Supreme Court E-Library
Information At Your Fingertips

Whereas, Executive Order No. 285 dated 23 February 2004 directs the Secretary of the Department of Trade and Industry to rationalize and streamline the operations of the GTEB and implement a winding up plan by 2005, and deactivates the Garments and Textile Export Board (GTEB) by 2005.

Whereas, in view of the deactivation of the GTEB by 2005, there is a need to devolve the functions of licensing raw material importations, Bonded Manufacturing Warehouses (BMW) and Common Bonded Manufacturing Warehouses (CBMW), accreditation of garment exporters as members of CBMW and accreditation/registration of subcontractors to other appropriate agency of the Department.

Whereas, the integration of the garments and textile sector into the mainstream machinery of government for import facilitation will need familiarization of stakeholders, and the DTI shall, for the meantime, maintain the import-related licensing functions of GTEB until subsequently integrated.

NOW, THEREFORE, in the context of the following premises and in order to ensure effective implementation and smooth transition or devolution of functions, the following are hereby prescribed:

SECTION 1. The import-related functions of GTEB is hereby devolved to a One- Stop-Shop for Garments lodged under the Bureau of Export Trade Promotion.

SECTION 2. There is hereby created a Garments and Textile Import Services (GTIS) Division under the One-Stop-Shop for Garments lodged with the BETP who shall perform and exercise the functions and authority relative to the issuance of license to import raw materials, license to operate a Bonded Manufacturing Warehouse (BMW)/ Common Bonded Manufacturing Warehouse (CBMW), accreditation of garment exporters as member of CBMW and accreditation/registration of subcontractors.

SECTION 3. GTIS Special Committee - There is hereby created a GTIS Special Committee to be composed of the Department Secretary as Chair, and the Supervising Senior Undersecretary for International Trade and the Supervising Undersecretary for Industry and Investments, as members. The GTIS Special Committee shall act as the policy-making body of the Department on all import related matters relative to exports of garments and textile.

SECTION 4. GTIS Inter-Agency Executive Committee. In addition, there is hereby created a GTIS Inter-Agency Executive Committee to be composed of three (3) Department Directors: the Executive Director of the Board of Investments Industry Development Group as Chair, the Assistant Director of the Bureau of Export Trade Promotion - Product Group and the Deputy Executive Director of the Export Development Council, as members. The GTIS Inter-Agency Executive Committee shall oversee the operations of the GTIS division and ensure that all actions of the GTIS division are in conformity with the rules and regulations on import-related services.

SECTION 5. Supervision - The GTIS Inter-Agency Executive Committee shall exercise operational supervision over the GTIS Division. Its responsibility and authority shall emanate from the GTIS Special Committee. On the other hand, the Bureau of Export Trade Promotion shall be limited to administrative supervision.

SECTION 6. Rules and Regulations on Garments and Textile Import Services (R and R on GTIS). The operations of the GTIS Division shall be governed by the R and R on GTIS. All actions and decisions of the GTIS Inter-Agency Executive Committee shall strictly adhere to the R and R on GTIS. The GTIS Special Committee shall have the authority to review and revise said R and R.

SECTION 7. Transition - A Transition Team from the GTEB shall assist and train the GTIS Division personnel during the first quarter of 2006 as part of the carry-over function of GTEB.

SECTION 8. Effectivity and Repealing Clause - This Order shall be published in two (2) newspapers of general circulation in the Philippines and shall take effect immediately after its publication. All other Orders, Circulars, Memoranda, and issuances inconsistent herewith are hereby revoked, cancelled or modified accordingly, otherwise they shall have supplementary effect.

Adopted: 27 Dec. 2005

(SGD.) PETER B. FAVILA
Secretary

Garments and Textile Import Services
Rules and Regulations

Pursuant to Sections 1 and 2 of Executive Order No. 285, in conjunction with the pertinent provisions of Executive Order No. 292 (Administrative Code) and Executive Order No. 133, and for efficient administration and proper execution of the laws, the following are the Garments and Textile Import Services (GTIS) Rules and Regulations:

Rule 1
Title, Construction and Definition

SECTION 1. Title - These shall be known as the Garments and Textile Import Services Rules and Regulations, implementing the provisions of Department Administrative Order No. 07, devolving the import-related functions of Garments and Textiles Export Board (GTEB) to a One-Stop Shop for Garments Lodged Under the Bureau of Export Trade Promotion.

SECTION 2. Construction - These rules shall be liberally construed in order to promote its objectives, facilitate export, and assist exporters in the manufacture and export of garments from the Philippines.

SECTION 3. Definition of Terms - For purposes of these Rules, the following shall be defined:

a. Garments and Textile Import Services (GTIS) Division hereinafter known as the GTISD - a division created under the One-Stop-Shop for Garments of the Bureau of Export Trade Promotion who shall perform and exercise the functions and authority of the GTEB relative to the issuance of license to import raw materials, license to operate Bonded Manufacturing Warehouse (BMW)/Common Bonded Manufacturing Warehouse (CBMW), accreditation of garment exporters as member of CBMW and accreditation/ registration of subcontractors.

b. GTIS Special Committee hereinafter known as GTIS-SC - A special committee created under Department Administrative Order No. 07 composed of the Department Secretary, as Chair and the Supervising Undersecretary for International Trade and the Supervising Undersecretary for Industry and Investments Group, as members. The GTIS- SC shall act as the policy-making body of the Department on all import-related matters.

c. GTIS Inter-Agency Executive Committee hereinafter known as the GTIS IA Ex- com- A committee composed of the Executive Director of the Infrastructure and other Industrial Goods Department, as Chairman, Assistant Director of the Bureau of Export Trade Promotion-Product Group and Deputy Executive Director of the Export Trade Promotion-Product Group and Deputy Executive Director of the Export Development Council, as members. The GTIS IA Excom shall oversee the operation of the GTISD and ensure that all actions of the GTISD are in conformity with the rules and regulations on import-related services.

d. Accreditation - Procedure set by the GTIS-SC whereby an exporter becomes a member of a CBMW or a subcontractor becomes eligible to undertake a subcontracting job for a garment manufacturer.

e. Bonded Manufacturing Warehouse - Includes the premises, rooms, compartments and other areas necessary for storing, processing and manufacturing of imported raw materials, accessories, supplies, under bond and by products or wastages incident thereto.

f. Bonded Manufacturing Warehouse (BMW) License - Authority granted to a person, firm or corporation to operate a Bonded Manufacturing Warehouse.

g. Common Bonded Manufacturing Warehouse (CBMW) License - Authority granted to a BMW operator person, firm or corporation to service the importation requirements of garment exporters which are not BMW operators.

h. Consignment Basis - Method of importation and/or local procurement whereby a foreign principal buyer consigns raw materials, accessories and supplies, free of charge, to local garment manufacturer-exporter who shall assume responsibility for its manufacture into finished garments to be exported to specified buyers abroad.

i. Days - Calendar days.

j. Direct Purchase - Method of importation and/or local procurement whereby a manufacturer-exporter pays for the new raw materials, accessories, and supplies. The title to the imported and/or locally procured materials is vested in the manufacturer-exporter.

k. Export Performance - Actual exports made in a year/period supported by proofs of shipment such as bill of lading or airway bills.

l. Import License - Authority issued to manufacturer-exporter to import tax and duty free regulated raw materials, accessories and supplies for the manufacture and export of textile and/or textile products, without need of further endorsement from other government agencies.

m. Import License Value - Value of raw materials that may be imported by a manufacturer-exporter against a particular import license under the bulk importation scheme.

n. Job-Order - The method of importation where raw materials, accessories, and supplies may be imported based on specific export order(s).

o. Liberalized System of Importation (Bulk Importation) - Method of importation where raw materials, accessories, and supplies may be imported in bulk to enable the manufacture-exporter to stock desired materials that may be used in the manufacture and export of textiles and/or textiles products.

p. Local Value Added (LVA) - F.O.B value less cost of imported raw materials, accessories, and supplies.

q. Garment Manufacturer-Exporter - Person, firm or corporation duly registered with the GTIS-SC which manufactures textiles and/or textile products for export.

r. Operator - Manufacturer-exporter who operates a Bonded Manufacturing Warehouse or Common Bonded Manufacturing Warehouse.

s. R.A. 3137 (Bulk Importation) Act authorizing a manufacturer-exporter licensed by the Embroidery and Apparel Board to receive consigned raw materials from foreign principal with the condition that the same shall be manufactured into finished textiles and/or textile products and exported to the buyer designated by the principal abroad.

t. Raw materials, Accessories, and Supplies - Textiles and related materials, such as, but not limited to, fabrics (in precut or continuous forms), yarns, leather materials, trimmings, accessories and supplies necessary for the manufacture and export of garments. These do not include remnants.

u. Subcontractor - Person, firm or corporation who performs any production process for a manufacturer or exporter.

SECTION 4. Coverage - These rules and regulations shall govern:

a. Issuance of license to garment exporters to import tax and duty free raw materials under a bonded warehousing system.

b. Issuance of license to garment exporters to operate a Bonded Manufacturing Ware- house (BMW).

c. Issuance of license to garment exporters to operate a Common Bonded Manufacturing Warehouse (CBMW).

d. Accreditation of garment exporters applying as members of a CBMW for tax and duty free importation of materials.

e. Accreditation and registration of subcontractor for purposes of moving bonded raw materials from BMWs/CBMWs for a specific manufacturing process.

Rule II
Bonded Manufacturing Warehouse (BMW)

SECTION 1. Requirements - The following are the requirements for application for operation of a bonded manufacturing warehouse (BMW):

a. Track record of annual FOB US$1.0 M Export Sales (actual or projected).

b. Capacity to produce annual export sales of US$1.0 M either in-house or through subcontractors

c. Confirmation of orders by principals/buyers.

d. Submission of plan (blueprint) of the proposed BMW showing and describing the size, layout and location of the proposed premises.

e. Must have no previous record of violation of the Tariff and Customs Code nor any pending case for violation of the GTIS-SC, or of its precursor agency, and Bureau of Customs (BOC) Rules and Regulations.

SECTION 2. Conditions - The following are the conditions for the operations of a BMW:

a. All garment and apparel articles manufactured in whole or in part out of bonded raw materials and intended for exportation may be manufactured in whole or in part in a bonded manufacturing warehouse; provided that the manufacturer-exporter of such articles has secured a permit from the GTIS-SC to operate such warehouse and has posted a bond from a reputable bonding company acceptable to the Bureau of Customs guaranteeing faithful compliance with all laws, rules and regulations applicable thereto.

b. Extension and expansion of a BMW shall be licensed only if the established capacity of the present facility has been utilized.

c. A BMW license shall be valid for a period of two (2) years and shall be renewable every two(2) years.

d. A BMW shall pay the following fees:

1. Filing fee of P500.00
2. P5,000.00 fee upon issuance of the BMW license or any extension of such warehouse.

SECTION 3. Renewal - A BMW license may be renewed upon compliance with the requirements and conditions provided under the Sections 1 and 2 of this rules and regulations and upon payment of the following fees:

1. Renewal fee of P5,000.00 to be paid upon approval of its application for renewal of BMW license.

2. Extension/Renewal fee of P5,000.00 for every BMW extension.

The GTIS-SC shall have the prerogative to waive compliance with any of the fore- going conditions in meritorious cases. In the event that the BMW operator fails to comply with the requirements for renewal of the BMW license due to meritorious reasons, it may be given a period of two (2) years within which to comply with the said requirements. During this period the GTIS-SC may allow the continuous operation of the BMW upon payment by its operator of a forbearance fee of Ten Thousand Pesos (P10,000.00).

Rule III
Common Bonded Manufacturing Warehouse (CBMW)

SECTION 1. Requirements - The following are the requirements for the issuance of CBMW license;

a. The applicant manufacturer-exporter shall submit a plan (blueprint) of the proposed CBMW showing and describing the size, layout and location of the proposed premises.

b. Applicant manufacturer-exporter and its principal officers and/or directors must have no previous record of violation of the Tariff and Customs Code nor any pending case for violation of GTIS-SC, or of its precursor agency, and BOC Rules and Regulations. The GTIS-SC may order an audit of the manufacturer-exporter and its stockholders should it deem necessary.

c. Applicant manufacturer-exporter shall undertake that the construction of the CBMW is in conformity with the specifications as required by the GTIS-SC and BOC.

d. Applicant manufacturer-exporter shall be required to submit a viability study containing information on the following aspects of its operation;

1. Organizational data on management structure.
2. Data on personnel, operational and control procedures, plant facilities/ warehouses specifications, machineries, services offered to members and service rates.
3. Financial Statements and ratio including assumptions used as bases of projections.
4. Marketing Data on potential clients or accredited member.

SECTION 2. A CBMW shall pay the following fees:

a. Filing fee - P1,000

b. P50,000 fee upon issuance of CBMW license.

c. P2,500 annual fee.

SECTION 3. Conditions - CBMW may operate under the following conditions:

a. The CBMW operator shall pay a CBMW license fee of Fifty Thousand Pesos (P50,000.00) upon the issuance of a license to operate a CBMW or any extension thereof.

b. The CBMW operator shall apply with GTIS-SC for the accreditation of its proposed members.

c. The CBMW operator shall secure an Import License (IL) from GTIS-SC prior to the importations of raw materials for the account of its accredited members.

d. The fabrics imported by the CBMW operator for the account of its accredited members must be cut-to-pattern or panel cut as approved by BOC prior to the release therein to the accredited members.

e. The CBMW operator shall be directly responsible for the liquidation of all raw materials imported through its CBMW.

f. The CBMW facilities shall be used solely to service the importation requirements of its accredited members.

g. The transfer of imported raw materials, accessories, and supplies in the following instances shall require prior approval from BOC

1. Transfer of materials imported by the CBMW operator through its own BMW to any of its accredited members.

2. Transfer from one accredited member to another

h. The CBMW operator shall pay an annual fee of P2,500.00 not later than end of 1st quarter of the year.

i. The CBMW license shall be valid for as long as the CBMW operator complies with the foregoing conditions.

j. A CBMW operator desiring to discontinue the operations of its CBMW shall file written application with the GTIS-SC.

SECTION 4. Accreditation of Members of CBMW - Manufacturer-exporter who are not BMW operators may import raw materials, accessories, and supplies to be manufactured into textiles and/or textile products for export through CBMW. Provided that the garment firms are duly accredited with the GTIS-SC as the manufacturer-exporter and accredited members of the CBMW through which the importation shall be made.

SECTION 5. Conditions for Accreditation - A CBMW Accreditation is subject to the following conditions:

a. Documentary requirements

1. A plan showing and describing the size, layout, and location of the premises of the intended member;

2. Records to update requirements for registration as manufacturer-exporter.

b. Terms and Conditions

1. Applications for the accreditation of member of CBMW shall be filed with the GTIS-SC by the CBMW operator.

2. A manufacturer-exporter shall at any one time be accredited with only one common bonded manufacturing warehouse.

3. The accredited member shall pay an accreditation fee of P500.00

4. The accredited member shall maintain at all times in its place of business and make available for inspection its books and accounts and records of imported materials.

5. The warehouse/place of business of the accredited member shall be made accessible to all authorized GTIS-SC officials or representatives upon presentation of an approved mission order or proper demand for ocular inspection.

6. The accredited member shall secure the materials imported through the CBMW against pilferage and loss thru fires, floods, and other such occurrences.

7. The imported raw materials shall be cut-to-pattern or panel cut (requires BOC approval) in the CBMW prior to release to the accredited member.

8. The GTIS-SC shall conduct periodic inspections of the facilities of the CBMW.

9. The transfer of imported raw materials in the following instances shall require prior approval from the BOC.

a. The transfer of imported raw materials by the CBMW operator through its own BMW to any of its accredited member.

b. Transfer of imported raw materials from one accredited member to an- other.

10. The accredited member shall not issue materials to subcontractors who are not registered with the GTIS-SC.

11. The list of raw materials previously approved by the GTIS-SC may be updated by the CBMW operator should any other raw material not originally on the list be needed.

12. The accreditation of a member of a CBMW which has not applied for nor effected importation within a minimum period of twelve months shall be considered cancelled without prejudice to filing another application for accreditation.

13. A Letter of No Objection from CBMW operator may be required to terminate membership of the CBMW member.

14. The GTIS-SC shall have the prerogative to waive compliance with any of the foregoing conditions in meritorious cases.

15. The GTIS-SC reserves the right to cancel for just cause the accreditation of any member violating any of the provisions of this Rules and Regulations.

Rule IV
Revocation of BMW/CBMW License

SECTION 1. Revocation of BMW/CBMW License - The license to operate a BMW/ CBMW may be revoked on grounds of non-compliance with the requirements and conditions for the establishment and operation of the BMW/CBMW.

SECTION 2. Surrender of BMW/CBMW License - License to operate BMW/CBMW may be surrendered upon application with the GTIS-SC by its operator before the expiration of the existing license.

SECTION 3. Procedures when BMW/CBMW License is Revoked/Surrendered  - The following rules shall be applied in the event the license to operate a BMW/CBMW is revoked by the GTIS-SC or otherwise surrendered by the operator.

1. Importation of raw materials made through a BMW/CBMW by an operator whose license is revoked shall be limited to balances of import licenses issued prior to revocation and shall be effected within the validity period of the corresponding import licenses or within six months from date of revocation, whichever comes later. Provided that the importation shall be subject to the rules and regulations on exportation and liquidation of imported materials. Provided, further, that the exportation period shall not be extendible.

2. An inventory of the materials imported and stored in the BMW/CBMW shall be conducted jointly by representatives from GTIS/SC/BOC Audit Team, after the exportation period of the last importation has expired. Provided that the GTIS-SC may require all bonded goods remaining in the warehouse to be placed under the Customs guard and subject such to all terms and conditions that the GTIS-SC may require.

A motion for reconsideration of the GTIS-SC’s revocation may be filed with the GTIS-SC on or before the expiration of the validity date of the last Import License issued prior to the revocation of the BMW/CBMW license. Subject manufacturer-exporter shall submit within the period prescribed herein proofs of compliance with the requirements/ criteria used as basis for the GTIS-SC decision.

SECTION 4. Audit of BMW/CBMW - The GTIS-SC/BOC Audit Team shall conduct a regular audit of the operations of the BMW/CBMW operators for purposes of monitoring imported materials and determining compliance with this Rules and Regulations.

The GTIS-SC shall refer to the BOC any common/bonded manufacturing ware- house operator who failed to account for all imported materials.

Rule V
Accreditation /Registration of Subcontractors

The manufacturer-exporter can accredit and at the same time register its subcontractor.

SECTION 1. Accreditation - The following are qualified to be accredited with the GTIS-SC as subcontractor.

a. Manufacturer-exporter duly registered with the SEC and/or the DTI and who manufactures and exports textile and textile product.

b. Garment firm duly registered with the SEC and/or the DTI.

SECTION 2. Accreditation Requirements - A certificate of accreditation shall be issued by the GTIS-SC to qualified subcontractors after satisfying the following requirements:

a. Duly accomplished Application Form
b. Copy of the Business Name Registration certificate
c. SEC Registration certificate
d. Articles of Partnership
e. Mayors Permit or Certificate of Registration under R.A. 6810
f. Location Map
g. List of machines
h. Ocular inspection conducted by GTIS-SC or Regional/Provincial DTI Representative on the facilities of the applicant firm.
i. Filing fee of P100.00
j. Acceptance of Terms and Conditions for Accreditation.

The Certificate of Accreditation shall be valid for one (1) year from the date of issue.

SECTION 3. Registration - Only the manufacturer-exporter who shall avail of the services of duly accredited subcontractor can register it with the GTIS-SC.

SECTION 4. Registration Requirements - A certificate of registration shall be issued by the GTIS-SC after satisfying the following requirements:

a. Duly accomplished Application Form
b. Certificate of Accreditation as Subcontractor
c. Annual registration fee of P50.00

The Certificate of registration issued shall be co-terminus with the validity of the subcontractors accreditation.

SECTION 5. Ocular Inspection - Applicant firm shall be subject to ocular inspection.

Rule VI
Import Licensing of Raw Materials

SECTION 1. Raw Materials - Importation of raw materials, except accessories and supplies shall be covered by an Import License issued by the GTIS-SC. Importation of raw materials for sample purposes exceeding P10,000.00 or its equivalent in US dollars shall require prior GTIS-SC approval.

SECTION 2. Qualification - Only the following manufacturer-exporter shall be al- lowed to import, tax and duty free, raw materials, accessories and supplies.

a. Bonded Manufacturing Warehouse/Common Bonded Manufacturing Warehouse operators

b. Accredited members of a Common Bonded Manufacturing Warehouse Operators.

SECTION 3. Importation Schemes - Every manufacturer-exporter, except those operating in the Export Processing Zone, may apply with the GTIS-SC for a license to import raw materials under the following schemes:

A. Job-Order Scheme

Qualified to import under the Job-Order Scheme:

1. New BMW operators and CBMW members
2. BMW operators and CBMW members with less than nine (9) months track record of exportation of imported raw materials

B. Liberalized System of Importation (Bulk Importation)

Qualified to import under the LSI Scheme are BMW operators and CBMW accredited members with at least nine (9) months track record of exportation of imported raw materials.

A firm importing under the Job-Order Scheme which achieves said track record shall automatically be shifted to the LSI Scheme.

C. R.A. 3137 (Bulk Importation)

Qualified are BMW operators licensed by the Garments and Textile Export Board, or by its precursor agency, the Embroidery and Apparel Control and Inspection Board, and those BMW operators that may be qualified and licensed henceforth.

SECTION 4. Requirements - The following documents shall be submitted upon application for an Import License:

A. Job-Order

1. Duly accomplished application form
2. Duplicate original copy of Proforma Invoice
3. Duplicate original copy of Purchase Order
4. Computation of consumption of raw materials
5. Computation of Foreign Exchange Realizable
6. Sketch/sample of the export product to be manufactured

B. Liberalized System of Importation/R.A. 3137 (Bulk Importation)

1. Duly accomplished application form
2. Latest notarized report on inventory and usage of raw materials

SECTION 5. Basis for Approval and Issuance of Import License - The following shall be the bases for the approval and issuance of an import license:

A. Job-Order

1. Existence of confirmed export order

B. Liberalized System of Importation/RA 3137 (Bulk Importation)

The value of an import license to be issued under the bulk importation scheme shall be based on the Import License Value (ILV). The ILV, which shall be derived from the inventory report, shall be computed as follows:

 

ILV = X - {Y + Z)

 

Where X = Value of imported raw materials re-exported during the twelve- month period immediately preceding the date of application.

 

Y = Value of inventory of imported raw materials, accessories and supplies not yet exported.

 

Z = Value of unutilized import licenses

C. RA 3137 (Bulk Importation)

The value of the import license to be issued under the RA 3137 scheme shall also be based on the Import License Value (ILV) computed as follows:

 

ILV = 1.5 X - (Y + Z)

 

Where X = Value of imported raw materials re-exported during the twelve- month period immediately preceding the date of application.

 

Y = Value of inventory of imported raw materials, accessories and supplies not yet exported.

 

Z = Value of unutilized import licenses

 

A manufacturer - exporter whose ILV is insufficient (less than US500.00) or negative may file a request for import license under the bulk importation schemes provided the request is supported by export projections covered by confirmed export orders or letter of credit.

 

A Manufacturer - exporter may apply for a new import license under the bulk importation schemes provided it meets any of the following conditions:

1. Utilization of at least two-thirds (2/3) of previous import license, or
2. One month before the expiry of previous import license which has only been partially utilized.

D. Importation of Pre-Cut Fabrics

Garment exporters may import pre-cut fabrics subject to submission of the following:

1. Letter-request to GTIS-SC to import pre-cut goods with justification.

2. Sample of pre-cut goods

3. Copies of Purchase orders and Pro-forma Invoices

4. Manufacturing Process

5. Sample or Sketch of Finished Goods

6. Import License where to charge the importation of pre-cut goods.

7. BOC Certification as to the balance of the IL where the importation of pre-cut goods shall be charged.

If said garment exporter is importing under the LSI scheme, the value of pre-cut fabrics that may be granted by GTIS-SC shall be charged to the balance of the IL at the time of request. Firm is required to submit a BOC Certification as to the balance of the IL where the importation of pre-cut fabrics shall be charged.

E. Importation of Yarns

1. Requirements:

a. Duplicate original copy of Proforma Invoice
b. Duplicate original copy of Purchase Order
c. Sketch/actual sample of export product.
d. List of Subcontractors (Conversion from Yarn to Fabric and Fabric to Garments)
e. Monthly Summary of Importation of Raw Materials f. Updated Inventory of Raw Materials

2. If the applicant manufacturer-exporter is importing under the LSI/RA 3137 scheme, the value of yarns that may be granted by GTIS-SC shall be charged to the balance of the IL at the time of request. The validity of the IL for firms importing under the LSI/ RA 3137 shall be the same as the validity of the IL where the importation was charged.

3. If the garment exporter is importing under the JO scheme, the validity of the IL issued for yarn importation shall be 5 months from date of issue.

SECTION 6. Allowance for Wastages - The following limits shall be used as guide in determining allowance for wastages:

                                       

Woven fabrics/sub materials	3%
Accessories/supplies	3%
Yarn to fabric to garments	3% /10%
Knitted fabrics	10%
Pre-cut fabrics	1%

SECTION 7. Validity of Import License - An Import License shall have a validity period of nine (9) months from date of issue and shall not be extendible. Imported raw materials must arrive at the port of entry within the validity period of the Import License, otherwise, the same shall be considered as shipments without valid license.

SECTION 8. Amendment to Import License - The importer shall file with GTIS-SC a request for an amendment prior to actual importation or arrival of goods in case of any change in the quantity, price, description, construction and width of the raw materials and of supplier.

SECTION 9. Reportorial Requirements - All manufacturer - exporters shall submit to GTIS-SC an updated Notarized Report on the Usage and Inventory of Raw Materials. The report shall contain the value of approved import licenses, inventory and export/ utilization of raw materials.

Manufacturer-exporters importing under the job-order scheme are required to submit the report on a quarterly basis while those importing under the LSI or RA 3137 schemes are required to submit the report upon application for an import license.

SECTION 10. Entry and Liquidation of Raw Materials shall be Subject to the Pertinent Rules and Regulations of the Bureau of Customs

Rule VII
Effectivity

SECTION 1. Effectivity - These rules shall be effective starting January 01, 2006 after its publication in one newspaper of general circulation.

SECTION 2. Transitory Provision

License to import raw materials, license to operate Bonded Manufacturing Ware- house/Common Bonded Manufacturing Warehouse and accreditation of subcontractors previously issued by the GTEB are hereby recognized during their period of validity.

Application for import licenses, new and/or renewal of BMW/CBMW licenses, accreditation as member of CBMWs and accreditation/registration of subcontractors shall be filed with the GTIS-SC effective January 1, 2006.

SECTION 3. Consultation with Industry Associations - The GTIS-SC shall consult the garment industry, through its various associations, on all policies, amendments and/or procedures, which are not stipulated in these Rules and Regulations. All new policies, procedures and/or amendments shall be published in at least one newspaper of general circulation, posted at the GTIS-SC Bulletin Board, and sent to all industry associations.

In all cases, any policy, procedure and/or amendment to be adopted shall take effect fifteen (15) days after date of publication.

SECTION 4. Reservation Clause - Nothing herein shall be construed as precluding the GTIS-SC from enforcing these Rules, in conducting inspection, investigation, evaluation, assessment and operations audit of the activities enunciated herein, and in prescribing other requirements.

SECTION 5. Separability Clause - If, for any reason, any section or provision of these Rules is declared null and void by the competent authority, no other section, provision, or part thereof shall be affected, and the same shall remain in full force and effect.

SECTION 6. Repealing Clause - All previous Rules and Regulations inconsistent herewith are hereby repealed, amended, or modified accordingly.

Adopted: 27 Dec. 2005

(SGD.) PETER B. FAVILA
Secretary