http://www.farrow.

com/article-what-is-customs-brokerage

What is Customs Brokerage?

Customs brokerage firms facilitate the shipment and delivery of goods across geographical borders for individuals
and organizations.

The general public is often unaware of the sheer magnitude of goods and raw materials that cross these international
borders every single day and what is involved in clearing these goods through customs in different countries.

Customs Brokerage Expedites International Trade

Each country operates under a different set of rules and regulations regarding the transfer of goods entering or
leaving their borders. Customs regulations and laws concerning import and export of goods are constantly changing
all over the world, sometimes even on a daily basis.

A customs brokerage firm is responsible for knowing all of these rules and regulations and ensuring that they are
followed, in order to streamline the process of shipping goods as much as possible for the individual or organization.
In effect, customs brokers alleviate the stress of dealing with customs officials and learning shipping regulations so
that their clients can spend more time on what they are good at – managing their core business.

Customs brokers serve in effect as translators, communicating with agencies and government throughout the
shipping process, to ensure that all of the proper procedures have been followed.

Customs Brokerage in a Digital Age

As quickly as the regulations regarding shipments are changing, so is the way people are doing business. It is clear
that transactions regarding shipments and customs clearance procedures are being migrated online. Customs
brokerage firms are constantly researching and developing their internal infrastructure to coincide with all
requirements, so that procedures, electronic or otherwise, are followed properly.

Customs brokers ensure they have the most current technology, and that they stay on top of the various
developments in this dynamic industry to provide the best quality service for their clients at all times.
http://www.priority-one.com/what-is-priority-one-international.html
WHAT IS A CUSTOMS BROKER?
Formal entries of foreign-made goods representing many billions of dollars in duty collections are filed each year with
the U.S. Customs Service, and virtually all of them are prepared by a Customs broker on behalf of importers.

Customs brokers are licensed and regulated by the Treasury Department.

The Customs broker is primarily the agent for the importer who employs him. He is frequently the importer's only point
of contact with the U.S. Customs Service and advises on the technical requirements of importing, preparing and filing
entry documents, obtaining the necessary bonds, depositing U.S. import duties, securing release of the goods and
arranging delivery to the importer's premises or warehouse. The broker often consults with Customs to determine the
proper rate of duty or basis of appraisement, and on many occasions, if he is dissatisfied with either rate or value, he
will pursue appropriate administrative remedies on behalf of his importer.

Customs brokers are essential to the U.S. Customs Service. There are over 200 laws that Customs must implement
and enforce, and the experienced brokers in all ports constitute a most valuable resource of benefit to Customs.

In all, Customs brokers play a vital role in facilitating the entry, clearance and movement of import cargo and will
become even more essential in the future. As stated by the U.S. Commissioner of Customs during Congressional
hearings, "in my view, the Customs broker, the Service's liaison man with the importing public, will be needed as long
as there are legal requirements and regulations pertaining to the movement of merchandise into the United States."

WHAT IS A FREIGHT FORWARDER?

An international freight forwarder brings together all the loose ends that must be coordinated if American products are
to be shipped to foreign buyers in the course of our nation's international trade.

They are both small and large firms that have been licensed by the federal Maritime Commissions as fit, willing and
able to provide the expert know-how and experience needed to arrange for the movement of cargo from inland points
to foreign destinations with maximum speed and efficiency at the least cost to the exporter.

Acting as an agent of the exporter, the forwarder must be able to advise on the myriad of U.S. government
regulations affecting foreign trade, as well as the import rules of various foreign countries. He must have a detailed
knowledge of his ports and their facilities and be able to advise the shipper as to the best port of shipment for the
fastest transit time. He prepares and/or checks on various shipping documents and necessary licenses, he books or
confirms space on the ocean vessel, he arranges transportation of cargo to shipside by rail or truck, he arranges
cargo insurance on behalf of the exporter, he pays ocean freight for his principal and generally orchestrates the entire
movement of goods from point of origin to seaboard and beyond in the most efficient and cost-saving manner.

The international freight forwarder must have an intimate knowledge of transportation techniques-both their
possibilities and their limitations-and has to know how to advise and act in the best interests of his exporter principal.

Often called the "Architect of Transport", the forwarder performs an essential role in America's constantly growing
foreign trade.
https://help.cbp.gov/app/answers/detail/a_id/300/~/customs-brokers---
preparation-and-training-suggestions-for-customs-broker

Customs Brokers - Preparation and training suggestions for

Customs Broker License Examination

How can I prepare or get training for the Customs Broker License
Examination?
Customs and Border Protection (CBP) does not offer training for the Customs Broker License
Examination, but there are private options available.

Customs brokers are private individuals, partnerships, associations or corporations licensed, regulated
and empowered by U.S. Customs and Border Protection (CBP) to assist importers and exporters in
meeting Federal requirements governing imports and exports. Brokers submit necessary information
and appropriate payments to CBP on behalf of their clients and charge them a fee for this service.

Brokers must have expertise in the entry procedures, admissibility requirements, classification,
valuation, and the rates of duty and applicable taxes and fees for imported merchandise. For
more information visit Becoming a Customs Broker on CBP.gov.
Applicants should bring the reference materials noted below and any other pertinent reference
materials to the examination. The use of any other versions of the listed references other than
those recommended is at the applicant's own risk.
 Harmonized Tariff Schedule of the United States (2014 Basic Edition, No Supplements)

 Title 19, Code of Federal Regulations (Revised as of April 1, 2014)

 Customs and Trade Automated Interface Requirements(CATAIR)


 Appendix B - Valid Codes

 Appendix D - Metric Conversion

 Appendix E - Valid Entry Numbers

 Appendix G - Common Errors

 Glossary of Terms

 Instructions for Preparation of CBP Form 7501 (July 24, 2012)

 Right to Make Entry Directive 3530-002A

Applicants must provide their own reference materials.

Examinees may use any written reference material; however, use of any electronic device during the
exam other than a simple pocket calculator is strictly prohibited. Examples of prohibited devices
include, but are not limited to, scientific calculators and similar devices which have QWERTY

(keyboard-like) input or which allow anything in addition to numeric input, laptops or

portable/handheld computers, tablets, smart phones, or personal digital assistants (PDAs).

If you wish to receive automatic updates to this Q&A, select "Subscribe to Updates" on the left
side of this screen.

Reference materials for the Customs Brokers License

Examination

What reference material can be used in the Customs Brokers License

Examination?

Applicants should bring the reference materials noted below and any other pertinent reference

materials to the examination. The use of any other versions of the listed references other than those

recommended is at the applicant's own risk.


 Harmonized Tariff Schedule of the United States (2014 Basic Edition, No Supplements)

 Title 19, Code of Federal Regulations (Revised as of April 1, 2014)

 Customs and Trade Automated Interface Requirements(CATAIR)


 Appendix B - Valid Codes

 Appendix D - Metric Conversion

 Appendix E - Valid Entry Numbers

 Appendix G - Common Errors

 Glossary of Terms

 Instructions for Preparation of CBP Form 7501 (July 24, 2012)

 Right to Make Entry Directive 3530-002A

Applicants must provide their own reference materials.

Examinees may use any written reference material; however, use of any electronic device during the

exam other than a simple pocket calculator is strictly prohibited. Examples of prohibited devices

include, but are not limited to, scientific calculators and similar devices which have QWERTY

(keyboard-like) input or which allow anything in addition to numeric input, laptops or

portable/handheld computers, tablets, smart phones, or personal digital assistants (PDAs).
If you wish to receive automatic updates to this Q&A, select "Subscribe to Updates" on the left
side of this screen.

Qualifications for becoming a Customs Broker

Who can apply to become a licensed Customs Broker?

In order to obtain a broker's license, an individual must:

 Be a citizen of the United States on the date of submission of the license application and not an
officer or employee of the United States Government;
 Attain the age of 21 prior to the date of submission of the license application;
 Be of good moral character; and
 Hold a passing score on the broker's exam of 75% or higher.
To take the broker's exam, an applicant must be at least 18 years of age on the date the
examination. An applicant has three years after passing the broker's examination to apply for a
broker's license.
If you wish to receive automatic updates to this Q&A, select "Subscribe to Updates" on the left
side of this screen.

http://www.gov.ph/section/briefing-room/department-of-finance/bureau-of-customs/page/2/

BUREAU OF CUSTOMS
The Bureau of Customs (BOC) is an attached agency of the Department of Finance. It is charged
with assessing and collecting customs revenues, curbing illicit trade and all forms of customs
fraud, and facilitating trade through an efficient and effective customs management system.

No break, no holiday in Bureau of

Customs
By Kathleen Martin (The Philippine Star) | Updated August 17, 2015 - 12:00am

http://www.philstar.com/headlines/2015/08/17/1488973/no-break-no-holiday-bureau-customs

“There will be no regular non-working holidays for us in the bureau leading to Christmas,” Customs
Commissioner Alberto Lina said. File photo
MANILA, Philippines - Starting next month, the Bureau of Customs (BOC) will implement a “no-break, no-
holiday” policy in anticipation of more crowded ports for the Christmas season.

Customs Commissioner Alberto Lina said working hours at all ports nationwide will be from 7 a.m. until 7
p.m. with no noon breaks during weekdays. The BOC will also not take regular holidays so as to not miss
any business day.

“We will exhaust all means for an improved customs service delivery to a higher level committed to
reducing inefficiencies and delay. We intend for the ‘ber-months’ to pass by smoothly without any reports
of port congestion,” Lina said in a statement.

“There will be no regular non-working holidays for us in the bureau leading to Christmas,” he added.

Division chiefs will be in charge of the employees’ schedule to make sure there are no interruption in
BOC’s services. Employees will be divided in shifts with different lunch breaks so services will continue
within the new 12-hour frame.

http://www.lawphil.net/judjuris/juri2011/dec2011/gr_181704_2011.html

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. 181704 December 6, 2011

BUREAU OF CUSTOMS EMPLOYEES ASSOCIATION (BOCEA), represented by its National

President (BOCEA National Executive Council) Mr. Romulo A. Pagulayan, Petitioner,
vs.
HON. MARGARITO B. TEVES, in his capacity as Secretary of the Department of Finance,
HON. NAPOLEON L. MORALES, in his capacity as Commissioner of the Bureau of Customs,
HON. LILIAN B. HEFTI, in her capacity as Commissioner of the Bureau of Internal
Revenue, Respondents.

DECISION

VILLARAMA, JR., J.:

Before this Court is a petition1 for certiorari and prohibition with prayer for injunctive relief/s under
Rule 65 of the1997 Rules of Civil Procedure, as amended, to declare Republic Act (R.A.) No.
9335,2 otherwise known as theAttrition Act of 2005, and its Implementing Rules and
Regulations3 (IRR) unconstitutional, and the implementation thereof be enjoined permanently.

The Facts
On January 25, 2005, former President Gloria Macapagal-Arroyo signed into law R.A. No. 9335
which took effect on February 11, 2005.

In Abakada Guro Party List v. Purisima4 (Abakada), we said of R.A. No. 9335:

RA [No.] 9335 was enacted to optimize the revenue-generation capability and collection of the
Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC). The law intends to encourage
BIR and BOC officials and employees to exceed their revenue targets by providing a system of
rewards and sanctions through the creation of a Rewards and Incentives Fund (Fund) and a
Revenue Performance Evaluation Board (Board). It covers all officials and employees of the BIR and
the BOC with at least six months of service, regardless of employment status.

The Fund is sourced from the collection of the BIR and the BOC in excess of their revenue targets
for the year, as determined by the Development Budget and Coordinating Committee (DBCC). Any
incentive or reward is taken from the fund and allocated to the BIR and the BOC in proportion to their
contribution in the excess collection of the targeted amount of tax revenue.

The Boards in the BIR and the BOC are composed of the Secretary of the Department of Finance
(DOF) or his/her Undersecretary, the Secretary of the Department of Budget and Management
(DBM) or his/her Undersecretary, the Director General of the National Economic Development
Authority (NEDA) or his/her Deputy Director General, the Commissioners of the BIR and the BOC or
their Deputy Commissioners, two representatives from the rank-and-file employees and a
representative from the officials nominated by their recognized organization.

Each Board has the duty to (1) prescribe the rules and guidelines for the allocation, distribution and
release of the Fund; (2) set criteria and procedures for removing from the service officials and
employees whose revenue collection falls short of the target; (3) terminate personnel in accordance
with the criteria adopted by the Board; (4) prescribe a system for performance evaluation; (5)
perform other functions, including the issuance of rules and regulations and (6) submit an annual
report to Congress.

The DOF, DBM, NEDA, BIR, BOC and the Civil Service Commission (CSC) were tasked to
promulgate and issue the implementing rules and regulations of RA [No.] 9335, to be approved by a
Joint Congressional Oversight Committee created for such purpose.5

The Joint Congressional Oversight Committee approved the assailed IRR on May 22, 2006.
Subsequently, the IRR was published on May 30, 2006 in two newspapers of general circulation, the
Philippine Star and the Manila Standard, and became effective fifteen (15) days later.6

Contending that the enactment and implementation of R.A. No. 9335 are tainted with constitutional
infirmities in violation of the fundamental rights of its members, petitioner Bureau of Customs
Employees Association (BOCEA), an association of rank-and-file employees of the Bureau of
Customs (BOC), duly registered with the Department of Labor and Employment (DOLE) and the
Civil Service Commission (CSC), and represented by its National President, Mr. Romulo A.
Pagulayan (Pagulayan), directly filed the present petition before this Court against respondents
Margarito B. Teves, in his capacity as Secretary of the Department of Finance (DOF), Commissioner
Napoleon L. Morales (Commissioner Morales), in his capacity as BOC Commissioner, and Lilian B.
Hefti, in her capacity as Commissioner of the Bureau of Internal Revenue (BIR). In its petition,
BOCEA made the following averments:

Sometime in 2008, high-ranking officials of the BOC pursuant to the mandate of R.A. No. 9335 and
its IRR, and in order to comply with the stringent deadlines thereof, started to disseminate Collection
District Performance Contracts7 (Performance Contracts) for the lower ranking officials and rank-
and-file employees to sign. The Performance Contract pertinently provided:

xxxx

WHEREAS, pursuant to the provisions of Sec. 25 (b) of the Implementing Rules and Regulations
(IRR) of the Attrition Act of 2005, that provides for the setting of criteria and procedures for removing
from the service Officials and Employees whose revenue collection fall short of the target in
accordance with Section 7 of Republic Act 9335.

xxxx

NOW, THEREFORE, for and in consideration of the foregoing premises, parties unto this Agreement
hereby agree and so agreed to perform the following:

xxxx

2. The "Section 2, PA/PE" hereby accepts the allocated Revenue Collection Target and further
accepts/commits to meet the said target under the following conditions:

a.) That he/she will meet the allocated Revenue Collection Target and thereby undertakes
and binds himself/herself that in the event the revenue collection falls short of the target with
due consideration of all relevant factors affecting the level of collection as provided in the
rules and regulations promulgated under the Act and its IRR, he/she will voluntarily submit to
the provisions of Sec. 25 (b) of the IRR and Sec. 7 of the Act; and

b.) That he/she will cascade and/or allocate to respective Appraisers/Examiners or

Employees under his/her section the said Revenue Collection Target and require them to
execute a Performance Contract, and direct them to accept their individual target. The
Performance Contract executed by the respective Examiners/Appraisers/Employees shall be
submitted to the Office of the Commissioner through the LAIC on or before March 31, 2008.

x x x x8

BOCEA opined that the revenue target was impossible to meet due to the Government’s own
policies on reduced tariff rates and tax breaks to big businesses, the occurrence of natural calamities
and because of other economic factors. BOCEA claimed that some BOC employees were coerced
and forced to sign the Performance Contract. The majority of them, however, did not sign. In
particular, officers of BOCEA were summoned and required to sign the Performance Contracts but
they also refused. To ease the brewing tension, BOCEA claimed that its officers sent letters, and
sought several dialogues with BOC officials but the latter refused to heed them.

In addition, BOCEA alleged that Commissioner Morales exerted heavy pressure on the District
Collectors, Chiefs of Formal Entry Divisions, Principal Customs Appraisers and Principal Customs
Examiners of the BOC during command conferences to make them sign their Performance
Contracts. Likewise, BOC Deputy Commissioner Reynaldo Umali (Deputy Commissioner Umali)
individually spoke to said personnel to convince them to sign said contracts. Said personnel were
threatened that if they do not sign their respective Performance Contracts, they would face possible
reassignment, reshuffling, or worse, be placed on floating status. Thus, all the District Collectors,
except a certain Atty. Carlos So of the Collection District III of the Ninoy Aquino International Airport
(NAIA), signed the Performance Contracts.
BOCEA further claimed that Pagulayan was constantly harassed and threatened with lawsuits.
Pagulayan approached Deputy Commissioner Umali to ask the BOC officials to stop all forms of
harassment, but the latter merely said that he would look into the matter. On February 5, 2008,
BOCEA through counsel wrote the Revenue Performance Evaluation Board (Board) to desist from
implementing R.A. No. 9335 and its IRR and from requiring rank-and-file employees of the BOC and
BIR to sign Performance Contracts.9 In his letter-reply10 dated February 12, 2008, Deputy
Commissioner Umali denied having coerced any BOC employee to sign a Performance Contract. He
also defended the BOC, invoking its mandate of merely implementing the law. Finally, Pagulayan
and BOCEA’s counsel, on separate occasions, requested for a certified true copy of the
Performance Contract from Deputy Commissioner Umali but the latter failed to furnish them a copy.11

This petition was filed directly with this Court on March 3, 2008. BOCEA asserted that in view of the
unconstitutionality of R.A. No. 9335 and its IRR, and their adverse effects on the constitutional rights
of BOC officials and employees, direct resort to this Court is justified. BOCEA argued, among others,
that its members and other BOC employees are in great danger of losing their jobs should they fail
to meet the required quota provided under the law, in clear violation of their constitutional right to
security of tenure, and at their and their respective families’ prejudice.

In their Comment,12 respondents, through the Office of the Solicitor General (OSG), countered that
R.A. No. 9335 and its IRR do not violate the right to due process and right to security of tenure of
BIR and BOC employees. The OSG stressed that the guarantee of security of tenure under the 1987
Constitution is not a guarantee of perpetual employment. R.A. No. 9335 and its IRR provided a
reasonable and valid ground for the dismissal of an employee which is germane to the purpose of
the law. Likewise, R.A. No. 9335 and its IRR provided that an employee may only be separated from
the service upon compliance with substantive and procedural due process. The OSG added that
R.A. No. 9335 and its IRR must enjoy the presumption of constitutionality.

In its Reply,13 BOCEA claimed that R.A. No. 9335 employs means that are unreasonable to achieve
its stated objectives; that the law is unduly oppressive of BIR and BOC employees as it shifts the
extreme burden upon their shoulders when the Government itself has adopted measures that make
collection difficult such as reduced tariff rates to almost zero percent and tax exemption of big
businesses; and that the law is discriminatory of BIR and BOC employees. BOCEA manifested that
only the high-ranking officials of the BOC benefited largely from the reward system under R.A. No.
9335 despite the fact that they were not the ones directly toiling to collect revenue. Moreover,
despite the BOCEA’s numerous requests,14 BOC continually refused to provide BOCEA the
Expenditure Plan on how such reward was distributed.

Since BOCEA was seeking similar reliefs as that of the petitioners in Abakada Guro Party List v.
Purisima, BOCEA filed a Motion to Consolidate15 the present case with Abakada on April 16, 2008.
However, pending action on said motion, the Court rendered its decision in Abakada on August 14,
2008. Thus, the consolidation of this case with Abakada was rendered no longer possible.16

In Abakada, this Court, through then Associate Justice, now Chief Justice Renato C. Corona,
declared Section 1217 of R.A. No. 9335 creating a Joint Congressional Oversight Committee to
approve the IRR as unconstitutional and violative of the principle of separation of powers. However,
the constitutionality of the remaining provisions of R.A. No. 9335 was upheld pursuant to Section
1318 of R.A. No. 9335. The Court also held that until the contrary is shown, the IRR of R.A. No. 9335
is presumed valid and effective even without the approval of the Joint Congressional Oversight
Committee.19

Notwithstanding our ruling in Abakada, both parties complied with our Resolution20 dated February
10, 2009, requiring them to submit their respective Memoranda.
 The Issues

BOCEA raises the following issues:

I.

WHETHER OR NOT THE ATTRITION LAW, REPUBLIC ACT [NO.] 9335, AND ITS
IMPLEMENTING RULES AND REGULATIONS ARE UNCONSTITUTIONAL AS THESE VIOLATE
THE RIGHT TO DUE PROCESS OF THE COVERED BIR AND BOC OFFICIALS AND
EMPLOYEES[;]

II.

WHETHER OR NOT THE ATTRITION LAW, REPUBLIC ACT [NO.] 9335, AND ITS
IMPLEMENTING RULES AND REGULATIONS ARE UNCONSTITUTIONAL AS THESE VIOLATE
THE RIGHT OF BIR AND BOC OFFICIALS AND EMPLOYEES TO THE EQUAL PROTECTION OF
THE LAWS[;]

III.

WHETHER OR NOT REPUBLIC ACT [NO.] 9335 AND ITS IMPLEMENTING RULES AND
REGULATIONS VIOLATE THE RIGHT TO SECURITY OF TENURE OF BIR AND BOC OFFICIALS
AND EMPLOYEES AS ENSHRINED UNDER SECTION 2 (3), ARTICLE IX (B) OF THE
CONSTITUTION[;]

IV.

WHETHER OR NOT REPUBLIC ACT [NO.] 9335 AND ITS IMPLEMENTING RULES AND
REGULATIONS ARE UNCONSTITUTIONAL AS THEY CONSTITUTE UNDUE DELEGATION OF
LEGISLATIVE POWERS TO THE REVENUE PERFORMANCE EVALUATION BOARD IN
VIOLATION OF THE PRINCIPLE OF SEPARATION OF POWERS ENSHRINED IN THE
CONSTITUTION[; AND]

V.

WHETHER OR NOT REPUBLIC ACT [NO.] 9335 IS A BILL OF ATTAINDER AND HENCE[,]
UNCONSTITUTIONAL BECAUSE IT INFLICTS PUNISHMENT THROUGH LEGISLATIVE FIAT
UPON A PARTICULAR GROUP OR CLASS OF OFFICIALS AND EMPLOYEES WITHOUT
TRIAL.21

BOCEA manifested that while waiting for the Court to give due course to its petition, events unfolded
showing the patent unconstitutionality of R.A. No. 9335. It narrated that during the first year of the
implementation of R.A. No. 9335, BOC employees exerted commendable efforts to attain their
revenue target of P196 billion which they surpassed by as much as P2 billion for that year alone.
However, this was attained only because oil companies made advance tax payments to BOC.
Moreover, BOC employees were given their "reward" for surpassing said target only in 2008, the
distribution of which they described as unjust, unfair, dubious and fraudulent because only top
officials of BOC got the huge sum of reward while the employees, who did the hard task of
collecting, received a mere pittance of around P8,500.00. In the same manner, the Bonds Division of
BOC-NAIA collected 400+% of its designated target but the higher management gave out to the
employees a measly sum of P8,500.00 while the top level officials partook of millions of the excess
collections. BOCEA relies on a piece of information revealed by a newspaper showing the list of
BOC officials who apparently earned huge amounts of money by way of reward.22 It claims that the
recipients thereof included lawyers, support personnel and other employees, including a dentist, who
performed no collection functions at all. These alleged anomalous selection, distribution and
allocation of rewards was due to the failure of R.A. No. 9335 to set out clear guidelines.23

In addition, BOCEA avers that the Board initiated the first few cases of attrition for the Fiscal Year
2007 by subjecting five BOC officials from the Port of Manila to attrition despite the fact that the Port
of Manila substantially complied with the provisions of R.A. No. 9335. It is thus submitted that the
selection of these officials for attrition without proper investigation was nothing less than arbitrary.
Further, the legislative and executive departments’ promulgation of issuances and the Government’s
accession to regional trade agreements have caused a significant diminution of the tariff rates, thus,
decreasing over-all collection. These unrealistic settings of revenue targets seriously affect BIR and
BOC employees tasked with the burden of collection, and worse, subjected them to attrition.24

BOCEA assails the constitutionality of R.A. No. 9335 and its IRR on the following grounds:

1. R.A. No. 9335 and its IRR violate the BIR and BOC employees’ right to due process
because the termination of employees who had not attained their revenue targets for the
year is peremptory and done without any form of hearing to allow said employees to ventilate
their side. Moreover, R.A. No. 9335 and its IRR do not comply with the requirements under
CSC rules and regulations as the dismissal in this case is immediately executory. Such
immediately executory nature of the Board’s decision negates the remedies available to an
employee as provided under the CSC rules.

2. R.A. No. 9335 and its IRR violate the BIR and BOC employees’ right to equal protection of
the law because R.A. No. 9335 and its IRR unduly discriminates against BIR and BOC
employees as compared to employees of other revenue generating government agencies
like the Philippine Amusement and Gaming Corporation, Department of Transportation and
Communication, the Air Transportation Office, the Land Transportation Office, and the
Philippine Charity Sweepstakes Office, among others, which are not subject to attrition.

3. R.A. No. 9335 and its IRR violate the BIR and BOC employees’ right to security of tenure
because R.A. No. 9335 and its IRR effectively removed remedies provided in the ordinary
course of administrative procedure afforded to government employees. The law likewise
created another ground for dismissal, i.e., non-attainment of revenue collection target, which
is not provided under CSC rules and which is, by its nature, unpredictable and therefore
arbitrary and unreasonable.

4. R.A. No. 9335 and its IRR violate the 1987 Constitution because Congress granted to the
Revenue Performance Evaluation Board (Board) the unbridled discretion of formulating the
criteria for termination, the manner of allocating targets, the distribution of rewards and the
determination of relevant factors affecting the targets of collection, which is tantamount to
undue delegation of legislative power.

5. R.A. No. 9335 is a bill of attainder because it inflicts punishment upon a particular group or
class of officials and employees without trial. This is evident from the fact that the law confers
upon the Board the power to impose the penalty of removal upon employees who do not
meet their revenue targets; that the same is without the benefit of hearing; and that the
removal from service is immediately executory. Lastly, it disregards the presumption of
regularity in the performance of the official functions of a public officer.25
On the other hand, respondents through the OSG stress that except for Section 12 of R.A. No. 9335,
R.A. No. 9335 and its IRR are constitutional, as per our ruling in Abakada. Nevertheless, the OSG
argues that the classification of BIR and BOC employees as public officers under R.A. No. 9335 is
based on a valid and substantial distinction since the revenue generated by the BIR and BOC is
essentially in the form of taxes, which is the lifeblood of the State, while the revenue produced by
other agencies is merely incidental or secondary to their governmental functions; that in view of their
mandate, and for purposes of tax collection, the BIR and BOC are sui generis; that R.A. No. 9335
complies with the "completeness" and "sufficient standard" tests for the permissive delegation of
legislative power to the Board; that the Board exercises its delegated power consistent with the
policy laid down in the law, that is, to optimize the revenue generation capability and collection of the
BIR and the BOC; that parameters were set in order that the Board may identify the officials and
employees subject to attrition, and the proper procedure for their removal in case they fail to meet
the targets set in the Performance Contract were provided; and that the rights of BIR and BOC
employees to due process of law and security of tenure are duly accorded by R.A. No. 9335. The
OSG likewise maintains that there was no encroachment of judicial power in the enactment of R.A.
No. 9335 amounting to a bill of attainder since R.A. No. 9335 and its IRR merely defined the offense
and provided for the penalty that may be imposed. Finally, the OSG reiterates that the separation
from the service of any BIR or BOC employee under R.A. No. 9335 and its IRR shall be done only
upon due consideration of all relevant factors affecting the level of collection, subject to Civil Service
laws, rules and regulations, and in compliance with substantive and procedural due process. The
OSG opines that the Performance Contract, far from violating the BIR and BOC employees’ right to
due process, actually serves as a notice of the revenue target they have to meet and the possible
consequences of failing to meet the same. More, there is nothing in the law which prevents the
aggrieved party from appealing the unfavorable decision of dismissal.26

In essence, the issues for our resolution are:

1. Whether there is undue delegation of legislative power to the Board;

2. Whether R.A. No. 9335 and its IRR violate the rights of BOCEA’s members to: (a) equal
protection of laws, (b) security of tenure and (c) due process; and

3. Whether R.A. No. 9335 is a bill of attainder.

http://pcij.org/imag/Life&Times/customs.html

“Side payments” are the accustomed way of doing things at the Bureau of
Customs.
by Emil Bolongaita

OF COURSE I was aware of the Bureau of Customs' reputation for

being corrupt. But after four years in antiseptic Singapore, you couldn't
fault me for being hopeful things would be different. It's not as if I hadn't
been warned. Che, a representative of the firm that took care of
shipping my stuff, had told me early on that it was likely that I would be
expected to make "side payments" to Customs officials. Everyone, she
said, went through a shakedown.
In the nine years she had been with the freight company, Che had never facilitated the processing of a
shipment without making pay-offs to Customs officials. "Everyone pays," she said. The practice is to "give
to everybody, even to the clerks, who will call your attention if you pass by their desks without giving them
something, at least P20 to P50."

"It's really like a market there," she remarked, "because they would even give you change for the bill you
give them; say, if you give P100 to a clerk, she'll give you back P80 as change."

After hearing that, I should have steeled myself better for what was to come. But having taught courses
on governance and corruption, I was determined to pay only what was really due the government. This, I
thought, should be simple enough to do. After all, my shipment consisted of personal effects, bits and
pieces of an academic's life in a small city-state. And there was that sign above the entrance of the
Customs office that proclaimed, "You are now entering a world-class facility."

Rax, another employee of the freight company, met Che and I at the Customs office. After passing
through two floors of employees seemingly doing everything — reading newspapers, chatting with one
another, daydreaming — but work, I was introduced to Mr. Figo, who shook my hand as he sized me up.
Figo called two of his staff, Richie and Edna, and told them to inspect my shipment.

We took my car to go to the Customs warehouse, just a few minutes away. During the short drive, I asked
the two Customs employees how their work was going under the new commissioner. After a few seconds
of silence, Edna said, "No comment." Several more seconds later, she followed that up with, "It doesn't
really make a difference who sits at the top." I would find out just a few minutes later how true that was.

ROBERT Klitgaard once wrote that corruption is the result of monopoly plus discretion minus
accountability. This description fits to a T the customs process that I was to experience. The problem with
corruption is not so much monopoly or discretion but accountability. Governments, by definition, are
monopolies. There is only one State in a country. No competing entities are allowed, at least not without a
fight. The State, of course, can have a government that is run with competitive characteristics, and that is
what it needs to do to perform well. In the end, it is still a monopoly. But not all states are corrupt to the
core. Many states have succeeded in transforming their societies and economies precisely because of
their effective use of monopoly power. You just have to look at the advanced industrial democracies or
the East Asian countries.

Discretion is not necessarily bad, either. A good deal of discretion, in fact, is necessary if a government
wants to be effective and efficient. Without discretion, there would be little governmental flexibility in
responding to fast-changing circumstances in an increasingly globalized environment. Discretion is, as
Peter Drucker once said, critical for effectiveness.

It is accountability that must be maintained, reinforced, and increased. Without accountability — however
that is achieved — the monopoly and discretion that government organizations possess will be abused for
the personal benefits of officials. Depending on the quality of institutions in a country, the corruption can
be mild to severe. The corruption can be limited to petty matters, or it can also extend to grand corruption,
when the state is, more or less, captured by private interests. That is to say, that state policies and
programs are purchased by private interests to the benefit of officials and the detriment of the public
good.

I was hardly thinking of all these while I stood waiting for the inspection to begin at the warehouse. I was
still thinking I would somehow get the proper assessment of the duties I would have to pay so I could get
my stuff. Then Rax began talking to Richie and Edna. With a glance, he brought me into the conversation,
and in a roundabout manner told me I had to decide whether things would be done the official way —or
the other. What I chose to do at that point, he said, would make a difference in terms of how quickly we
could move my shipment. I tensed up. I curtly told Rax I was prepared to pay whatever the official duty
assessment was. Edna gave me a forced smile. Richie then said there would be a "100-percent
inspection," meaning each one of my crates would be opened. Edna piped up, "Actually, we don't have to
open all of them. It's up to us." When I remained silent, Edna signaled to the warehouse workers to start
opening the crates.

The crates were to be opened one at a time and checked whether the contents matched the inventory list.
After opening some boxes in the first crate, one of the workers asked me directly whether I still wanted
more boxes to be opened. I ignored him. Edna told them to move on to the next crate. I felt I was being
observed by everybody there, to see if I would just say, enough of this, let's just cut a deal to get this over
with. But I decided to simply stand there and watch. Edna asked me how long I had had my DVD player. I
said more than three years. She then asked for the box containing it to be located and opened. As if she
were trying to call a bluff, as if I were lying about its age. Two workers wriggled their way into the crate
looking for the box, when suddenly one of the workers said it was no longer necessary — taking his cue it
seemed from Richie and Edna who weren't paying attention at all. It had finally dawned on them that I
wasn't going to intervene in letting them do their jobs.

My crates were then nailed shut, but I had to wait 30 minutes more as Edna and Richie inspected another
shipment. We got back at the Customs office at 11 a.m., and I noticed that several people were still
waiting to conduct and conclude whatever business they had there. But many of the employees —
including Mr. Figo — were already eating lunch right at their desks

Edna asked me to wait, as her boss was still eating. But she probably noticed my annoyance at this,
because she stood quickly to confer with Figo, who was still chomping away. When Edna returned, she
told me her boss had assessed the dutiable value of the shipment at $500. Well, I asked her, what's the
basis for this amount, where are the specifics? Instead of answering, she stood up again, bringing the
inventory list to Figo. She was back after a few minutes; the total amount was now $455. I asked her why
the sudden drop, and how were these values arrived at? She said they know the values of items based
on their records. I then asked to see the records, but Edna replied that she didn't have them - and could I
come back at one p.m.? I said, no, it's only 11:15. I thought she was really looking uncomfortable as she
was wiping sweat off her face and neck. I was beginning to feel a lot of eyes on me as well.

I asked for the basis of the assessment of $300 for my wife's personal computer, which was more than
two years old. Edna said to talk to her boss, so I excused myself and walked over to Figo. I told him I was
questioning the assessments of the items. Why are some items assessed, not others? Figo said, "You
should be happy that we're not assessing the others." But what about the computer assessment? I asked.
I said the valuation seemed to me rather high for an old computer. Figo's reply: "What if I cut that to $150,
will you be happy?" I was stunned at how completely discretionary the whole process was. But I managed
to say, "Whatever is the right assessment is what I want."

Someone then came up and introduced himself as Mr. Ting. "What's the problem?" he asked. "Can I
help? You know, you will be given an official receipt for this. The money goes to the government." I said
that, yes, I understand that. I don't mind giving more money to the government, really, if the assessment
is right.

I told Ting that I was questioning the following assessments: $50 for a three-year-old washing machine,
$20 for a pair of two-year-old stereo speakers, $20 for an old exercise bicycle, $50 for a three-year-old
computer monitor, $300 for a two-year-old computer, $5 each for a used breadmaker and cutlery, an
office chair, and a picture and ornament. I asked Ting, What is the basis for such valuations? Why are
similar items not considered dutiable? It seemed too arbitrary. Is there not a more systematic way? Can't
the process be more efficient? I have been here for almost three hours, I said.

Ting responded by asking me what the value of my shipment was. I said I had the shipment insured for
about S$24,000, which one of his staff said was equivalent to some US$13,000. Ting turned back to me,
saying, "Now compare this amount with the US$455 that we are assessing you. With this difference in
insurance value and assessed value, are you not getting a good deal here?" I argued that the issue was
not the difference, and that the insured value doesn't determine the dutiable value. What I wanted, I said,
was for the dutiable value to be assessed accurately. But Ting said with some finality, "That's our
assessment."

I suppose I could have been friendly and tried to bargain for a lower assessment, seeing the officials'
extreme discretionary authority. But I was very disturbed with the self-serving explanations and the
atmosphere of under-the-table deal making that seemed to prevail in the office. So I stood up, gave
perfunctory thanks, and said, I'll pay on the basis of the revised valuation. Ting and Figo then seemed to
me to exude a look of triumph, of having dealt successfully with a pesky smart ass.

I would later get several different answers from several different Customs people on what was dutiable
and what was not. I tried to seek help from my local freight company, but no one there could give me a
definite answer either. Frustrated, I told the one who received my call at the freight firm that their duty as
brokers was precisely to help in this regard, not the kind of help that Rax was offering to give at the
warehouse. I ended the call by telling the company to hold off any payment of any duty until I let them
know that the issues had been clarified.