How to Get Duty Exemptions on Recovered Goods and Salvaged Vessels

When a ship meets with an accident or is left behind in the water, items recovered from it can enter the Philippines without the usual import duties. This rule covers goods found inside, the parts of the foreign ship itself, and even its equipment - whether the vessel was wrecked in Philippine waters or elsewhere. Allowing them to enter duty-free helps maritime companies and salvors recover value from what would otherwise be lost at sea.

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Conditions for the Exemption

• The goods and salvage must come from foreign vessels that were wrecked or abandoned.
• The wreck or abandonment can happen in Philippine waters or anywhere else in the world.
• The recovery must happen after a period of at least two (2) years.
• The two-year clock starts either from the date the marine protest was filed or from the time the vessel was wrecked or abandoned.
• Any goods or salvage recovered within the two-year period remain dutiable - the importer must pay the full taxes.

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Required Documents

• A Tax and Duty Exemption Indorsement (TEI) with all supporting papers
• The official Inventory Report made by the Customs Examiner
• A Certification or Report from MARINA
• The standard Goods Declaration

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Step-by-Step Import Process

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1. Monitor the Timeline

The importer tracks the date the ship was wrecked or the date the marine protest was filed. They must wait for the full two-year period to end before claiming the tax exemption. Goods brought in early will be subject to full duty.

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2. Conduct the Recovery and Salvage

The importer or salvage team retrieves the goods, parts, or equipment from the foreign vessel and keeps them together for official inspection.

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3. Request a MARINA Report

The importer contacts the Maritime Industry Authority (MARINA) and secures an official certification or report confirming the vessel was wrecked or abandoned.

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4. Undergo Customs Inspection

Once the goods are in the custody of the Bureau of Customs, a Customs Examiner performs a physical check and creates an Inventory Report listing exactly what was recovered and its condition.

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5. Apply for Tax Exemption (TEI)

The importer files an application for a Tax and Duty Exemption Indorsement (TEI), submitting the MARINA report and the Customs Inventory Report as proof that the shipment meets the legal requirements. A licensed customs broker can help prepare and file the necessary documentation accurately.

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6. File the Goods Declaration

The importer submits the Goods Declaration along with the approved TEI, confirming that the items are entering the country legally but exempt from import duties.

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7. Release of Goods

After the Bureau of Customs verifies the two-year rule and the documents, they process the clearance and the importer receives the goods.