Basic information
Outline of the system
The electronic Certificate of Authority to Import (e-CAI) is required for the importation of completely knocked down (CKD) parts and components at 0% to 1% tariff duty (hereinafter referred to as "CKD tariff rate") under the Motor Vehicle Development Program (MVDP), which is implemented by the Board of Investments (BOI). Only brand-new CKD parts and components sourced from a foreign Original Equipment Manufacturer (OEM) shall be allowed for importation under the MVDP by registered participants with approved model registrations. The BOI is responsible for the evaluation and approval of applications for participation in the MVDP, as well as the subsequent evaluation and approval of model registrations.
The e-CAI is issued by the BOI on a per shipment basis through a designated third-party network service provider prior to importation.
Product coverage
The e-CAI system regulates the importation of CKD parts and components at CKD tariff rate, which is limited only to registered MVDP participants. The imported CKDs refer to sub-parts/parts and sub-assemblies/assemblies/components minus local parts and components, as may be determined by the BOI.
The HS codes of the MVDP tariff lines may be found under AHTN 2017 subheadings 8702.90, 8703.80, 8703.90, 8704.90, 8711.60, and 8711.90 (Please see Products or Annex F for the complete list).
Annex F - HS codes of the MVDP tariff lines.pdfNature of licensing
Automatic
If Automatic, administrative purpose
Automatic licensing to regulate the importation of knocked down parts and components at 0-1% duty for MVDP participants
Non-Automatic
If Non-Automatic, description of the notified Non-Automatic Licensing regime
Products under restriction as to the quantity or value of imports
The e-CAI system does not intend to restrict the quantity or value of imported CKD parts and components.
Questions for products under restriction as to the quantity or value of imports
No quota restrictions applicable.
The system applies to products originating from which country?
The e-CAI applies to the importation of CKD parts and components originating in and coming from all countries, without exceptions.
Expected duration of licensing procedure
Ongoing
Legal requirements
Is the licensing statutorily required?
The legal basis for the issuance of the e-CAI is Executive Order (EO) No. 156, series of 2002 entitled Providing for a Comprehensive Industrial Policy and Directions for the Motor Vehicle Development Program and its Implementing Guidelines. The MVDP covers the production and/or assembly of motor vehicles and other vehicle assemblies in knocked down condition, which is aimed at promoting high value added in motor vehicle manufacturing and high degree of vehicle production operations.
Does the legislation leave designation of products to be subject to licensing to administrative discretion?
Is it possible for the government to abolish the system without legislative approval?
Eligibility of applicants
Is there a system of registration of persons or firms permitted to engage in importation?
The BOI is responsible for evaluating and approving applications for registration under the MVDP. Upon approval of application, newly-registered participants in the MVDP are issued with a Certificate of Registration by the BOI, after which the BOI conducts an inspection of their local assembly/manufacturing facility. On the registration of models for assembly and/or manufacture, there is no limitation on the number of models that a participant may register with the BOI; however, the same model shall not be allowed for registration under two different participants.
What persons or firms are eligible to apply for a licence?
Only registered participants of the MVDP with approved model registrations by the BOI are eligible to apply for the e-CAI and subsequently import CKD parts and components at CKD tariff rate.
Is there a registration fee?
The filing fee for application of registration in the MVDP is PHP 50,000 for Classification I & II, and PHP 30,000 for Classification III. The filing fee for application of registration for participating models (per basic and/or variant model of motor vehicle) is PHP 5,000 for Classification I & II, and PHP 3,000 for Classification III.
Is there a published list of authorized importers?
There is no published list of MVDP participants and registered models of motor vehicles for assembly and/or manufacture.
Contact point for information on eligibility
Ministry/Authority
Department of Trade and Industry, Board of Investment
Address
Industry & Investments Bldg., 385 Sen. Gil J. Puyat Avenue, Makati City, Philippines 1200
Telephone
(02) 897-6682
Fax
Contact officer
Submission of an application
Administrative body(ies) for submission of an application
Department of Trade and Industry, Board of Investment
Documentation requirements
What information is required in applications?
The application for the e-CAI is completed online through the BOI Trade System using the participant's account. The online system allows the participant to simply tick or select the required information with respect to the importation. This includes the vehicle model and the quantity to be imported, as well as the specific CKD parts and components. The technical details such as the HS codes and specific HS descriptions are automatically generated upon selection of the vehicle model and its CKD parts and components.
What documents is the importer required to supply with the application?
Window of submission of an application
How far in advance of importation must application for a licence be made?
The participant must apply for the e-CAI in advance of the importation.
Are there any limitations as to the period of the year during which application for licence can be made? If so, explain
There are no limitations as to the period of the year during which application for e-CAI and subsequent importation may be made.
Issuing the license
Can a licence be granted immediately on request?
The e-CAI is granted automatically and issued immediately upon application.
Can licences be obtained within a shorter time-limit or for goods arriving at the port without a licence
The e-CAI is issued automatically upon application and should be used within 90 days from the date of issuance; otherwise, the e-CAI will be forfeited.
Which administrative body is responsible for approving application of licences?
Application for the e-CAI and issuance thereof is effected by the BOI through the BOI Trade System, an automated import documentation system developed and maintained by InterCommerce Network Services Inc. (hereinafter referred to as "InterCommerce"). The conditions of eligibility to apply for the e-CAI are decided upon by the BOI, i.e. approval of participation in the MVDP and approval of model registration of the participant.
Must the applications be passed on to other organs for visa, note or approval?
Upon approval of a participant's registration in the MVDP, said participant is advised to enrol in the BOI Trade System for access to their registration documents and subsequent import transactions, which includes the application for and issuance of the e-CAI.
Are there any other conditions attached to the issue of a licence?
There are no other conditions attached to the issuance of the e-CAI apart from the conditions specified above.
Fees and other administrative charges
Is there any licensing fee or administrative charge?
The issuance of the e-CAI requires a processing fee payment of which is completed online through an auto-debit facility immediately upon application for the e-CAI.
What is the amount of the fee or charge?
A processing fee of PHP 650.00
Is there any deposit or advance payment required associated with the issue of licences?
A participant may opt to make advance deposits to the online fund linked to the BOI Trade System, from which the processing fee for the e-CAI is auto-debited per transaction.
Please refer to https://boi.gov.ph for further information.
Amount or rate?
Is it refundable?
What is the period of retention?
What is the purpose of this requirement?
Refusal of an application
Under what circumstances may an application for a licence be refused other than failure to meet the ordinary criteria?
Issuance of the e-CAI to a participant may be refused due to violation of the terms and conditions of its registration under the MVDP, as laid out in EO No. 156.
Are the reasons for any refusal given to applicants?
In such cases, the participant is informed by the BOI of the reason for refusal, as well as the steps that may be taken to regain compliance with the terms and conditions of its registration.
Have applicants a right of appeal in the event of refusal to issue a licence?
In such cases, the participant is informed by the BOI of the reason for refusal, as well as the steps that may be taken to regain compliance with the terms and conditions of its registration.
If so, to what bodies and under what procedures?
Importation
Are there any limitations as to the period of year during which importation may be made?
There are no limitations as to the period of the year during which application for e-CAI and subsequent importation may be made.
What documents are required upon actual importation?
Aside from the e-CAI, there are no further documents required upon actual importation other than the documents and information required in accordance with Philippine customs procedures by virtue of Republic Act No. 10863, s. 2016 or the Customs Modernization and Tariff Act.
Are there any other administrative procedures, apart from import licensing and similar administrative procedures, required prior to importation?
There are no other administrative procedures required prior to importation of CKD parts and components at CKD tariff rate under the MVDP.
Conditions of licensing
What is the period of validity of a licence? Can the validity be extended? How?
The e-CAI may be used only once on a per shipment basis. The e-CAI is valid within 90 days from the date of issuance and cannot be extended. If the e-CAI remains unused within 90 days from the date of issuance, the e-CAI will be forfeited and the participant must apply for a new e-CAI.
Is there any penalty for the non-utilization of a licence or a portion of a licence?
There is no penalty for the non-utilization of the e-CAI. However, the e-CAI will be forfeited if not used within 90 days from the date of issuance.
Are licences transferable between importers? If so, are any limitations or conditions attached to such transfer?
The e-CAI is non-transferrable between and among importers.
Foreign Exchange
Is foreign exchange automatically provided by the banking authorities for goods to be imported?
There is no provision under the MVDP that provides for the treatment of balance-of-payments. However, as a general rule, except under conditions of a national emergency or an economic crisis that threaten among others the stability of the balance-of-payments, a holder of an import license may purchase foreign exchange from authorized agent banks to pay for the importation in accordance with BSP rules.