Philippine Energy Policy Wiki

DC2020-02-0005: Duty-Free Importation of RE Machinery Guidelines

Status
operative
Confidence
high
Effective date
2020-02-13

Issued: February 13, 2020 | Secretary: Alfonso G. Cusi | Pages: ~9 pages + Annexes A and B

Prescribes detailed guidelines for obtaining a Certificate of Endorsement (COE) from the DOE for duty-free importation of RE machinery, equipment, materials, and spare parts; and for COE applications covering temporary exportation, sale, transfer, or other disposition of originally-imported capital equipment.

Legal basis: RA 9513 §15(b) (duty-free for RE Developers within first 10 years of COR) and §21(a) (duty-free for RE equipment manufacturers).

Sections

§1 — Scope: COE application processing for duty-free importation and for sale/transfer/exportation of equipment covered by prior COEs.

§2 — Definitions (12 terms): Applicant; Certificate of Endorsement; Emergency Importation; Exportation; Importation; Machinery/Equipment/Materials/Spare Parts; RE Developer/Operator; RE Operation; RE Operating Contract; RE Resources; RE Service Contract; Shipping Documents; Technical Obsolescence.

§3 — Conditions for Duty-Free Importation:

  • Track A (RE Developers, §15(b) RA 9513): Within first 10 years of COR; not manufactured domestically in reasonable quantity/quality at competitive prices; exclusively for RE facility use; per approved work/financial program; shipping docs in developer’s name
  • Track B (RE Equipment Manufacturers, §21(a) RA 9513): For manufacture/fabrication of RE equipment; exclusively used in manufacture; not manufactured domestically; prior DOE approval required

§4 — COE Issuance Procedure:

  • 4 original notarized application sets (Annex A); file 30 days before importation; file at RMD
  • Processing chain: RMD(1d) → REMB-OD(1d) → Division(completeness 1d / technical eval 3wd) → Legal Services(3wd) → Usec/Asec(5wd) → REMB Director(2wd) → RMD dry seal(2wd)
  • Capital/heavy equipment: Secretary approval (not Usec)
  • Disapproval: applicant has 15 calendar days to file reconsideration (treated as new application)
  • Sale/disposition: use Annex B; route through Renewable Energy Resources Compliance Division

§5 — Emergency Importation: Force majeure rehabilitation or imminent danger replacement; BOC bond required; proof to DOE within 15 days of posting bond

§6 — Post-Importation Requirements: Official documents within 30 days of BOC release; location/use notification within 15 days of installation

§7 — Sale or Disposition of Capital Equipment: Within 10 years: prior DOE endorsement required; 4 conditions: (1) to RE Developer = no tax; (2) to non-RE = net book value duties; (3) exportation = no tax; (4) technical obsolescence = no tax. After 10 years: no taxes/duties in any case.

§8 — Exportation: COE required for temporary exportation for repair/maintenance. Unauthorized export = 2× the duties originally waived.

§9 — Inspection and Reporting: DOE right of entry; applicant semi-annual database reports; RMD monthly list of approved COEs to DOF Mabuhay Lane.

§10 — Post-Audit: Annual post-audit by Financial Services Compliance Division + REMB + BOI reps; 15-day prior notice.

§11 — Penalties: RA 9513 §36; falsification and non-compliance; aiding/abetting.

Annexes A and B: Standard application forms for (A) duty-free importation and (B) sale/disposition of capital equipment.

Significance

Provides the first fully detailed procedural framework for the duty-free import incentive (RA 9513 §13(B)), replacing the more general 2009 IRR provisions. The 30-day advance filing requirement is operationally important for developers planning equipment shipments. The sale/disposition rules (§7) and the 2× penalty for unauthorized export (§8) protect the integrity of the incentive regime.

DC2021-12-0042 later restructured the COE concept further — limiting duty-free COEs to per-importation basis and eliminating the COE requirement for most other incentives.

Full text: Cleaned copy