Agreement on Customs Valuation

This is not the first multilateral regulation in the field of evaluation. The first attempt was made under Article VII of the General Agreement on Tariffs and Trade (GATT), which entered into force in 1948. As the negotiations resulted in the reduction of tariffs, the negotiators wanted to tackle the existing customs practice of assigning arbitrary or fictitious values to goods that could have nullified customs benefits. Article VII of the GATT introduced the idea that the customs value of imported goods should be based on the actual value of the imported goods. However, it did not contain a definition of value for duty or details on how to calculate the “real” value of a good. This left customs administrations a considerable margin of appreciation in their assessment. 2. (a) in determining whether the transaction value is acceptable for the purposes of paragraph 1, the fact that the buyer and seller are related within the meaning of Article 15 does not in itself constitute a reason to consider the transaction value to be unacceptable; In this case, the circumstances of the sale must be examined and the transaction value accepted, provided that the relationship did not influence the price. Where, on the basis of the information provided by the importer or for other reasons, the customs administration has reason to believe that the ratio has affected the price, it shall inform the importer accordingly and the importer shall have a reasonable opportunity to comment. At the request of the importer, reasons shall be provided in writing.

2. In drafting its legislation, each Member shall provide that the customs value shall include or exclude, in whole or in part: (ii) the cost of containers treated as a container for customs purposes with the goods concerned; (b) a system providing for the acceptance of customs duties of the higher of the two alternative values; The above evaluation methods should be used in hierarchical order. With the aim of better regulation, during the Tokyo Round of negotiations (1973-1979), Members negotiated a second separate customs agreement entitled the “GATT Valuation Code”. This agreement, which was in fact a customs code under GATT, introduced new valuation rules. The aim was to establish a predictable system that reflects the true value of goods and eliminates arbitrary or fictitious valuations. The result was the first detailed regulation of customs valuation. However, as a code under GATT, it has only been adopted by several GATT signatories. Compliance with the valuation agreement is important for U.S. exporters, particularly to ensure that market access opportunities obtained through tariff reductions are not compromised or offset by unjustified and inappropriate “increases” in the value for duty of goods subject to customs duties. The use of arbitrary and inappropriate “increases” in the valuation of goods by importing countries when applying tariffs can lead to an unjustified doubling or tripling of tariffs. (d) the buyer and seller are not related or, where the buyer and seller are related, the transaction value is acceptable for customs purposes in accordance with paragraph 2.

The agreement identifies certain situations in which the transaction value of imported goods is unacceptable for customs purposes. These occur: if there are restrictions (with a few exceptions) on the disposal or use of the goods by the buyer; if the sale or price of the goods is subject to a condition or consideration for which a value cannot be determined; if part of the proceeds from further use of the goods by the buyer accrues to the seller; or, with a few exceptions, if the buyer and seller are “related” (p.B. business partner, employer, employee, officer or director of each other`s business. 1. The laws of each Member shall provide that, for the purpose of determining the customs value, the importer or any other debtor may be entitled to an unauthorized remedy. Some developing countries also lack the legal framework and administrative capacity to implement the agreement. Insufficient information technology and computer-aided processes, including for the management of evaluation risks, are additional bottlenecks. Therefore, due to the overuse of the fallback method, the private sector may face an overload of reference prices and valuation databases. Where, when determining the customs value of the imported goods, it becomes necessary to delay the definitive determination of that customs value, the importer may nevertheless withdraw the goods from customs if the importer provides, if necessary, sufficient security in the form of a guarantee, guarantee or other appropriate instrument; on the final payment of customs duties that may be levied on the goods. The legislation of each Member provides for these circumstances.

Last but not least, the existence of a large informal sector leads to serious examination problems and a high administrative burden for customs administrations. It is often impossible for them to apply the transaction value method or any of the other valuation methods. To make matters worse, in most countries with a large informal sector, there is no mechanism for the exchange of information between importing and exporting countries. In addition, it is necessary to conclude customs cooperation and mutual administrative assistance agreements on a multilateral, regional or bilateral basis, in particular where customs has doubts about the accuracy of invoices but does not have the possibility to obtain the necessary data in its own administration. Computerization to support real-time data exchange would make this collaboration more efficient. Any information which, by its nature, is confidential or provided on a confidential basis for the purposes of customs valuation shall be kept strictly confidential by the authorities concerned, which may not disclose it without the express permission of the person or government providing such information, unless its disclosure is required in the context of legal proceedings. 3. Where, pursuant to this Article, more than one transaction value of identical goods is established, the lower value of those goods shall be used to determine the customs value of the imported goods.

In cases where it is not possible to determine the transaction value of the imported goods, the agreement provides for alternative methods of valuation. The first alternative is to set the customs value on the basis of the transaction value of identical goods sold for export to the same country. In the absence of identical goods, customs authorities shall use the transaction value of like goods sold for export to the same country. Where identical or similar goods are not sold for export to the same country, the value of identical or similar goods may be used for sale in the importing country. Alternatively, a calculated value can be used; The agreement describes how this value is to be calculated. If all else fails, the customs authorities shall use “reasonable means consistent with the principles and general provisions of this Agreement” to determine the value of the imported goods. The Committee on Customs Valuation of the Council for Trade in Goods (CGT) is working at the WTO on a series of measures to facilitate trade at customs value. The current president is. 3. Members of industrialized countries shall provide technical assistance to developing countries upon request, on mutually agreed terms. On this basis, members of industrialized countries shall develop technical assistance programmes, which may include, inter alia, training of personnel, assistance in the preparation of implementing measures, access to sources of information on the method of customs valuation and advice on the application of the provisions of this Convention. 1.

The principal taxable amount of the customs value under this Agreement shall be the transaction value within the meaning of Article 1. Article 1 shall be replaced jointly by Article 8, which shall include: provides for adjustments to the price actually paid or payable where certain specific items considered to be part of the customs value are incurred by the buyer but are not included in the price actually paid or payable for the imported goods. Article 8 also provides for the inclusion in the transaction value of certain counterparties that may pass from the buyer to the seller in the form of certain goods or services and not in the form of money. Articles 2 to 7 provide for methods for determining the customs value where it cannot be determined in accordance with Article 1. The CVA is, in fact, a highly technical and complex agreement that requires expertise in technical assessment rules, ranging from basic requirements for the implementation of transaction value to complex issues such as transfer pricing, royalties and royalties, and e-commerce business models. Therefore, a sustainable mechanism is needed to ensure the continued capacity building of Customs and the private sector, including through the development of university courses. The CVA identifies the main basis, namely the default mechanism to be used for valuation, as the “transaction value”, which it defines as “the price actually paid or payable for the goods when they are sold for export to the importing country” (Article 1). Therefore, the value should be based on the sale price agreed between the buyer and the seller, which appears on the invoice.

The agreement also includes in the transaction value other elements that affect the value of the goods that do not appear on the invoice (Article 8). .