Annex
I: Interpretative
Notes
General
Note
Sequential
Application of Valuation Methods
1.
Articles 1 through 7 define how the customs value of imported goods is
to be determined under the provisions of this Agreement. The
methods of valuation are set out in a sequential order of application.
The primary method for customs valuation is defined in Article 1 and
imported goods are to be valued in accordance with the provisions of
this Article whenever the conditions prescribed therein are fulfilled.
2.
Where the customs value cannot be determined under the provisions of
Article 1, it is to be determined by proceeding sequentially through
the succeeding Articles to the first such Article under which the
customs value can be determined. Except as provided in Article
4, it is only when the customs value cannot be determined under the
provisions of a particular Article that the provisions of the next
Article in the sequence can be used.
3.
If the importer does not request that the order of Articles 5 and 6 be
reversed, the normal order of the sequence is to be followed. If
the importer does so request but it then proves impossible to
determine the customs value under the provisions of Article 6, the
customs value is to be determined under the provisions of Article 5,
if it can be so determined.
4.
Where the customs value cannot be determined under the provisions of
Articles 1 through 6 it is to be determined under the provisions of
Article 7.
Use
of Generally Accepted Accounting Principles
1.
“Generally accepted accounting principles” refers to the
recognized consensus or substantial authoritative support within a
country at a particular time as to which economic resources and
obligations should be recorded as assets and liabilities, which
changes in assets and liabilities should be recorded, how the assets
and liabilities and changes in them should be measured, what
information should be disclosed and how it should be disclosed, and
which financial statements should be prepared. These standards
may be broad guidelines of general application as well as detailed
practices and procedures.
2.
For the purposes of this Agreement, the customs administration of each
Member shall utilize information prepared in a manner consistent with
generally accepted accounting principles in the country which is
appropriate for the Article in question. For example, the
determination of usual profit and general expenses under the
provisions of Article 5 would be carried out utilizing information
prepared in a manner consistent with generally accepted accounting
principles of the country of importation. On the other hand, the
determination of usual profit and general expenses under the
provisions of Article 6 would be carried out utilizing
information prepared in a manner consistent with generally accepted
accounting principles of the country of production. As a further
example, the determination of an element provided for in paragraph 1(b)(ii)
of Article 8 undertaken in the country of importation would be carried
out utilizing information in a manner consistent with the generally
accepted accounting principles of that country.
Price
Actually Paid or Payable
1.
The price actually paid or payable is the total payment made or to be
made by the buyer to or for the benefit of the seller for the imported
goods. The payment need not necessarily take the form of a
transfer of money. Payment may be made by way of letters of
credit or negotiable instruments. Payment may be made directly
or indirectly. An example of an indirect payment would be the
settlement by the buyer, whether in whole or in part, of a debt owed
by the seller.
2.
Activities undertaken by the buyer on the buyer’s own account, other
than those for which an adjustment is provided in Article 8, are not
considered to be an indirect payment to the seller, even though they
might be regarded as of benefit to the seller. The costs of such
activities shall not, therefore, be added to the price actually paid
or payable in determining the customs value.
3.
The customs value shall not include the following charges or costs,
provided that they are distinguished from the price actually paid or
payable for the imported goods:
(a)
charges for construction, erection, assembly, maintenance or technical
assistance, undertaken after importation on imported goods such as
industrial plant, machinery or equipment;
(b)
the cost of transport after importation;
(c)
duties and taxes of the country of importation.
4.
The price actually paid or payable refers to the price for the
imported goods. Thus the flow of dividends or other payments
from the buyer to the seller that do not relate to the imported goods
are not part of the customs value.
Paragraph
1(a)(iii)
Among restrictions which would not render a price actually paid or
payable unacceptable are restrictions which do not substantially
affect the value of the goods. An example of such restrictions
would be the case where a seller requires a buyer of automobiles not
to sell or exhibit them prior to a fixed date which represents the
beginning of a model year.
Paragraph
1(b)
1.
If the sale or price is subject to some condition or consideration for
which a value cannot be determined with respect to the goods being
valued, the transaction value shall not be acceptable for customs
purposes. Some examples of this include:
(a)
the seller establishes the price of the imported goods on condition
that the buyer will also buy other goods in specified quantities;
(b)
the price of the imported goods is dependent upon the price or prices
at which the buyer of the imported goods sells other goods to the
seller of the imported goods;
(c)
the price is established on the basis of a form of payment extraneous
to the imported goods, such as where the imported goods are
semi-finished goods which have been provided by the seller on
condition that the seller will receive a specified quantity of the
finished goods.
2.
However, conditions or considerations relating to the production or
marketing of the imported goods shall not result in rejection of the
transaction value. For example, the fact that the buyer
furnishes the seller with engineering and plans undertaken in the
country of importation shall not result in rejection of the
transaction value for the purposes of Article 1. Likewise, if
the buyer undertakes on the buyer’s own account, even though by
agreement with the seller, activities relating to the marketing of the
imported goods, the value of these activities is not part of the
customs value nor shall such activities result in rejection of the
transaction value.
Paragraph
2
1.
Paragraphs 2(a) and 2(b) provide different means of establishing the
acceptability of a transaction value.
2.
Paragraph 2(a) provides that where the buyer and the seller are
related, the circumstances surrounding the sale shall be examined and
the transaction value shall be accepted as the customs value provided
that the relationship did not influence the price. It is not
intended that there should be an examination of the circumstances in
all cases where the buyer and the seller are related. Such
examination will only be required where there are doubts about the
acceptability of the price. Where the customs administration
have no doubts about the acceptability of the price, it should be
accepted without requesting further information from the importer.
For example, the customs administration may have previously examined
the relationship, or it may already have detailed information
concerning the buyer and the seller, and may already be satisfied from
such examination or information that the relationship did not
influence the price.
3.
Where the customs administration is unable to accept the transaction
value without further inquiry, it should give the importer an
opportunity to supply such further detailed information as may be
necessary to enable it to examine the circumstances surrounding the
sale. In this context, the customs administration should be
prepared to examine relevant aspects of the transaction, including the
way in which the buyer and seller organize their commercial relations
and the way in which the price in question was arrived at, in order to
determine whether the relationship influenced the price. Where
it can be shown that the buyer and seller, although related under the
provisions of Article 15, buy from and sell to each other as if they
were not related, this would demonstrate that the price had not been
influenced by the relationship. As an example of this, if the
price had been settled in a manner consistent with the normal pricing
practices of the industry in question or with the way the seller
settles prices for sales to buyers who are not related to the seller,
this would demonstrate that the price had not been influenced by the
relationship. As a further example, where it is shown that the
price is adequate to ensure recovery of all costs plus a profit which
is representative of the firm’s overall profit realized over a
representative period of time (e.g. on an annual basis) in sales of
goods of the same class or kind, this would demonstrate that the price
had not been influenced.
4.
Paragraph 2(b) provides an opportunity for the importer to demonstrate
that the transaction value closely approximates to a “test” value
previously accepted by the customs administration and is therefore
acceptable under the provisions of Article 1. Where a test under
paragraph 2(b) is met, it is not necessary to examine the question of
influence under paragraph 2(a). If the customs administration
has already sufficient information to be satisfied, without further
detailed inquiries, that one of the tests provided in paragraph 2(b)
has been met, there is no reason for it to require the importer to
demonstrate that the test can be met. In paragraph 2(b) the term
“unrelated buyers” means buyers who are not related to the seller
in any particular case.
Paragraph
2(b)
A number of factors must be taken into consideration in determining
whether one value “closely approximates” to another value.
These factors include the nature of the imported goods, the nature of
the industry itself, the season in which the goods are imported, and,
whether the difference in values is commercially significant.
Since these factors may vary from case to case, it would be impossible
to apply a uniform standard such as a fixed percentage, in each case.
For example, a small difference in value in a case involving one type
of goods could be unacceptable while a large difference in a case
involving another type of goods might be acceptable in determining
whether the transaction value closely approximates to the “test”
values set forth in paragraph 2(b) of Article 1.
1.
In applying Article 2, the customs administration shall, wherever
possible, use a sale of identical goods at the same commercial level
and in substantially the same quantities as the goods being valued.
Where no such sale is found, a sale of identical goods that takes
place under any one of the following three conditions may be used:
(a)
a sale at the same commercial level but in different quantities;
(b)
a sale at a different commercial level but in substantially the same
quantities; or
(c)
a sale at a different commercial level and in different quantities.
2.
Having found a sale under any one of these three conditions
adjustments will then be made, as the case may be, for:
(a)
quantity factors only;
(b)
commercial level factors only; or
(c)
both commercial level and quantity factors.
3.
The expression “and/or” allows the flexibility to use the
sales and make the necessary adjustments in any one of the three
conditions described above.
4.
For the purposes of Article 2, the transaction value of identical
imported goods means a customs value, adjusted as provided for in
paragraphs 1(b) and 2, which has already been accepted under Article 1.
5.
A condition for adjustment because of different commercial levels or
different quantities is that such adjustment, whether it leads to an
increase or a decrease in the value, be made only on the basis of
demonstrated evidence that clearly establishes the reasonableness and
accuracy of the adjustments, e.g. valid price lists containing prices
referring to different levels or different quantities. As an
example of this, if the imported goods being valued consist of a
shipment of 10 units and the only identical imported goods for which a
transaction value exists involved a sale of 500 units, and it is
recognized that the seller grants quantity discounts, the required
adjustment may be accomplished by resorting to the seller’s price list
and using that price applicable to a sale of 10 units. This does
not require that a sale had to have been made in quantities of 10 as
long as the price list has been established as being bona fide
through sales at other quantities. In the absence of such an
objective measure, however, the determination of a customs value under
the provisions of Article 2 is not appropriate.
1.
In applying Article 3, the customs administration shall, wherever
possible, use a sale of similar goods at the same commercial level and
in substantially the same quantities as the goods being valued.
Where no such sale is found, a sale of similar goods that takes place
under any one of the following three conditions may be used:
(a)
a sale at the same commercial level but in different quantities;
(b)
a sale at a different commercial level but in substantially the same
quantities; or
(c)
a sale at a different commercial level and in different quantities.
2.
Having found a sale under any one of these three conditions
adjustments will then be made, as the case may be, for:
(a)
quantity factors only;
(b)
commercial level factors only; or
(c)
both commercial level and quantity factors.
3.
The expression “and/or” allows the flexibility to use the
sales and make the necessary adjustments in any one of the three
conditions described above.
4.
For the purpose of Article 3, the transaction value of similar
imported goods means a customs value, adjusted as provided for in
paragraphs 1(b) and 2, which has already been accepted under Article 1.
5.
A condition for adjustment because of different commercial levels or
different quantities is that such adjustment, whether it leads to an
increase or a decrease in the value, be made only on the basis of
demonstrated evidence that clearly establishes the reasonableness and
accuracy of the adjustment, e.g. valid price lists containing prices
referring to different levels or different quantities. As an
example of this, if the imported goods being valued consist of a
shipment of 10 units and the only similar imported goods for which a
transaction value exists involved a sale of 500 units, and it is
recognized that the seller grants quantity discounts, the required
adjustment may be accomplished by resorting to the seller’s price list
and using that price applicable to a sale of 10 units. This does
not require that a sale had to have been made in quantities of 10 as
long as the price list has been established as being bona fide
through sales at other quantities. In the absence of such an
objective measure, however, the determination of a customs value under
the provisions of Article 3 is not appropriate.
1.
The term “unit price at which ... goods are sold in the greatest
aggregate quantity” means the price at which the greatest number
of units is sold in sales to persons who are not related to the
persons from whom they buy such goods at the first commercial level
after importation at which such sales take place.
2.
As an example of this, goods are sold from a price list which grants
favourable unit prices for purchases made in larger quantities.
|
Sale
quantity
|
Unit
price
|
Number
of sales
|
Total
quantity
sold
at each price
|
|
1-10
units
|
100
|
10
sales of 5 units
5
sales of 3 units
|
65
|
|
11-25
units
|
95
|
5
sales of 11 units
|
55
|
|
over
25 units
|
90
|
1
sale of 30 units
1
sale of 50 units
|
80
|
The greatest number of units sold at a price is 80; therefore,
the unit price in the greatest aggregate quantity is 90.
3.
As another example of this, two sales occur. In the first sale
500 units are sold at a price of 95 currency units each. In the
second sale 400 units are sold at a price of 90 currency units each.
In this example, the greatest number of units sold at a particular
price is 500; therefore, the unit price in the greatest
aggregate quantity is 95.
4.
A third example would be the following situation where various
quantities are sold at various prices.
|
(a)
Sales
|
|
|
Sale
quantity
|
Unit
price
|
|
40
units
|
100
|
|
30
units
|
90
|
|
15
units
|
100
|
|
50
units
|
95
|
|
25
units
|
105
|
|
35
units
|
90
|
|
5
units
|
100
|
|
(b)
Totals
|
|
|
Total
quantity sold
|
Unit
price
|
|
65
|
90
|
|
50
|
95
|
|
60
|
100
|
|
25
|
105
|
In this example, the greatest number of units sold at a particular
price is 65; therefore, the unit price in the greatest aggregate
quantity is 90.
5.
Any sale in the importing country, as described in paragraph 1
above, to a person who supplies directly or indirectly free of charge
or at reduced cost for use in connection with the production and sale
for export of the imported goods any of the elements specified in
paragraph 1(b) of Article 8, should not be taken into
account in establishing the unit price for the purposes of Article 5.
6.
It should be noted that “profit and general expenses”
referred to in paragraph 1 of Article 5 should be taken as a
whole. The figure for the purposes of this deduction should be
determined on the basis of information supplied by or on behalf of the
importer unless the importer’s figures are inconsistent with those
obtained in sales in the country of importation of imported goods of
the same class or kind. Where the importer’s figures are inconsistent
with such figures, the amount for profit and general expenses may be
based upon relevant information other than that supplied by or on
behalf of the importer.
7.
The “general expenses” include the direct and indirect costs
of marketing the goods in question.
8.
Local taxes payable by reason of the sale of the goods for which a
deduction is not made under the provisions of paragraph 1(a)(iv)
of Article 5 shall be deducted under the provisions of paragraph 1(a)(i)
of Article 5.
9.
In determining either the commissions or the usual profits and general
expenses under the provisions of paragraph 1 of Article 5, the
question whether certain goods are “of the same class or
kind” as other goods must be determined on a case-by-case basis
by reference to the circumstances involved. Sales in the country
of importation of the narrowest group or range of imported goods of
the same class or kind, which includes the goods being valued, for
which the necessary information can be provided, should be examined.
For the purposes of Article 5, “goods of the same class or
kind” includes goods imported from the same country as the goods
being valued as well as goods imported from other countries.
10.
For the purposes of paragraph 1(b) of Article 5, the “earliest date” shall be the date by which sales of the
imported goods or of identical or similar imported goods are made in
sufficient quantity to establish the unit price.
11.
Where the method in paragraph 2 of Article 5 is used, deductions
made for the value added by further processing shall be based on
objective and quantifiable data relating to the cost of such work.
Accepted industry formulas, recipes, methods of construction, and
other industry practices would form the basis of the calculations.
12.
It is recognized that the method of valuation provided for in
paragraph 2 of Article 5 would normally not be applicable
when, as a result of the further processing, the imported goods lose
their identity. However, there can be instances where, although the
identity of the imported goods is lost, the value added by the
processing can be determined accurately without unreasonable
difficulty. On the other hand, there can also be instances where
the imported goods maintain their identity but form such a minor
element in the goods sold in the country of importation that the use
of this valuation method would be unjustified. In view of the
above, each situation of this type must be considered on a
case-by-case basis.
1.
As a general rule, customs value is determined under this Agreement on
the basis of information readily available in the country of
importation. In order to determine a computed value, however, it
may be necessary to examine the costs of producing the goods being
valued and other information which has to be obtained from outside the
country of importation. Furthermore, in most cases the producer
of the goods will be outside the jurisdiction of the authorities of
the country of importation. The use of the computed value method
will generally be limited to those cases where the buyer and seller
are related, and the producer is prepared to supply to the authorities
of the country of importation the necessary costings and to provide
facilities for any subsequent verification which may be necessary.
2.
The “cost or value” referred to in paragraph 1(a) of
Article 6 is to be determined on the basis of information
relating to the production of the goods being valued supplied by or on
behalf of the producer. It is to be based upon the commercial
accounts of the producer, provided that such accounts are consistent
with the generally accepted accounting principles applied in the
country where the goods are produced.
3.
The “cost or value” shall include the cost of elements
specified in paragraphs 1(a)(ii) and (iii) of Article 8.
It shall also include the value, apportioned as appropriate under the
provisions of the relevant note to Article 8, of any element
specified in paragraph 1(b) of Article 8 which has been supplied
directly or indirectly by the buyer for use in connection with the
production of the imported goods. The value of the elements
specified in paragraph 1(b)(iv) of Article 8 which are undertaken
in the country of importation shall be included only to the extent
that such elements are charged to the producer. It is to be
understood that no cost or value of the elements referred to in this
paragraph shall be counted twice in determining the computed value.
4.
The “amount for profit and general expenses” referred to in
paragraph 1(b) of Article 6 is to be determined on the basis
of information supplied by or on behalf of the producer unless the
producer’s figures are inconsistent with those usually reflected in
sales of goods of the same class or kind as the goods being valued
which are made by producers in the country of exportation for export
to the country of importation.
5.
It should be noted in this context that the “amount for profit
and general expenses” has to be taken as a whole. It
follows that if, in any particular case, the producer’s profit figure
is low and the producer’s general expenses are high, the producer’s
profit and general expenses taken together may nevertheless be
consistent with that usually reflected in sales of goods of the same
class or kind. Such a situation might occur, for example, if a
product were being launched in the country of importation and the
producer accepted a nil or low profit to offset high general expenses
associated with the launch. Where the producer can demonstrate a
low profit on sales of the imported goods because of particular
commercial circumstances, the producer’s actual profit figures should
be taken into account provided that the producer has valid commercial
reasons to justify them and the producer’s pricing policy reflects
usual pricing policies in the branch of industry concerned. Such
a situation might occur, for example, where producers have been forced
to lower prices temporarily because of an unforeseeable drop in
demand, or where they sell goods to complement a range of goods being
produced in the country of importation and accept a low profit to
maintain competitivity. Where the producer’s own figures for
profit and general expenses are not consistent with those usually
reflected in sales of goods of the same class or kind as the goods
being valued which are made by producers in the country of exportation
for export to the country of importation, the amount for profit and
general expenses may be based upon relevant information other than
that supplied by or on behalf of the producer of the goods.
6.
Where information other than that supplied by or on behalf of the
producer is used for the purposes of determining a computed value, the
authorities of the importing country shall inform the importer, if the
latter so requests, of the source of such information, the data used
and the calculations based upon such data, subject to the provisions
of Article 10.
7.
The “general expenses” referred to in paragraph 1(b) of
Article 6 covers the direct and indirect costs of producing and
selling the goods for export which are not included under paragraph 1(a)
of Article 6.
8.
Whether certain goods are “of the same class or kind” as
other goods must be determined on a case-by-case basis with reference
to the circumstances involved. In determining the usual profits
and general expenses under the provisions of Article 6, sales for
export to the country of importation of the narrowest group or range
of goods, which includes the goods being valued, for which the
necessary information can be provided, should be examined. For
the purposes of Article 6, “goods of the same class or kind”
must be from the same country as the goods being valued.
1.
Customs values determined under the provisions of Article 7 should, to
the greatest extent possible, be based on previously determined
customs values.
2.
The methods of valuation to be employed under Article 7 should be
those laid down in Articles 1 through 6 but a reasonable
flexibility in the application of such methods would be in conformity
with the aims and provisions of Article 7.
3.
Some examples of reasonable flexibility are as follows:
(a)
Identical goods — the requirement that the identical goods should be
exported at or about the same time as the goods being valued could be
flexibly interpreted; identical imported goods produced in a
country other than the country of exportation of the goods being
valued could be the basis for customs valuation; customs values
of identical imported goods already determined under the provisions of
Articles 5 and 6 could be used.
(b)
Similar goods — the requirement that the similar goods should be
exported at or about the same time as the goods being valued could be
flexibly interpreted; similar imported goods produced in a
country other than the country of exportation of the goods being
valued could be the basis for customs valuation; customs values
of similar imported goods already determined under the provisions of
Articles 5 and 6 could be used.
(c)
Deductive method — the requirement that the goods shall have been
sold in the “condition as imported” in paragraph 1(a)
of Article 5 could be flexibly interpreted; the “90
days” requirement could be administered flexibly.
Paragraph
1(a)(i)
The term “buying commissions” means fees paid by an importer
to the importer’s agent for the service of representing the importer
abroad in the purchase of the goods being valued.
Paragraph
1(b)(ii)
1.
There are two factors involved in the apportionment of the elements
specified in paragraph 1(b)(ii) of Article 8 to the
imported goods — the value of the element itself and the way in which
that value is to be apportioned to the imported goods. The
apportionment of these elements should be made in a reasonable manner
appropriate to the circumstances and in accordance with generally
accepted accounting principles.
2.
Concerning the value of the element, if the importer acquires the
element from a seller not related to the importer at a given cost, the
value of the element is that cost. If the element was produced
by the importer or by a person related to the importer, its value
would be the cost of producing it. If the element had been
previously used by the importer, regardless of whether it had been
acquired or produced by such importer, the original cost of
acquisition or production would have to be adjusted downward to
reflect its use in order to arrive at the value of the element.
3.
Once a value has been determined for the element, it is necessary to
apportion that value to the imported goods. Various
possibilities exist. For example, the value might be apportioned
to the first shipment if the importer wishes to pay duty on the entire
value at one time. As another example, the importer may request
that the value be apportioned over the number of units produced up to
the time of the first shipment. As a further example, the
importer may request that the value be apportioned over the entire
anticipated production where contracts or firm commitments exist for
that production. The method of apportionment used will depend
upon the documentation provided by the importer.
4.
As an illustration of the above, an importer provides the producer
with a mould to be used in the production of the imported goods and
contracts with the producer to buy 10,000 units. By the time of
arrival of the first shipment of 1,000 units, the producer has already
produced 4,000 units. The importer may request the customs
administration to apportion the value of the mould over 1,000 units,
4,000 units or 10,000 units.
Paragraph
1(b)(iv)
1.
Additions for the elements specified in paragraph 1(b)(iv) of
Article 8 should be based on objective and quantifiable data.
In order to minimize the burden for both the importer and customs
administration in determining the values to be added, data readily
available in the buyer’s commercial record system should be used in so
far as possible.
2.
For those elements supplied by the buyer which were purchased or
leased by the buyer, the addition would be the cost of the purchase or
the lease. No addition shall be made for those elements
available in the public domain, other than the cost of obtaining
copies of them.
3.
The ease with which it may be possible to calculate the values to be
added will depend on a particular firm’s structure and management
practice, as well as its accounting methods.
4.
For example, it is possible that a firm which imports a variety of
products from several countries maintains the records of its design
centre outside the country of importation in such a way as to show
accurately the costs attributable to a given product. In such
cases, a direct adjustment may appropriately be made under the
provisions of Article 8.
5.
In another case, a firm may carry the cost of the design centre
outside the country of importation as a general overhead expense
without allocation to specific products. In this instance, an
appropriate adjustment could be made under the provisions of Article 8
with respect to the imported goods by apportioning total design centre
costs over total production benefiting from the design centre and
adding such apportioned cost on a unit basis to imports.
6. Variations in the above circumstances will, of course, require
different factors to be considered in determining the proper method of
allocation.
7.
In cases where the production of the element in question involves a
number of countries and over a period of time, the adjustment should
be limited to the value actually added to that element outside the
country of importation.
Paragraph
1(c)
1.
The royalties and licence fees referred to in paragraph 1(c) of
Article 8 may include, among other things, payments in respect to
patents, trade marks and copyrights. However, the charges for
the right to reproduce the imported goods in the country of
importation shall not be added to the price actually paid or payable
for the imported goods in determining the customs value.
2.
Payments made by the buyer for the right to distribute or resell the
imported goods shall not be added to the price actually paid or
payable for the imported goods if such payments are not a condition of
the sale for export to the country of importation of the imported
goods.
Paragraph
3
Where objective and quantifiable data do not exist with regard to the
additions required to be made under the provisions of Article 8, the
transaction value cannot be determined under the provisions of Article 1.
As an illustration of this, a royalty is paid on the basis of
the price in a sale in the importing country of a litre of a
particular product that was imported by the kilogram and made up into
a solution after importation. If the royalty is based partially
on the imported goods and partially on other factors which have
nothing to do with the imported goods (such as when the imported goods
are mixed with domestic ingredients and are no longer separately
identifiable, or when the royalty cannot be distinguished from special
financial arrangements between the buyer and the seller), it would be
inappropriate to attempt to make an addition for the royalty.
However, if the amount of this royalty is based only on the imported
goods and can be readily quantified, an addition to the price actually
paid or payable can be made.
For the purposes of Article 9, “time of importation” may
include the time of entry for customs purposes.
1.
Article 11 provides the importer with the right to appeal against a
valuation determination made by the customs administration for the
goods being valued. Appeal may first be to a higher level in the
customs administration, but the importer shall have the right in the
final instance to appeal to the judiciary.
2.
“Without penalty” means that the importer shall not be
subject to a fine or threat of fine merely because the importer chose
to exercise the right of appeal. Payment of normal court costs
and lawyers’ fees shall not be considered to be a fine.
3.
However, nothing in Article 11 shall prevent a Member from requiring
full payment of assessed customs duties prior to an appeal.
Paragraph
4
For the purposes of Article 15, the term “persons” includes
a legal person, where appropriate.
Paragraph
4(e)
For the purposes of this Agreement, one person shall be deemed to
control another when the former is legally or operationally in a
position to exercise restraint or direction over the latter.
Annex
II: Technical
Committee on Customs Valuation back to top
1.
In accordance with Article 18 of this Agreement, the Technical
Committee shall be established under the auspices of the CCC with a
view to ensuring, at the technical level, uniformity in interpretation
and application of this Agreement.
2.
The responsibilities of the Technical Committee shall include the
following:
(a)
to examine specific technical problems arising in the day-to-day
administration of the customs valuation system of Members and to give
advisory opinions on appropriate solutions based upon the facts
presented;
(b)
to study, as requested, valuation laws, procedures and practices as
they relate to this Agreement and to prepare reports on the results of
such studies;
(c)
to prepare and circulate annual reports on the technical aspects of
the operation and status of this Agreement;
(d)
to furnish such information and advice on any matters concerning the
valuation of imported goods for customs purposes as may be requested
by any Member or the Committee. Such information and advice may
take the form of advisory opinions, commentaries or explanatory notes;
(e)
to facilitate, as requested, technical assistance to Members with a
view to furthering the international acceptance of this Agreement;
(f)
to carry out an examination of a matter referred to it by a panel
under Article 19 of this Agreement; and
(g)
to exercise such other responsibilities as the Committee may assign to
it.
General
3.
The Technical Committee shall attempt to conclude its work on specific
matters, especially those referred to it by Members, the Committee or
a panel, in a reasonably short period of time. As provided
in paragraph 4 of Article 19, a panel shall set a specific time
period for receipt of a report of the Technical Committee and the
Technical Committee shall provide its report within that period.
4.
The Technical Committee shall be assisted as appropriate in its
activities by the CCC Secretariat.
Representation
5.
Each Member shall have the right to be represented on the Technical
Committee. Each Member may nominate one delegate and one or more
alternates to be its representatives on the Technical Committee.
Such a Member so represented on the Technical Committee is referred to
in this Annex as a “member of the Technical Committee”.
Representatives of members of the Technical Committee may be assisted
by advisers. The WTO Secretariat may also attend such meetings
with observer status.
6.
Members of the CCC which are not Members of the WTO may be represented
at meetings of the Technical Committee by one delegate and one or more
alternates. Such representatives shall attend meetings of the
Technical Committee as observers.
7.
Subject to the approval of the Chairman of the Technical Committee,
the Secretary-General of the CCC (referred to in this Annex as “the Secretary-General”) may invite representatives of
governments which are neither Members of the WTO nor members of the
CCC and representatives of international governmental and trade
organizations to attend meetings of the Technical Committee as
observers.
8.
Nominations of delegates, alternates and advisers to meetings of the
Technical Committee shall be made to the Secretary-General.
Technical
Committee Meetings
9.
The Technical Committee shall meet as necessary but at least two times
a year. The date of each meeting shall be fixed by the Technical
Committee at its preceding session. The date of the meeting may
be varied either at the request of any member of the Technical
Committee concurred in by a simple majority of the members of the
Technical Committee or, in cases requiring urgent attention, at the
request of the Chairman. Notwithstanding the provisions in
sentence 1 of this paragraph, the Technical Committee shall meet as
necessary to consider matters referred to it by a panel under the
provisions of Article 19 of this Agreement.
10.
The meetings of the Technical Committee shall be held at the
headquarters of the CCC unless otherwise decided.
11.
The Secretary-General shall inform all members of the Technical
Committee and those included under paragraphs 6 and 7 at least 30 days
in advance, except in urgent cases, of the opening date of each
session of the Technical Committee.
Agenda
12.
A provisional agenda for each session shall be drawn up by the
Secretary-General and circulated to the members of the Technical
Committee and to those included under paragraphs 6 and 7 at least 30
days in advance of the session, except in urgent cases. This
agenda shall comprise all items whose inclusion has been approved by
the Technical Committee during its preceding session, all items
included by the Chairman on the Chairman’s own initiative, and all
items whose inclusion has been requested by the Secretary-General, by
the Committee or by any member of the Technical Committee.
13.
The Technical Committee shall determine its agenda at the opening of
each session. During the session the agenda may be altered at
any time by the Technical Committee.
Officers
and Conduct of Business
14.
The Technical Committee shall elect from among the delegates of its
members a Chairman and one or more Vice-Chairmen. The Chairman
and Vice-Chairmen shall each hold office for a period of one year.
The retiring Chairman and Vice-Chairmen are eligible for re-election.
The mandate of a Chairman or Vice-Chairman who no longer represents a
member of the Technical Committee shall terminate automatically.
15.
If the Chairman is absent from any meeting or part thereof, a
Vice-Chairman shall preside. In that event, the latter shall
have the same powers and duties as the Chairman.
16.
The Chairman of the meeting shall participate in the proceedings of
the Technical Committee as such and not as the representative of a
member of the Technical Committee.
17.
In addition to exercising the other powers conferred upon the Chairman
by these rules, the Chairman shall declare the opening and closing of
each meeting, direct the discussion, accord the right to speak, and,
pursuant to these rules, have control of the proceedings. The
Chairman may also call a speaker to order if the speaker’s remarks are
not relevant.
18.
During discussion of any matter a delegation may raise a point of
order. In this event, the Chairman shall immediately state a
ruling. If this ruling is challenged, the Chairman shall submit
it to the meeting for decision and it shall stand unless overruled.
19.
The Secretary-General, or officers of the CCC Secretariat designated
by the Secretary-General, shall perform the secretarial work of
meetings of the Technical Committee.
Quorum
and Voting
20.
Representatives of a simple majority of the members of the Technical
Committee shall constitute a quorum.
21.
Each member of the Technical Committee shall have one vote. A
decision of the Technical Committee shall be taken by a majority
comprising at least two thirds of the members present.
Regardless of the outcome of the vote on a particular matter, the
Technical Committee shall be free to make a full report to the
Committee and to the CCC on that matter indicating the different views
expressed in the relevant discussions. Notwithstanding the above
provisions of this paragraph, on matters referred to it by a panel,
the Technical Committee shall take decisions by consensus. Where
no agreement is reached in the Technical Committee on the question
referred to it by a panel, the Technical Committee shall provide a
report detailing the facts of the matter and indicating the views of
the members.
Languages
and Records
22.
The official languages of the Technical Committee shall be English,
French and Spanish. Speeches or statements made in any of these
three languages shall be immediately translated into the other
official languages unless all delegations agree to dispense with
translation. Speeches or statements made in any other language
shall be translated into English, French and Spanish, subject to the
same conditions, but in that event the delegation concerned shall
provide the translation into English, French or Spanish. Only
English, French and Spanish shall be used for the official documents
of the Technical Committee. Memoranda and correspondence for the
consideration of the Technical Committee must be presented in one of
the official languages.
23.
The Technical Committee shall draw up a report of all its sessions
and, if the Chairman considers it necessary, minutes or summary
records of its meetings. The Chairman or a designee of the
Chairman shall report on the work of the Technical Committee at each
meeting of the Committee and at each meeting of the CCC.
1. The five-year delay in the application of the provisions of the
Agreement by developing country Members provided for in paragraph 1
of Article 20 may, in practice, be insufficient for certain
developing country Members. In such cases a developing country
Member may request before the end of the period referred to in
paragraph 1 of Article 20 an extension of such period, it
being understood that the Members will give sympathetic consideration
to such a request in cases where the developing country Member in
question can show good cause.
2. Developing countries which currently value goods on the basis of
officially established minimum values may wish to make a reservation
to enable them to retain such values on a limited and transitional
basis under such terms and conditions as may be agreed to by the
Members.
3. Developing countries which consider that the reversal of the
sequential order at the request of the importer provided for in
Article 4 of the Agreement may give rise to real difficulties for them
may wish to make a reservation to Article 4 in the following terms:
“The
Government of ............ reserves the right to provide that the
relevant provision of Article 4 of the Agreement shall apply only
when the customs authorities agree to the request to reverse the order
of Articles 5 and 6.”
If
developing countries make such a reservation, the Members shall
consent to it under Article 21 of the Agreement.
4. Developing countries may wish to make a reservation with respect to
paragraph 2 of Article 5 of the Agreement in the following
terms:
“The
Government of ............ reserves the right to provide that
paragraph 2 of Article 5 of the Agreement shall be applied in
accordance with the provisions of the relevant note thereto whether or
not the importer so requests.”
If
developing countries make such a reservation, the Members shall
consent to it under Article 21 of the Agreement.
5. Certain developing countries may have problems in the implementation
of Article 1 of the Agreement insofar as it relates to
importations into their countries by sole agents, sole distributors
and sole concessionaires. If such problems arise in practice in
developing country Members applying the Agreement, a study of this
question shall be made, at the request of such Members, with a view to
finding appropriate solutions.
6. Article 17 recognizes that in applying the Agreement, customs
administrations may need to make enquiries concerning the truth or
accuracy of any statement, document or declaration presented to them
for customs valuation purposes. The Article thus acknowledges
that enquiries may be made which are, for example, aimed at verifying
that the elements of value declared or presented to customs in
connection with a determination of customs value are complete and
correct. Members, subject to their national laws and procedures,
have the right to expect the full cooperation of importers in these
enquiries.
7. The price actually paid or payable includes all payments actually made
or to be made as a condition of sale of the imported goods, by the
buyer to the seller, or by the buyer to a third party to satisfy an
obligation of the seller.
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