BOC eyes PPP to fully digitize operations, curb corruption and smuggling

The Bureau of Customs (BOC) will utilize the public-private partnership (PPP) mechanism to fully digitize all its operations in a bid to eliminate corruption and smuggling within the agency, as the bureau currently lacks the budget to fund the initiative.

“The number one solution for our problem in the BOC is full digitalization of our processes, not partial, not even 99 percent, but 100 percent. Other countries are now doing it, and it’s not new anymore. It is available now, and what we have to do is just adapt,” said Customs Commissioner Ariel Nepomuceno during his speech at the 2025 Business Summit of the Federation of Philippine Industries held Wednesday at the Manila Polo Club in Makati City.

“The question is, do we have the budget for that? And my answer is none, but there’s a solution for that,” he added.

Nepomuceno said that when he assumed office as BOC Commissioner last July—midway through the fiscal year—no funds had been allotted for digitization.

The same issue arose in the National Expenditure Program (NEP) 2026, which was already finalized when he entered the post.

“During our budget hearing, unfortunately, funding for the digitization is not included in the NEP 2026. And we can’t suggest any insertion, especially this time, because it will invoke a lot of fear and anger. So, the last option is PPP, in which we just have to ensure that the minimum capabilities and features of a fully digitized process would be there,” the BOC chief explained.

Nepomuceno added that during his meeting with President Ferdinand Marcos Jr., the Chief Executive expressed full support for the bureau’s digitalization push.

One of the key components of the plan is the Customs Processing System (CPS).

“It means that the import entry in the BOC will be submitted digitally. With the use of fingertips, importers and exporters can easily transact without talking to any BOC personnel. No human intervention anymore. The assessment will also be done digitally up to release. When that’s done, tampering will be avoided, as well as corruption and smuggling,” he said.

Nepomuceno said that the proposal for the BOC’s digitalization has already been submitted to the PPP Center, and the bureau must ensure that all required features and capabilities are in place.

The previous BOC administration had earlier initiated several digital processes, including the Enhanced e-Travel System, the ATA Carnet Monitoring System, and the Customs Auction Monitoring System.

Meanwhile, Nepomuceno revealed that with the anticipated entry of goods with zero tariffs from the United States — part of the 19 percent U.S. tariff concession with the Philippines — the bureau projects P30 billion in revenue losses.

“If we are going to use the data from last year, the entry of goods with zero tariffs from the U.S. would cost about P30 billion, and that would affect our collection data for the year,” he said.

To offset the expected losses, Nepomuceno said the BOC and the Department of Finance (DOF) will convene to identify stronger revenue collection measures to compensate for the decline.