One of the earliest recordings of Philippine history contain examples of how the datus and rajahs of old bartered with traders from distant lands. This practice led to the relative wealth and prosperity of the country at the time, created long-lasting connections with the country’s neighbors, and laid the foundation for what would become the customs system.
Today, centuries later, the Bureau of Customs (BoC) continues in this tradition, cultivating new alliances and paving a path towards shared prosperity by upholding a responsive, adaptive, and resilient customs administration that collaborates and engages with all of its stakeholders.
All ten Customs Administrations of ASEAN Member States, including the Philippines, signed the Mutual Recognition Arrangement for their Authorized Economic Operator (AEO) Programs to establish a transparent trading environment last year.
Meanwhile, the BoC also collaborated with the United States Agency for International Development’s ASEAN Policy Implementation (API) to enhance customs practices and develop synergies with other ASEAN member countries.
This is not to mention the numerous events, discussions and assemblies that the organization participated in and hosted last year, which include: the 34th Meeting of the ASEAN Customs Procedures and Trade Facilitation Working Group, the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area Trade Facilitation Cluster, the 31st Meeting of the ASEAN Single Window Steering Committee, to further boost international relations, broaden networks, and enhance customs management through knowledge and best practice sharing.
Commissioner Bienvenido Y. Rubio delivered a congratulatory message to 113 loyalty awardees and 58 customs officers who completed their post-graduate degrees in 2023 during the fourth flag-raising ceremony of the BoC this year. — Photo from facebook.com/BureauOfCustomsPH
“The BoC stands at the forefront of championing economic growth and securing the sustainability of the supply chain. With this, we recognize our immense responsibility to consistently develop and formulate new means in which we can build stronger alliances for a more progressive customs management,” Commissioner Bienvenido Y. Rubio said.
It stands to reason that such efforts will lead to better trade and commerce between ASEAN member states. Last year, the bureau had collected P883.624 billion, surpassing its P874.16 billion target by 1.08%, according to the Department of Finance.
“I commend the BoC for its outstanding performance in 2023. In 2024, expect the bureau to continue modernizing its customs administration and processes to effectively curb illicit trade, generate more revenues to fund the government’s priority development projects, ensure the protection of our consumers, and enhance the country’s ease of doing business,” Former Finance Secretary Benjamin E. Diokno said.
Moving forward, Mr. Rubio raised their goal to P959 billion for 2024, focusing on increasing collections by continuing its fight against smuggling and the continuous improvement of modernization projects.
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Key among these initiatives is the Enhanced Value Reference Information System (e-VRIS), which is a critical risk assessment tool for safeguarding government revenues and facilitating trade. The BoC is also actively working on implementing an ICT-enabled clearance system for express shipments and in the process of drafting Customs Administrative Orders (CAO) and Customs Memorandum Orders (CMO) for e-Commerce to prevent revenue leakages.
A long, storied history
The Philippine customs system during the Spanish rule underwent many significant changes that led to its current evolution. When the Spanish Customs Law of 1582 was introduced, it marked the beginning of a more formalized customs process in the country. This period also saw the establishment of a Tariff Board, which standardized duties on imports, a practice that continued until the end of Spanish rule.
The American colonial period brought further transformations. The Americans initially enforced the Spanish Tariff Code of 1891 but soon enacted the Tariff Revision Law of 1901 to align the customs services with American practices. This era witnessed the restructuring of customs positions and the creation of the Bureau of Customs and Immigration under the Department of Finance and Justice — a significant step in the evolution of the customs service in the Philippines.
Post-World War II and the establishment of the Commonwealth Government saw the Bureau of Immigration separated from Customs; and, in 1957, the Tariff and Customs Code of the Philippines (Republic Act No. 1937) was enacted. This act was a landmark in the history of the bureau, as it represented the first autonomous Philippine Tariff Policy.
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The bureau underwent a major reorganization in 1965, which streamlined its operations and elevated several offices to departmental levels. The period of Martial Law in the country saw further amendments to the customs code, with significant changes being introduced by Presidential Decree No. 34 in 1972.
The bureau saw another pivotal moment in 1986 in the form of Executive Order No. 127, which further led to a comprehensive reorganization down the line, expanding the bureau’s structure and introducing technological advancements, including the establishment of the Management Information System and Technology Group (MISTG) in 1998.
A key component of the bureau’s evolution has been the Enforcement and Security Service (ESS), established to combat smuggling and enforce customs laws. From its early days as the Harbor Police in 1902 to its current form, the ESS has been instrumental in securing the nation’s borders and safeguarding revenue.
Since then, a key focus for the bureau has been combating corruption and smuggling, perennial challenges in customs administration. Various measures, including stricter enforcement of laws, enhanced port surveillance, and internal reforms, have been implemented to address these issues. Legislative reforms and policy changes have also been a constant feature, aligning the bureau’s operations with the broader economic policies of the Philippine government and global trade practices.
The bureau’s efforts to align with international customs standards have involved collaboration with international agencies and adherence to global regulations, facilitating smoother international trade. Capacity building and training of personnel, meanwhile, have been crucial in keeping up with the demands of modern customs administration, encompassing new technologies, international practices, and ethical standards.
Public engagement and transparency have become increasingly important, reflecting broader governance reforms in the Philippines. Reflecting this, the bureau’s operations have become more transparent and accessible, aiming to foster public trust and accountability. Additionally, the bureau has had to navigate various global and regional changes, including shifts in trade patterns and economic crises, adapting its strategies and operations accordingly.
The COVID-19 pandemic presented unique challenges, with the bureau playing a pivotal role in managing the flow of essential goods under new health and safety protocols. This period underscored the bureau’s agility and responsiveness to unprecedented global events.
Ongoing modernization efforts continue to shape the bureau, with a focus on improving efficiency, reducing bureaucracy, and enhancing the effectiveness of customs processes. These efforts reflect the bureau’s commitment to adapting to changing times while maintaining its core functions in customs administration.
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Perhaps one of the most significant is how it attempted to modernize border security and streamlining operational processes through the National Customs Intelligence System (NCIS) that launched in December last year.
The NCIS, developed by BoC’s Management Information Systems and Technology Group (MISTG) upon the initiative of the Intelligence Group, will serve as a secured data warehouse for intelligence information from various units of the agency. It provides a database to generate actionable intelligence information, and support case build-up, risk profiling, and analysis.
The system’s capabilities extend to equipping authorized officials with data-driven insights, thereby enhancing the bureau’s operational efficiency and effectiveness and reinforcing its ability to better safeguard national borders and facilitate international trade.
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With the launch of the NCIS, the bureau has taken a giant leap forward in its intelligence capabilities, ushering in a new age of effective and efficient management of intelligence activities. With the system up and running, BoC can face the future with more intelligence, more resilience, and unwavering commitment to paving the nation’s path to progress. — Bjorn Biel M. Beltran