Customs Modernization and Tariff Act

Section 1139

Goods in customs custody that are in the following conditions and status shall be subject to disposition: (a) Abandoned goods; (b) Goods entered under warehousing entry but not withdrawn, or those whose duties and taxes have not been paid within the period prescribed under Section 811 of this Act; (c) Forfeited goods, other than prohibited, restricted and regulated goods; after liability have been established by the proper administrative or judicial proceedings in conformity with the provisions of this Act; and (d) Goods subject to a valid lien for customs duties, taxes and other charges collectible by the Bureau, after the expiration of the period allowed for payment thereof.

Section 1140

Upon the order of the District Collector, goods may be sold or otherwise disposed of at the port where the goods are located, unless the Commissioner shall direct its transfer to another port.

Section 1141

The goods subject to disposition may be donated to another government agency or declared for official use of the Bureau, after approval of the Secretary of Finance, or sold at a public auction within thirty (30) days after a ten (10)-day notice posted at a public place at the port where the goods are located and published electronically or in a newspaper of general circulation. For purposes of donating the goods as above described, goods suitable for shelter or consisting of foodstuffs, clothing materials or medicines may be donated to the DSWD.

Section 1142

No customs officer or employee, their spouses and relatives within the fourth degree of consanguinity or affinity shall be allowed to bid directly or indirectly, in any customs auction.

Section 1143

The following expenses and obligations shall be paid from the proceeds of the sale in the order provided: (a) Customs duties, except in the case of forfeited goods; (b) Taxes and other charges due the government; (c) Government storage charges; (d) Expenses for the appraisal, advertisement, and sale of auctioned goods; (e) Arrastre and private storage charges and demurrage charges; and (f) Freight, lighterage or general average, on the voyage of importation, of which due notice shall have been given to the District Collector. The Commissioner is authorized to determine the maximum charges to be recovered by private entities concerned under subsections (e) and (f) of this section.

Section 1144

Perishable goods as defined under this Act when certified as such by the Bureau, may be sold at a public auction within five (5) days, after a three (3)-day notice. For this purpose, perishable goods shall include goods liable to perish or be wasted, or those that depreciate greatly in value while stored, or which cannot be kept without great disproportionate expense. The Bureau shall proceed to advertise and sell the same at auction upon notice as shall be deemed to be reasonable.

Section 1145

Goods in the custody of the Bureau which, in the opinion of the District Collector are injurious to public health, shall be seized. The District Collector shall, if the matter is not disposable under the provisions relating to food and drugs, appoint three (3) members to constitute a Board to examine the goods. The Board shall be composed of one (1) representative from either the DOH or other appropriate government agency or the local government unit (LGU) concerned, and two (2) representatives from the Bureau. If the goods are found to be injurious to public health, the Board shall report this to the District Collector, who shall order its destruction in an appropriate manner or order its re-exportation in accordance with this Act. The District Collector shall immediately coordinate with the health and quarantine officers at the port of entry for the disposition of goods injurious to public health. SECTION 1146 Disposition of Prohibited Goods. — Prohibited goods, as provided in Section 118 of this Act, shall be destroyed, except paragraph (d) thereof which shall be turned over to the BSP. All goods suitable for shelter, foodstuffs, clothing materials or medicines may be disposed in accordance with Section 1141 of this Act.

Section 1147

Restricted goods as described in Section 119 of this Act shall be disposed as follows: (a) Dynamite, gunpowder, ammunitions and other explosives, firearms and weapons of war, and parts thereof shall be turned over to the AFP; (b) Roulette wheels, gambling outfits, loaded dice, marked cards, machines, apparatus or mechanical devices used in gambling or the distribution of money, cigars, cigarettes, or other goods when such distribution is dependent on chance, including jackpot and pinball machines or similar contrivances, or parts thereof shall be turned over to the appropriate government body or agency; (c) Lottery and sweepstakes tickets, except advertisements thereof, and lists of drawings therein shall be turned over to the appropriate government body or agency; (d) Marijuana, opium, poppies, coca leaves, heroin, or other narcotics or synthetic drugs which are or may hereafter be declared habit forming by the President of the Philippines, or any compound, manufactured salt, derivative, or preparation thereof, shall be turned over to the Dangerous Drugs Board; (e) Opium pipes and parts thereof, of whatever material, shall be turned over to the Dangerous Drugs Board; and (f) All other restricted goods which are highly dangerous to be kept or handled shall be destroyed in a manner as the District Collector deems appropriate. Otherwise, the restricted goods shall be turned over to the proper government agency for appropriate handling.

Section 1148

Regulated goods shall be disposed of in a manner to be determined by the appropriate regulatory agency. In the event that the regulatory agency allows the disposition of the regulated goods with commercial value and capable of legitimate use, these shall be disposed of in accordance with Section 1141 of this Act.

Section 1149

Goods subject to sale at public auction by the Bureau shall be sold at a price not less than the landed cost of the goods adjusted for normal depreciation. Goods which remain unsold after at least two (2) public biddings either due to the lack of bidders or for the lack of an acceptable bid, may be donated to another government agency or declared for official use of the Bureau. If the goods are not suitable either for official use or donation, these may be subject to re-export as government property or sold through a negotiated sale. In case of negotiated sale, the same shall be subject to the approval of the Secretary of Finance and executed in the presence of a representative of the COA. For purposes of donating the goods as above described, goods suitable for shelter or consisting of foodstuffs, clothing materials or medicines may be donated to the DSWD.

Section 1150

Smuggled goods, when forfeited, shall be disposed of as provided in Section 1148 of this Act.

Section 1151

All proceeds from public auction sales after deduction of the charges as provided in Section 1143 of this Act and subject to the claim of the owner or importer of an impliedly abandoned goods as provided in Section 1130 of this Act, shall be deposited in an account to be known as Forfeiture Fund. The Fund shall be in the name of and shall be managed by the Bureau which is hereby authorized, subject to the usual government accounting rules and regulations, to utilize it for the following purposes: (a) To outsource, subject to the rules on government procurement established by law, the management of the inventory, safekeeping, maintenance and sale of goods enumerated in Section 1139 of this Act to private service providers: Provided, That the Bureau shall retain jurisdictional control and supervision over these goods as well as the operations of the service provider so contracted; (b) To facilitate customs seizure, abandonment and forfeiture proceedings and the disposition of goods under Section 1139 of this Act, particularly those to be disposed of other than through public sale; (c) To enhance customs intelligence and enforcement capability to prevent smuggling; and (d) To support the modernization program and other operational efficiency and trade facilitation initiatives of the Bureau. The DOF and the Department of Budget and Management (DBM) shall, upon the recommendation of the Bureau, issue a joint regulation to implement the provisions of this section.