The Department of Finance (DOF) and the Department of Trade and Industry (DTI) issued Joint Administrative Circular No. 2020-02, providing for guidelines on the operations and incentives of covered enterprises engaged in the manufacture, importation, and distribution of certain products, and for other purposes, pursuant to Republic Act No. 11469, otherwise known as the “Bayanihan to Heal as One Act“.
The incentives cover only certain products (see list of covered products) and benefit only covered enterprises (listed below). The importations must be reasonably needed and will be used exclusively by the covered enterprises in the manufacture of the covered products. Moreover, the importations must be ordered, loaded or are in transit during the effectivity of the applicable regulations (added: ECQ effectively extended to 30 April 2020, per Memorandum dated 7 April 2020; further extended to May 15 for high-risk areas). Joint Administrative Circular No. 2020-02 is already in effect and shall remain in effect only during the effectivity of Republic Act No. 11469.
The covered enterprises must secure an Accreditation Certification and an authority to import for covered products from the DTI, through the Board of Investments (BOI).
The enterprises comprising the supply chain to ensure availability of the covered products are as follows:
- 1. Manufacturer or producer
- 2. Suppliers of raw materials
- 3. Manufacturer of packaging materials
- 4. Suppliers of raw materials for the packaging
Exemption from Import Duties, Taxes, and Fees
Regardless of the country of origin, importation by the covered enterprises of the raw materials, packaging and its raw materials, or any articles needed in the supply chain of the covered products, such as capital equipment, spare parts and accessories, shall be exempt from import duties, taxes and fees such as import processing fees and other fees imposed by the Bureau of Customs (BOC), Food and Drug Administration (FDA) and other relevant agencies.
Suspension of Export Requirement
The export requirement imposed under the laws administered by relevant Investment Promotion Agencies (IPA) is hereby suspended. The export enterprises that manufacture the covered products shall supply at least eighty percent (80%) of their daily production to the procuring entity determined under RA No. 11469, government institutions, hospitals, and private establishments in the country for local or domestic use.
The local sales of such export enterprises shall be deemed and treated as “export sales” in compliance with their export requirement. As such, the corresponding treatment, exemption on duties, taxes and fees, and other incentives warranted under the existing laws governing these export enterprises shall continue to apply. Further, if such export enterprises are located in special economic zones with status of separate customs territory under relevant laws, such local sales shall likewise be exempt.
Availability of Covered Products
To ensure the availability and adequate supply of the covered products, the covered enterprises shall:
- 1. continue their operations in full capacity;
- 2. partner with government agencies for the manufacture of covered products;
- 3. prioritize and accept procurement contracts under fair and reasonable terms for the supply and delivery of the covered products; and
- 4. comply with all relevant health and safety protocols issued by relevant agencies.
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- Guidelines on the Administration of COVID-19 Vaccines in the Workplaces (Labor Advisory No. 3) - March 12, 2021