Port of Discharge

19. SSDT • BOC system generated Statement of Settlement of Duties and Taxes which serves as proof of payment on duties, taxes and fees • CUD: Customs Duties • VAT: 12% Value Added Tax • FIN: BOC fines, penalty, other charges • IPF: Import Processing Fee • CSF: Container Security Fee • CTF: Cargo Transfer Fee • TCC: Tax Credit Certificate • Bank may issue official receipt on the total amount paid for CDT and fees. • BOC to officially advise BIR on the issuance of said SSDT; BIR to verify details from BOC e2m system

20. BOC e2m IAS Benefits • Cost Savings : clerical, transport and other expenses • Broker preparation and Customs processing of documents • Processing of payment - MC, PAS4 encoding and transmission, “forced-matching by BOC Cashier • Electronic lodgment with response within 30 minutes • Demurrage, Storage charges • Reduced Cycle Time – from 3 days to 30 minutes • Electronic lodgment • Automated approval process • Autodebit of payment for duties and taxes • Automated matching of payment vs assessment • Automated Release Instruction • Transparency of Processes • Importers Online Visibility via InterCommerce website: Declaration, Assessment, SSDT and Management Reports

21. BOC e2m IAS Implementing CMOs • CMO 39– 2008 CPRS Database Build-up • CMO 6-2009 Procedures for the payment of Advance Duty Deposit and Final Payables • CMO 27-2009 Procedure for the implementation of e2m IAS in all Ports • CMO 30-2009 Procedures for the accreditation of CBW and CY/CFS • CMO 38-2009 Supplemental Guidelines (Assessment) to CMO 27-2009 • CMO 37-2009 Submission of electronic manifest through VASP’s • CMO 40-2009 Manual Discharge of Informal and Transshipment BL’s

22. Additional Policies and Procedures • Advance payments of CDT prior to ‘date of e2m IAS implementation’ at Port • First and last importer, importation • Tentative release • Short shipment • Post Entry Amendments, Modifications • Additional payment of CDT resulting from Post Entry • SSDT as an official document as importer’s proof of payment of duties, taxes and fees (in lieu of O/R)

23. e2m IAS Implementation Schedule • Port of Batangas : 21 March 2009 • Ports of Limay, Mariveles* : 10 Aug • Manila International Container Port : 12 Oct (17 Aug) • Port of Manila : 12 Oct (01 Sept) • Ports of Subic, Clark : TBA • Ports of Cebu, Mactan : TBA • Port of NAIA : TBA • Port of Davao : TBA • Port of Cagayan de Oro : TBA • Other Ports : TBA * Port of Mariveles “LIVE” as of 03 August 2009, import entry lodged by broker for Total Philippines thru InterCommerce

24. Key Areas needing Resolution Importer CPRS/CCN and BRN Only 5,000+ importers ? PEZA, CDC, SBMA registered enterprises eManifest Manifest data on ACOS and e2m IAS Timing on e-manifest lodgment by forwarders NSW: BIR ATRIG, DOF TEC 3-5 days prior to entry lodgment IED and Advanced Duty Payment Input previous payments to e2m E2m IAS Process Updated tariff tables eg JPEPA rates Final Assessment Notice for R/Y Lanes Release instruction to arrastre, CY-CFS Data accuracy PASS5 Final Payment Instruction Breakdown: Duties, VAT, Others ? Statement of Settlement of Duties, Taxes, Fees Acceptable to BIR as proof of VAT payments E2M IAS @ MICP, POM DOI moved to 12 October 2009

25. Q & A Unit 2203, 88 Corporate Center Sedeno St., Salcedo Village Makati City 1227 Telephone: +02 843 2792 Fax: +02 843 8160 Email: marketing@intercommerce.com.ph www.intercommerce.com.ph