Philippine

Central
Product
Classification
Primer

Pambansang Lupon sa Ugnayang Pang-Estadistika

(National Statistical Coordination Board)
Makati City, Philippines
1999
 INTRODUCTION

The National Statistical Coordination Board (NSCB), created by virtue of

Executive Order No. 121, serves as the highest policy-making and coordinating body
on statistical matters in the country. One of its functions is to prescribe uniform
standards and classification systems in the government statistics. In pursuance of this
function, the NSCB continually develops and maintains statistical standards and
classification systems for adoption by government agencies.

At present, there are six (6) statistical standard classification systems that have
been developed and prescribed for adoption, namely: The Philippine Standard
Commodity Classification (PSCC), which is a detailed classification of all
commodities that enter the Philippine trade; the Philippine Standard Occupational
Classification (PSOC), which is a classification of the various occupations of the
labor force of the country, including those of the military; the Philippine
Classification of Commodities by Broad Economic Categories (PCCBEC), which is a
classification of commodities that enter the Philippine trade according to their main
end use; the Philippine Standard Geographic Classification (PSGC), which presents a
systematic classification and coding of geographic areas of the country; the Updated
Philippine Standard Classification of Education (PSCED), which is a classification of
the various course programs within the different levels of our educational system; the
Philippine Standard Industrial Classification (PSIC), which is a classification of
industries prevailing in the country according to their specific economic activities;
and the Philippine Central Product Classification (PCPC), which is a system of
different but interrelated classifications of economic activities and goods and services.

These standard classification systems are being updated and revised

periodically by the NSCB to reflect socio-economic developments in the country.

Philippine Central Product Classification Page 1

 PHILIPPINE CENTRAL PRODUCT CLASSIFICATION
PRIMER

What is the Philippine Central Product Classification (PCPC)?

⇒ The Philippine Central Product Classification is a standard classification of

goods and services including tangible and intangible assets based on their
physical properties and intrinsic nature as well as industrial origin.

⇒ It is a standard classification that will provide a link between product and

industry or economic activity. Therefore, it is a linkage between the
Philippine Standard Commodity Classification (PSCC) and the Philippine
Standard Industrial Classification (PSIC).

What is the purpose of the PCPC?

⇒ To provide a framework in the compilation and presentation of production and

trade data on goods and services by industrial origin.

⇒ To be an instrument for assembling and tabulating all kinds of statistics that

needed product detail.. Such statistics may cover production, intermediate and
final consumption, capital formation and foreign trade and may refer to
commodity flows, stocks or balances and may be compiled in the context of
input-output tables, balance-of-payments and other analytical presentations.

⇒ To enhance harmonization among various fields of economic and related

statistics; and,

⇒ To strengthen the role of the national accounts and balances as an intrument

for coordination of economic statistics.

What are the uses of the PCPC?

⇒ To be used for different types of statistics, for example, industrial statistics and
national accounts, price statistics, foreign trade statistics (including trade-in
services) and balance-of-payments statistics.

⇒ As a supplement to other recommended classifications (such as the PSCC for

foreign trade statistics).

⇒ As a basis for recompiling basic statistics for analytical use from their original
classifications into a standard classification (PCPC).
⇒ As a general-purpose product classification, it may serve as a guideline for
future product-type classifications for specific areas in the economy. Such
specific classifications should be compatible with the general framework of
PCPC so that comparability of data will be ensured.

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Who were responsible for the preparation of the PCPC?

⇒ The Classifications and Standards Division (CSD) under the Statistical

Programs and Resource Management Office (SPRMO) of the National
Statistical Coordination Board (NSCB) in coordination with specialists from
concerned government agencies through the Technical Working Group on
Philippine Central Product Classification (TWG-PCPC). Created by the
NSCB Technical Committee on Statistical Standards and Classifications, the
TWG-PCPC is composed of representatives from the following agencies:
Department of Trade and Industry (DTI), National Statistics Office (NSO),
Tariff Commission (TC), Bureau of Labor and Employment Statistics (BLES),
Bureau of Agricultural Statistics (BAS), Bangko Sentral ng Pilipinas (BSP),
Securities and Exchange Commission (SEC), National Economic and
Development Authority (NEDA), Board of Investments (BOI), and the
National Statistical Coordination Board (NSCB).

What is the implementing mechanism of the PCPC?

⇒ The PCPC is prescribed for adoption and implementation by all government

agencies, offices and instrumentalities covered by virtue of NSCB Resolution
No. 13, series of 2002.

What is the scope of the PCPC?

⇒ PCPC includes categories for all products that can be the object of a domestic
or international transaction or that can be entered into stocks. Furthermore,
not only products that are an output of economic activity are represented,
including transportable goods and non-transportable goods and services, but
also non-produced assets, including land and assets that arise from legal
contracts, such as patents, licenses, trademarks and copyrights (intangible
assets).

⇒ Although the non-produced assets are not regarded as products in the System
of National Accounts (SNA), it was considered useful to include them in the
PCPC because there is substantial national and international trade in them, and
many users are interested in such data.

What were the principles used in constructing PCPC?

⇒ The PCPC is a system of categories covering both goods and services that is
both exhaustive and mutually exclusive. Consistent with the other principles
used, homogeneity within categories is maximized. PCPC categories for
transportable goods are based on the physical properties and the intrinsic
nature of the products, as in the HS and the PSCC. To some extent this also
applies to their aggregations, but additionally a close relationship with the
PSIC (industrial origin criterion) is maintained.

⇒ For the part dealing with transportable goods, the PCPC, with one exception,
uses the headings and subheadings of the HS as building blocks, i.e., each

Philippine Central Product Classification Page 3

 PCPC subclass is an aggregate of one or more headings or subheadings of the
HS. An advantage of this relationship is that since the HS is used for foreign
trade statistics and for production statistics, the introduction of the PCPC is
facilitated.

⇒ The expression “physical properties and intrinsic nature” means criteria that
are proper to the goods themselves, e.g., the raw materials of which they are
made, their stage of production, the way in which they are produced, the
purpose or user category for which they are intended, the prices at which they
are sold, whether or not they can be stored, etc.

What is the coding system of the classification?

⇒ The coding system of PCPC is hierarchical and purely decimal.

⇒ The code numbers in PCPC consist of six digits without separation of any kind
between digits.

⇒ The codes for the sections range from 0 through 9 and each section may be
divided into nine divisions. At the third digit of the code each division may, in
turn, be divided into nine groups which may then be further divided into nine
classes and then again into nine subclasses. The subclasses may again be
divided into nine items.

⇒ Where a given level of classification is not further subdivided, a “0” is used in

the position for the next more detailed level. For example, the code for item
“Financial assets and liabilities” is 511000, since the group “Financial assets
and liabilities” (code 511) is divided neither into classes nor into subclasses.

What are the levels of disaggregation of the classification?

⇒ The classification consists of sections (identified by the first digit), divisions

(identified by the first and second digits taken together), groups (identified by
the first, second and third digits taken together), classes (identified by the first,
second, third and fourth digits taken together), subclasses (identified by all
five digits taken together), and items (identified by the six digits altogether).

⇒ The classification has 10 sections, 71 divisions, 294 groups, 1,162

classes, ---subclasses and ---items.

How is a specific goods or service identified?

⇒ A specific goods or service is completely identified by the assignment of a six

digit numerical code. For example, Wholesale trade services, except on a
fee or contract basis, of fish and other seafoods was coded 611240.

Philippine Central Product Classification Page 4

⇒ To illustrate:

6 1 1 2 4 0

Section
Distributive Trade Services; Lodging;
Food and Beverage Serving Services;
Transport Services; and Utilities
Distribution Services

Division
Wholesale Trade Services

Group
Wholesale Trade Services,
Except on a Fee or Contract Basis

Class
Wholesale Trade Services,
Except on a Fee or Contract Basis,
of Food, Beverages and Tobacco

Subclass
Wholesale Trade Services, Except on
a Fee or Contract Basis, of Fish and
other Seafoods

Item
Wholesale Trade Services, Except on
a Fee or Contract Basis, of Fish and
other Seafoods

EXHIBIT: A prototype of the classification headings

Group Class Sub- Item Title UN- 1994 ISIC HSP PSCC
Class CPC PSIC Rev.3 Rev.2

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