DETERMINATION OF DUTIABLE

FREIGHT AND DUTIABLE INSURANCE

(CMO 22-2007)
BY: DERICK D. DE GUZMAN, LCB
 ELEMENTS OF DUTIABLE VALUE

TOTAL CUSTOMS VALUE FOB value by sea/

FCA value by air
(Incoterms 2020)

Plus: DUTIABLE FREIGHT By sea/air

(CMO 22-2007)

Plus: DUTIABLE INSURANCE (CMO 22-2007)

Plus: DUTIABLE OTHER CHARGES Mandatory

Additions
(CMO 16-2010)
There is no such thing as failure, only delayed
success 2
 A. DUTIABLE FREIGHT (SEA)

• Refers to the charges paid for the transport of the cargo from
port of origin to port of destination

a. Shall be the freight charges indicated in the B/L

b. If the freight charges appears in both the commercial invoice

and B/L or AWB, then the dutiable freight is whichever is higher
between the freight per invoice and the freight charges per B/L
or AWB
Dut. FRT = FRT per CI vs. FRT per B/L, whichever is higher

There is no such thing as failure, only delayed

success 3
 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
T. CFR $27,750.00
FRT/Inv $2,200.00
FRT/BL $2,250.00
Dut. INS $500.00
E/R P43.150/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 4
 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 2

GIVEN:
T. CPT $15,500.00
FRT/Inv $1,550.00
FRT/BL $1,500.00
Dut. INS $310.00
E/R P43.250/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 5
 A. DUTIABLE FREIGHT (SEA)

c. If no freight charge is indicated in the bill of lading

and/or invoice, then the declared freight charge on
the IEIRD/SAD may be considered, provided that said
amount is not lower than 70% of the Conference Rate,
otherwise a Certification from the carrier or Official
Receipt as to the actual freight charges paid must be
presented to the BOC

Dut. FRT = FRT/SAD vs 70% of GCR, whichever is higher

There is no such thing as failure, only delayed

success 6
 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
T. FOB $8,500.00
FRT/SAD $800.00
FRT/GCR $1,150.00
Dut. INS $170.00
E/R P43.045/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 7
 A. DUTIABLE FREIGHT (SEA)

d. In case of bulk shipments, the certified copy of Charter party

document of Freight Contract, and Stowage Plan shall be
presented to show the actual freight charges, all of which shall
be attached to the working copy of the entry.
Dut. FRT = FRT per Charter Party Contract

e. For bulk/general cargo shipments made by the National Food

Authority (NFA), the actual freight charge may be accepted
provided that it is not lower than 10% of the CFR value of the
commodity.
Dut. FRT = Actual FRT vs 10% CFR, whichever is higher

There is no such thing as failure, only delayed

success 8
 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
Consignee NFA
Shipment Corn in bulk
T. FOB $25,000.00
FRT/BL $2,500.00
Dut. INS $1,000.00
E/R P43.185/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 9
 A. DUTIABLE FREIGHT (SEA)

f. In case of refrigerated shipments, a certification from shipping lines as

to the freight paid must be presented for Customs verification.
Dut. FRT = FRT/BL (w/ Certification from S.L.)

In the absence of a shipping lines certification, the following freight

charges may be used as reference:

*From China: 20’ 40’

Guangzhou $1,300.00 $1,700.00
Xiamen $1,500.00 $1,800.00
Shanghai $1,800.00 $3,200.00
Dalian $1,350.00 $1,680.00

There is no such thing as failure, only delayed

success 10
 A. DUTIABLE FREIGHT (SEA)

*From Hong Kong:

$1,600.00 per 40’ reefer van
$800.00 per 20’ reefer van

*From Singapore:
$970.00 per 20’ reefer van
$1,990.00 per 40’ reefer van

* From Los Angeles, USA

$3,050.00 per 20’ reefer van
$6,100.00 per 40’ reefer van

Dut. FRT = FRT/BL vs Reefer Rates, whichever is higher (if no cert. from SL)

There is no such thing as failure, only delayed

success 11
 A. DUTIABLE FREIGHT (AIR)

a. Shall be the freight charges indicated in the Air Waybill

b. If no freight charge is indicated in the air waybill and/or

invoice, then the declared freight charge on the IEIRD/SAD
may be considered, provided that said amount is not lower
than 70% of the Conference Rate, otherwise a Certification
from the carrier or Official Receipt as to the actual freight
charges paid must be presented to the BOC
Dut. FRT = FRT/SAD vs 70% of IATA, whichever is higher

There is no such thing as failure, only delayed

success 12
 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 1

GIVEN:
Shipment 2x20’ STC: Frozen poultry meat
Origin Hong Kong
T. FOB $10,500.00
T. O/FRT $1,500.00 (w/o cert. from S.L.)
Dut. INS $420.00
E/R P43.065/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 13
 A. DUTIABLE FREIGHT (SEA)

ILLUSTRATION 2

GIVEN:
Shipment 3x40’ STC: Frozen salmon
Origin Xiamen, China
T. FOB $22,500.00
FRT/BL $4,500.00 (w/ cert. from S.L.)
Dut. INS $900.00
E/R P43.350/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 14
 B. DUTIABLE INSURANCE

• Refers to the cost of insurance taken to

cover against risk for damage/loss while
transporting goods from origin to destination

a. If the terms of sale are CIF/CIP, the amount

of the actual insurance premium shall be used
in the assessment, PROVIDED THAT, it is
indicated as a SEPARATE VALUE

There is no such thing as failure, only delayed

success 15
 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Gen. cargo
T. FOB $12,500.00
FRT/Inv $ 1,200.00
FRT/BL $ 1,250.00
INS/Inv $ 200.00
T. CIF $13,900.00
E/R P43.115/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 16
 B. DUTIABLE INSURANCE

b. If such amount is lower than 2% of the FOB value for

general cargo and 4% of the FOB value for
dangerous/inflammable goods, the same shall be
subject to further verification by the BOC
1. Gen. Cargo 2. Dangerous Cargo
𝐶𝐼𝐹−𝐹𝑅𝑇 𝐶𝐼𝐹−𝐹𝑅𝑇
a. 𝐹𝑂𝐵 = 1.02
a. 𝐹𝑂𝐵 = 1.04
b. INS = 0.02 x FOB b. INS = 0.04 x FOB

There is no such thing as failure, only delayed

success 17
 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Chemicals
T. CIF $18,244.00
FRT/BL $ 1,300.00
E/R P43.250/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 18
 B. DUTIABLE INSURANCE

c. If a shipment is covered by a local or domestic

insurance, the amount of insurance premium actually
paid may be accepted for assessment purposes (if
equivalent or higher than 2% or 4% for general and
dangerous cargo, respectively)

*If with Cert./OR

𝑳𝒐𝒄𝒂𝒍 𝑷𝒓𝒆𝒎
Dut. INS = 𝑬/𝑹

There is no such thing as failure, only delayed

success 19
 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Gen. cargo
T. FOB $9,750.00
T. O/FRT $ 750.00
Loc. INS P6,491.25 (w/ Cert./O.R.)
E/R P43.275/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 20
 B. DUTIABLE INSURANCE

d. If the local insurance premium is lower than 2% of the FOB

value for general cargo to 4% of the FOB value for
dangerous/inflammable goods, then a certification from the
insurance company indicating actual premium paid shall be
presented to the BOC together with the original official receipt.

*If without Cert/O.R.

a. INS1 = Loc. Prem
b. Ins2 = 2% or 4% FOB

Dut. INS = whichever is higher from a or b

There is no such thing as failure, only delayed

success 21
 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment 2 units - automobiles
T. FOB $25,000.00
O/FRT $2,000.00
Loc. INS P34,760.00 (w/o Cert./O.R.)
E/R P43.450/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 22
 B. DUTIABLE INSURANCE

e. Importation not covered by any local insurance, the amount

of insurance premium declared in the Entry may be accepted,
provided that if such amount is lower than 2% and 4% of the FOB
value for general and dangerous cargoes respectively, the same
shall be subject to verification by the BOC.

For General Cargoes: For Dangerous Cargoes:

Dut. INS = 2% x FOB Dut. INS = 4% x FOB

There is no such thing as failure, only delayed

success 23
 B. DUTIABLE INSURANCE

ILLUSTRATION 1

GIVEN:
Shipment Gen. cargo
T. CFR $13,500.00
FRT/Inv $1,300.00
FRT/BL $1,350.00
“No local insurance”
E/R P43.450/$1.00

Find Total Dutiable Value

There is no such thing as failure, only delayed

success 24
 B. DUTIABLE INSURANCE

f. For direct importation by the government, the original copy of

the Marine Open policy issued by the GSIS together with true
copy shall be presented to the BOC certified by the latter. The
Bureau shall apply the actual GSIS insurance premium rate.

𝑰𝑵𝑺 𝒑𝒓𝒆𝒎𝒊𝒖𝒎/𝑮𝑺𝑰𝑺
Dut. INS = 𝑬/𝑹

If insured by a domestic surety company other than the GSIS,

apply d. and if not covered by a local insurance , apply e.

There is no such thing as failure, only delayed

success 25