The Supreme Court affirmed that the Customs Modernization and Tariff Act (CMTA) allows importers and exporters, or their appointed agents, to manage goods declarations independently, modifying the exclusive role previously held by licensed customs brokers. This decision clarifies the evolving landscape of customs procedures, aligning Philippine practices with international standards by reducing reliance on mandatory customs broker involvement.

Navigating the Shifting Sands of Customs Law: Brokers vs. Declarant Rights

At the heart of this case lies a pivotal question: Who is authorized to handle import and export declarations in the Philippines? The Chamber of Customs Brokers, Inc. (CCBI) sought a declaratory relief, aiming to preserve the exclusivity of licensed customs brokers in signing import and export entries, as initially stipulated in Republic Act No. (RA) 9280, also known as the “Customs Brokers Act of 2004”. This act aimed to professionalize the customs broker profession, granting them the sole authority to sign import and export entry declarations. However, the enactment of RA 10863, or the “Customs Modernization and Tariff Act” (CMTA), introduced a significant shift by allowing consignees or their authorized agents to lodge goods declarations, challenging the brokers’ exclusive domain. The core legal issue revolves around whether the CMTA effectively amended or repealed the provisions of the Customs Brokers Act, particularly concerning who can sign import and export declarations.

The petitioner, CCBI, contended that RA 10863 did not repeal RA 9280, asserting the absence of irreconcilable inconsistencies between the two laws. They argued that allowing non-licensed individuals to perform acts traditionally reserved for licensed customs brokers created unfair advantages and inequality. The Commissioner of Customs, however, argued that RA 10863 modified RA 9280, empowering importers, exporters, and their agents to independently lodge goods declarations. Furthermore, they highlighted the repealing clause within RA 10863, which nullifies any prior inconsistent laws. It was pointed out that RA 9853 had already amended Section 27 of RA 9280, granting exporters the option to sign export declarations themselves or delegate the process to a customs broker or authorized representative.

The Regional Trial Court (RTC) dismissed the petition, stating that RA 10863 authorized importers, exporters, and their agents to lodge goods declarations without customs broker participation, thereby modifying RA 9280. The Court of Appeals (CA) affirmed this decision, emphasizing that RA 9853 had already limited the customs broker’s role by allowing exporters to sign export declarations themselves. The CA noted that RA 10863 further limited the functions of a customs broker. Additionally, the CA pointed out that the repealing clause in RA 10863 indicated a legislative intent to repeal prior inconsistent laws. Thus, the CA determined that an irreconcilable inconsistency existed between RA 9280 and RA 10863, leading to an implied repeal of the former by the latter.

The Supreme Court, in denying the petition, focused on whether the CA correctly affirmed the dismissal of the petition for declaratory relief. The court addressed the timeliness of the filing, noting that the petition was filed out of time and therefore dismissible on procedural grounds alone. However, even substantively, the Court found no merit in the petition. The Supreme Court emphasized that RA 9280 had already been amended by RA 9853, which explicitly allowed exporters to sign export declarations themselves or delegate the signing to their designated customs broker or authorized representative. This prior amendment significantly altered the landscape before RA 10863 was even enacted. The Supreme Court also held that, assuming RA 9853 was not enacted, RA 10863 impliedly repealed Section 27 of RA 9280.

The Court also discussed the concept of implied repeal.

There are two categories of repeal by implication. The first is where provisions in the two acts on the same subject matter are in an irreconcilable conflict. The later act to the extent of the conflict constitutes an implied repeal of the earlier one. The second is if the later act covers the whole subject of the earlier one and is clearly intended as a substitute, it will operate to repeal the earlier law.

The Supreme Court underscored that Section 27 of RA 9280 provided that import and export declarations should be signed only by a customs broker. Conversely, Section 106 (d) of RA 10863 allowed the declarant to sign the goods declaration or delegate such act to their agent or attorney-in-fact. Therefore, the Court concluded that Section 106 (d) of RA 10863 constituted an implied repeal of Section 27 of RA 9280, as amended.

Regarding the petitioner’s claim that Section 106 (d) of RA 10863 violated the equal protection clause, the Supreme Court ruled that the petitioner failed to substantiate such a claim. The equal protection clause ensures that no person or class of persons is deprived of the same protection of laws enjoyed by others in similar circumstances. The Court applied the rational basis test, determining whether there was a legitimate government interest and a reasonable connection between that interest and the means employed to achieve it. It noted that RA 10863 was enacted in response to the country’s obligations to the Revised Kyoto Convention (RKC), aimed at balancing customs control, revenue collection, and trade facilitation. The Court held that the introduction of provisions allowing declarants or their agents to sign goods declarations was reasonably connected to this legitimate government interest.

The Court in Zomer Development Company Inc. v. Special Twentieth Division of the Court of Appeals, Cebu City (Zomer), clarified that the Equal Protection Clause was not intended to prohibit the legislature from enacting statutes that either tend to create specific classes of persons or objects, or tend to affect only these specific classes of persons or objects. It does not demand absolute equality; rather, it merely requires that all persons shall be treated alike, under like circumstances and conditions both as to privileges conferred and liabilities enforced.

Ultimately, the Supreme Court found no concrete evidence or convincing arguments presented by the petitioner to warrant a declaration of unconstitutionality of RA 10863. Therefore, the Court affirmed the constitutionality of RA 10863, solidifying the rights of importers, exporters, and their agents to independently handle goods declarations, thus reshaping the customs landscape in the Philippines.

FAQs

What was the key issue in this case?	The central issue was whether the Customs Modernization and Tariff Act (RA 10863) effectively amended or repealed provisions of the Customs Brokers Act (RA 9280) regarding who is authorized to sign import and export declarations.
What did the Customs Brokers Act (RA 9280) initially state?	RA 9280 initially granted licensed customs brokers the exclusive right to sign import and export entry declarations, aiming to professionalize the customs broker profession.
How did the Customs Modernization and Tariff Act (RA 10863) change this?	RA 10863 allowed consignees or their authorized agents to lodge goods declarations, challenging the exclusive domain previously held by licensed customs brokers.
What is the significance of RA 9853 in this case?	RA 9853, enacted before RA 10863, amended Section 27 of RA 9280, granting exporters the option to sign export declarations themselves or delegate the process.
What does the concept of implied repeal mean in this context?	Implied repeal means that a later law, even without explicitly stating so, can nullify an earlier law if their provisions are irreconcilable or if the later law covers the entire subject matter of the earlier one.
What is the equal protection clause, and how does it relate to this case?	The equal protection clause ensures that no person or class of persons is deprived of the same protection of laws enjoyed by others in similar circumstances. The petitioner argued that RA 10863 violated this clause, but the court found no substantiation for this claim.
What was the Supreme Court’s final ruling?	The Supreme Court denied the petition, affirming that RA 10863 effectively modified RA 9280, allowing importers, exporters, and their authorized agents to independently handle goods declarations.
What are the practical implications of this ruling?	The ruling empowers importers and exporters, giving them greater flexibility in managing their customs processes and potentially reducing reliance on mandatory customs broker involvement.

In conclusion, the Supreme Court’s decision in this case marks a significant shift in the landscape of Philippine customs law. By affirming the rights of importers, exporters, and their authorized agents to independently handle goods declarations, the court has ushered in a new era of flexibility and efficiency in customs procedures. This decision not only aligns Philippine practices with international standards but also empowers businesses to take greater control over their import and export operations.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: CHAMBER OF CUSTOMS BROKERS, INC. (CCBI) vs. COMMISSIONER OF CUSTOMS, G.R. No. 256907, February 20, 2023