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Custom valuation

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Custom duties

Specific and ad valorem customs duties

In case of a specific duty, a concrete sum is

charged for a quantitative description of the

good

In contrast, an ad valorem duty depends on

the value of a good

Basics to know custom

valuation

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CUSTOM VALUATION

Customs valuation is a customs procedure

applied to determine the customs value of

imported goods If the rate of duty is ad valorem, the

customs value is essential to determine the

duty to be paid on an imported good.

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History of Agrmnt on

customs valuation Article VII of GATT 1!"

general principles for an international system

of valuation. The To#yo $ound Code

  transaction value%

The &T' Agreement on Implementation of

Article VII of GATT 1! (Customs Valuation

Agreement)

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!"at #os t" Agrmnt #o$

*rovides uniformity and certainty

Transparency and consistency

 +eutral system for valuation of goods

asis should be the transaction value

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Customs valuation mt"o#s

*rimary basis for customs value is -transaction value%

of the goods sold

If customs value cannot be determined on the basis of

transaction value of the goods, alternative methods are provided

  //transaction value of identical goods

  //transaction value of similar goods

  //deductive value  //computed value

  //%fall/bac#% method

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Transaction valu

  Price actually paid or payable for the

goods 0hen sold for eport to the country

of importation ad2usted in accordance 0ith

the provisions of Article 3 of the Agreement

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Transaction valu%%con#itions

1 / no restriction on the disposition or use 

of the goods by the buyer, other than

  //imposed or required by la0 or public authorities in thecountry of importation

  //limiting the geographical area in 0hich the goods may

 be resold do not substantially affect the value of the goods

4 / no part of the proceeds will accrue tothe seller, unless ad2ustment is made

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Transaction valu of i#ntical

or similar goo#s If transaction value of goods sold cannot be

used for valuation,

  1. Transaction value of identical goods

  4. Transaction value of similar goods

Conditions for use

  //the goods must be sold to the same country of

importation as the goods being valued

  //the goods must be eported at or about the same times

as the goods being valued

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)#uctiv an# com*ut#

valu If transaction value for the goods, or for

identical or similar goods cannot be used,

/ 6eductive value

/ Computed value

the importer has the right to choose the order

of application of the t0o methods

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+,all%-ack. mt"o# If none of the previous methods can be used, value can

 be determined using reasonable means consistent withthe principles and general provisions of the

Agreement and of Article VII of GATT 1! In this method, value must not be based on  /selling price of goods in country of importation

  /higher of t0o alternative values

  /price of goods on domestic mar#et of eporting country

  /cost of production other than computed values for identical or

similar goods

  /price of goods for eport to a third country

  /minimum customs value

/arbitrary or fictitious values

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S*cial an# )iffrntial

Tratmnt Transition periods for developing countries

  7ive year delayed implementation for

developing countries not parties to the To#yo

$ound Code

  Three years for the application of the

computed value method

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Im*lmntation Situation

89 6eveloping Countries originally requested the 8/yeardelay period (Art. 4:.1)

45 are still under the delay period, have been granted an

etension, or are in the process of requesting an etension

3 have implemented

48 have not notified nor as#ed for an etension, thus the

situation is unclear 

An additional 4! have not notified the delay, nor legislation.

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Ot"r )lays or /srvations&ith respect to Computed values

!" ;embers have made such a notification

&ith respect to ;inimum values

13 ;embers have made such a notification

&ith respect to the right of the importer to choose bet0een deducted and computed value

85 ;embers have made such a notification

&ith respect to certain aspects of using thedeductive valuation method

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T" 0n#

  Than# you