How To Secure Bir Importer Clearance Certificate 5q1o25

How to secure BIR Importer Clearance Certificate (ICC) TOPICS:BIR ICCEFPSICCImporter Clearsnce CertificateOpen CMS CaseSEC Good Standing

POSTED BY: AMPALARCA AUGUST 30, 2016 Regulatory Background You may skip this part and go straight to the next sub-heading. But I encourage you to read it for additional information. In order for companies to become importers, they need to be accredited by the Bureau of Customs (BoC). Previously, getting accreditation is easy and fast. However in 2014, with the aim to combat smuggling, the following regulatory issuance came about: No. 1

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Agency Issuance Department Department Order (DO) of Finance No. 12-2014 (DOF)

DOF

Amended DO No. 12-2014

Description Requires importers to secure an Importer Clearance Certificate (ICC) from the Bureau of Internal Revenue (BIR) as a pre-requisite for accreditation with the BoC. To include custom brokers in its coverage – the Broker’s Clearance Certificate (BCC)

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BIR

Revenue Memorandum Order (RMO) No. 102014

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BIR

RMO No. 33-2014

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DOF

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BIR

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BIR

Provides for the requirements and guidelines for the ICC and BCC applications. The applications are coursed through the BIR- s Receivable and Monitoring Division (ARMD) [later revised in number 7]. Requires PEZA and BOI companies to present certificate of registration from respective investment promotion agencies

DO No. 107-2014 Exempts PEZA locators from securing ICC in order to be Revenue Memorandum accredited by BoC Circular No. 4-2015

RMO No. 1-2015

Reduces the documentary requirements for ICC/BCC applications Requires applicant to secure directly the annex/compliance certificates from the different BIR agencies before filing for the ICC/BCC with the BIRARMD. The memo goes away with certified (photocopy suffices) BIR CoR and SEC registration and AOI.

What are important items that need to be considered to expedite the ICC application process? The 1.5 months’ timeline is based on the following assumption: a. that the taxpayer is already using the Electronic Filing and Payment System; b. is compliant with SEC reportorial requirement; and c. and has minimal or no open cases with BIR as discussed further below. Before or simultaneous with preparation or collating of documents needed for ICC application, the following sub-processes needs to be considered: 1. Application for certificate of good standing with SEC; 2. Closure of Open Case per BIR Case Monitoring System (CMS); and 3. eFPS enrolment with BIR; The above are discussed as follows: 1. Application for certificate of good standing with SEC Actually, this is a requirement in the final application with ICC, but I opted to discuss and emphasize it first because this is needed to be applied to SEC and will take at least 2 weeks before it can be released after settling all non-compliance with SEC. Meaning, if a taxpayer has not been submitting all required reports to SEC, it will be required to submit what has not been submitted and pay the penalties thereof, before the certificate of good standing can be released. 2. Closure of Open Case per BIR Case Monitoring System (CMS) The initial application for Certificate Annex A will not prosper if the client has open cases in the CMS. A taxpayer with a copy of COR may inquire of CMS open cases with the BIR anytime. For some RDOs they require an application for good standing before a CMS can be printed. Any open cases should be closed in the system, of if it takes a long time, a letter should be stamped received by BIR stating how all remaining open cases were resolved, pending system update. 3. EFPS enrolment with BIR An importer is required to be ed with eFPS and is using the same for two months, yes, two long months before it can apply for ICC. During the final application at ARMD, copies of 2 BIR forms submitted using the eFPS for at least 2 months should be submitted. The following should be noted:

1. Before a taxpayer can be ed with eFPS, it should have a bank that is ed with internet banking or e-banking. 2. When enrolling for e-banking, be sure first that the depository bank is certified by BIR to use eFPS. (I may not be updated but BDO has no accreditation and only accommodates their clients through a tie-up with China Bank. The process through this arrangement may become tedious since BDO branches are not aware of it.) 3. The enrollment for e-banking and then to eFPS with the bank may require the following: 1. Board resolution approving the enrollment with e-banking and eFPS facilities with the bank. 2. Secretary’s (or President’s or Treasurer’s) certificate – use bank template 3. After enrollment with the bank, enroll with BIR (see process below). Previously enrolment with BIR should come before enrolment with the bank. But due to the long time it takes for banks to process enrollment, the BIR requires a taxpayer to be enrolled first with the bank in order for the taxpayer to avoid facing penalties for not using eFPS after it was activated by BIR. What are the processes and the requirements for application for ICC? There are 6 compliance certificates that need to be secured before the FINAL application for ICC can be made to ARMD. Including the 3 pre-requisites as discussed above, thus, there are 10 sub-processes for ICC application below: No. 1

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Process Application for certificate of good standing with SEC Closure of Open Case per BIR CMS

Remarks Simultaneous with BIR processing Pre-requisite of Annex A; But should be done regularly even without BIR ICC application

Timeline 2 weeks

1 week Registration – 1 month

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eFPS enrolment with BIR

Certificate “Annex A” and “Annex A-1 – Tax Compliance” from RDO Certificate “Annex B” from Regional Legal Division Certificate Annex C” from Regional Collection Division

Simultaneous with Annex A; But can be ignored by Minimum use – 2 those already ed months

3 weeks

Simultaneous with Annex 1 week A Simultaneous with Annex 6 1 week A Automatically given after 3 weeks(same as 7 Certificate “Annex D” from ARMD release of Annex A and Annex A) A-1 Certificate “Annex E” from Audit Information, Tax Simultaneous with Annex 8 3 weeks Exemptions and Incentives Division (AITIED) A Certificate “Annex F” from Miscellaneous Annex A-1 is a pre1 week after Annex 9 Operations Monitoring Division (MOMD) requisite A-1 so 1 month All Annexes are pre2 weeks after 1 Importer Clearance Certificate (ICC) [FINAL] from requisite; needs 10 month of Annexes so ARMD appearance of authorized 1.5 months officer 5

How to secure Certificate of good standing from SEC [Estimated processing time: 2 weeks at least] 1. Preparation of documents (all photocopies): a. latest audited financial statements (AFS) b. latest general information sheet (GIS) (If branch) c. latest certificate of security deposit d. SEC License to transact business (If corporation) e. SEC certificate f. Articles of incorporation g. Photocopy of first page of stock transfer book 2. Submit the above requirements to the monitoring section of SEC and get date monitoring sheet can be released. 3. Get monitoring sheet. 4. Submit the required documents or pay the required fines and penalties per monitoring sheet. 5. Claim SEC Certificate of Good Standing. How to close CMS open cases [Estimated processing time: 1 week or more depending on RDO or if there are open cases] 1. Prepare the requirements 1. Letter request 2. Copy of COR 3. Authorization letter 2. Submit requirements and get CMS print from BIR collection section by presenting letter request. Some RDO may ask you to come back after 3 days. Use your moral suasion to get it within the day or lessen it to 1 or 2 days. 3. IF the printed CMS indicates open case. Draft a letter showing how we have resolved all the open cases. 4. Attach the BIR received letter to the ICC application. How to enrol with eFPS [Estimated processing time: 1 month or more depending on the bank and availability of signatories] 1. Prepare required documents: 1. Letter of Intent to Enroll 2. Signed and notarized Annex A-1 Application Form for Accreditation of Importer 3. Copy of COR 4. Copy of BIR 0605 5. Copy of SEC certificate 6. Printed CMS” 2. Send the required documents to national office who open eFPS online registration 3. Complete enrolment process and print out enrolment page. 4. Submit enrolment page to BIR for activation. 5. Wait for the activation e-mail from BIR. Print and attach to ICC. Print another copy since it is a requirement by the authorized agent bank (AAB). 6. Print eFPS filing with payment for at least two months and attach to FINAL application How to secure certification “Annex A” and “Annex A-1 – Tax Compliance” from RDO [Estimated processing time: 2 to 3 weeks as long as open cases were closed]

1. Prepare the requirements: 1. Copy of GIS; 2. Request letter; 3. Authorization letter; 4. ID of signatory 5. ID of representative 2. Submit documents to BIR RDO 43A 3. Resolve all comments 4. Secure certificate How to secure certification “Annex B” from Regional Legal Division and “Annex C” from Regional Collection Division [Estimated processing time: 1 week, can be done simultaneously with Annex A] 1. Prepare the requirements: Annex B a. 2 copies of filled-out and notarized Application Form for Accreditation of Importer; b. Authorization letter; c. ID of signatory; and d. ID of representative. Annex C a. Photocopy of BIR Form 2303 COR; and b. Authorization letter. 2. Submit documents 3. Resolve all comments 4. Secure certificate How to secure certification “Annex D” from s Receivable Monitoring Department (ARMD)[Estimated processing time: automatically given once Annex A and A-1 were secured so 2 to 3 weeks; simultaneous with Annex A] 1. Prepare the requirements: 1. Photocopy of BIR Form 2303 COR; 2. Authorization letter; 3. ID of signatory; and 4. ID of representative. 2. Submit documents 3. Resolve all comments 4. Secure certificate How to secure certificate “Annex E” from Audit Information, Tax Exemptions and Incentives Division (AITIED) [Estimated processing time: 3 weeks simultaneous with Annex A] 1. Prepare the requirements: 1. Photocopy of BIR Form 2303 COR; 2. SEC Certificate; 3. Letter request; 4. Authorization letter; 5. ID of signatory; 6. ID of representative; and 7. Copy of submitted summary list of sales and purchases and/or proof of submission of VAT Relief in the previous 1-3 years. 2. Submit documents 3. Resolve all comments 4. Secure certificate

How to secure certificate “Annex F” from Miscellaneous Operations Monitoring Division [Estimated processing time: 1 week after Annex A-1] 1. Prepare the requirements: 1. Photocopy of ICC Application Form; 2. Photocopy of Annex A-1 certificate (see above) 2. Submit documents 3. Resolve all comments 4. Secure the certificate 5. How to secure FINAL ICC from BIR-ARMD [Estimated processing time: 2 weeks after submission of all requirements] 1. Prepare the required documents: 1. CTC of latest GIS (get this earlier) 2. latest FS stamped received by SEC and BIR 3. latest income tax return (ITR) submitted to BIR 4. copy of lease contract (notarized) 5. occupancy permit 6. vicinity map 7. copy of latest electric or water or phone bills 8. photographs of the principal place of business 9. notarized affidavit of undertaking to preserved records for 10 years and to allow access of information by the BIR, BOC and the Department of Finance 10. original copy of profile of the corporation 11. original copy of profile of each of Directors and corporate officers 12. original profile of the employees, representatives or agents dealing with customs 13. original copy of the designation of representative to sign application 14. CTC of Mayor’s permit (get this earlier) 2. Attach output from or documents already prepared in the previous processes 1. Certificate of good standing from SEC; 2. Closed CMS case; 3. eFPS filing and payment for two months 4. Annex A-1 Application form for Accreditation of Importer (see eFPS enrolment) 3. Attach compliance certificate or Annexes 1. “Annex A”” and “”Annex A-1″” of RMO 1-2015 2. “Annex B”” and “”Annex C”” of RMO 1-2015 3. “Annex D”” of RMO 1-2015 4. “Annex E”” of RMO 1-2015 5. “Annex F”” of RMO 1-2015″ 4. Submit the files in [1] to [3] to the BIR National Office – s Receivable Monitoring Division (ARMD) for their review. 5. If the application is okay, ARMD will schedule for appearance. 6. After appearance, ARMD will endorse it for payment. 7. Pay the required fee. 8. Issuance of the BIR-ICC Final thoughts The trick is to lay down all the requirements and to study the processes noting which is a prerequisite of which process. Also, be mindful of requirements that needs days to process. Finally, prepare all requirements for signature and get schedule of meeting with the authorized signatory to sign all the documents at once.