Content Transportation Charges Airway transport costs Insurance
Loading/handling charges Loading/handling charges not to be
included Duties and taxes applicable outside the country of
importation Other expenses not to be included
Slide 3
Transport Charges The cost of transportation of the goods to
the place of introduction to the customs territory of the country
of importation should be included in the customs value. If the
transport is free of charges or provided by the buyer to the place
of introduction, transport cost should be calculated; the freight
rates normally applied for the same modes of transport serve as the
base. If the costs outside and inside the country are not clearly
divided the cost of transport should be calculated: by deducting
from the price paid, the cost of transport within the customs
territory of the Country of importation, determined on the basis of
the rates normally applied, or by determining the cost of transport
to the place of introduction of the goods into the customs
territory directly on the basis of the rates normally applied. The
goods may have been carried using several different means of
transport.
Slide 4
Airway transport cost Where goods are transported by air on the
same means of transport to a point beyond the place of
introduction, transport costs are to be assessed in proportion to
the distance covered outside and inside the customs territory of
the Country of importation The European Union practice - Air
transport costs to be included in the customs value are set
periodically by the Commission Regulation. Express Mail Services
(EMS) considered as goods transported by air.
Slide 5
In the case of goods imported by post, all postal charges
imposed up to the place of destination, with the exception of
postal charges imposed in the country of importation, are part of
the customs value. Private persons, non-commercial consignments
imported by post postal charges not included in the customs value
In case of doubts (non-commercial or commercial goods?) ask for
more details and proves!
Slide 6
The cost of all insurance effected in relation to the transport
and handling of the goods outside of country of importation must
always be included in the value for customs purposes. In the case
of global insurance a proportionate amount of the premium should be
included in the customs value Costs of insurance to cover risks,
other than risks in transport to the port or place of introduction,
should not be included. Insurance
Slide 7
How to divide the Insurance to outside and inside the country
of importation? (e.g. CIP) If no any reasonable proves whole
insurance to be included in the customs value
Slide 8
Loading and Handling Charges foreign port charges, loading
charges demurrage charges at foreign ports, If the cost of
unloading at the place of introduction can be distinguished on the
relevant documentation it does not form part of the customs value
and may be omitted.
Slide 9
Any weighing costs borne by the importer at destination, not
forming part of the price paid or payable for the goods, are not to
be included. Expenses incurred in connection with the handling or
delivery of goods after their arrival at the place of introduction,
such as port dues or landing charges, are not to be included.
Loading/Handling Charges Not to be included
Slide 10
Duties and Taxes Applicable outside the Country of Importation
Where the imported goods are subject to duties and taxes applicable
outside the Community such duties and taxes are to be included in
the customs value. The cost of these duties and taxes are paid by
the seller and therefore they are part of the price paid or payable
for the goods. Any claim for a reduction in the customs value on
the basis that the goods have been or will be relieved from such
duty/taxes can be allowed. Satisfactory evidence should be
presented!
Slide 11
Other Expenses not to be included charges for construction,
erection, assembly, maintenance or technical assistance, undertaken
after importation of imported goods such as industrial plant,
machinery or equipment; customs duties and other taxes payable in
the Country of importation a charge for the right to reproduce the
imported goods in the Country of importation buying commissions
(fees paid by an importer to an agent for the service of
representing him/her in the purchase of the goods being
imported);
Slide 12
Other Expenses not to be included transport charges after
importation into the customs territory of the Country of
importation charges for interest under a financing arrangement
entered into by the buyer and relating to the purchase of imported
goods provided that: - the financing arrangement has been made in
writing; and - where required, the buyer can demonstrate that: such
goods are actually sold at the price declared as the price actually
paid or payable; and the claimed rate of interest does not exceed
the usual rates in the Country of importation
Slide 13
Questions?
Slide 14
Slide 15
Content General information Combined purchasing Lost or damaged
goods Private importation Hire purchasing Rental agreement Second
hand or used articles Successive sale Sale on consignment Sale on
auction Place of introduction Invoices and payment in foreign
currencies Rate of exchange Fixed Rates
Slide 16
The majority of consignments will be be valued by the
transaction value method + Commissions, cost of containers,
packaging, assists, royalties & licenses, processed of
resale,transpiration, insurance, outside duties, loading, handling
- Transportation after importation, assembly after importation,
buying commission, in-land duties General info Price paidSaleSale
for export Price actually paid or payable No exclusions
Slide 17
Combined Purchasing Combined purchasing occurs where a large
consignment of goods is purchased in a single transaction. If a
quantity of that consignment is then declared for free circulation
into the Country of importation, the value for that quantity by the
ratio to the proportion of the total price and quantity
purchased.
Slide 18
Lost or Damaged Goods If a part of consignment was lost or
damaged, the apportionment of the price actually paid or payable is
permitted if: Goods were lost/damaged before their release into
free circulation It must be irretrievable loss of goods -they can
not be used by anyone, therefore no stolen goods, which may
continue to be used
Slide 19
The price was reduced based on commitment in the purchase
agreement prior to the release of goods for free circulation (for
example, exposing a new invoice or credit note) Damages are not
already reflected in the relevant contract of sale ( e.g. imported
fresh fruit includes in the certain percentage that can be
damaged/spoiled during transport) the price adjustment made later
than 12 months from the date of release of the goods into free
circulation is not acceptable. This point in time must be
established in an appropriate form ( e.g. by a corresponding
agreement between buyer and seller ). The credit note document is,
however, insufficient as the proof ( can be supported e.g. by bank
statement, proof of payment ).
Slide 20
In case that goods are insured against damages, the customs
office may take into account a discount from the seller or price of
damaged goods designated by insurance company or other authorized
body. the customs value of the goods that came with shortcomings or
defects, or which does not correspond to the order or agreement
(other goods, design, color, size,) can be reduced on the basis of
discounts provided by the seller (a new invoice or credit note with
a reduced price), which can become the basis for the calculation or
recalculation of the customs value.
Slide 21
Example Importer ordered trousers of certain sizes. At the time
of importation (or after at the time of unpacking) it was found
that trousers have been delivered only in extra large numbers,
which are difficult to sold. The buyer received 50% discount;
seller issued credit note that may be used as a basis for reduced
customs value (Credit not to be accompanied by a bank statement and
proof of payment).
Slide 22
Private Importations In the case of goods imported for the
private use of the importer and not for sale, whether imported in
accompanied baggage or otherwise, the customs value is established
using the normal customs valuation methods
Slide 23
Hire Purchase hire purchase contracts, ownership of the goods
passes automatically to the hirer once all the payments specified
in the contract have been met. When goods are sold on certain hire
purchase contracts, ownership of the goods passes automatically to
the hirer once all the payments specified in the contract have been
met. This should be treated as a contract of sale. Where the
interest is clearly marked it should be excluded from the customs
value Certain hire or leasing contracts include an option to
purchase the goods. When such an option is exercised before the
material time for customs purposes the price actually paid or
payable under the option may be used to determine the customs
value. Otherwise, the customs value is to be determined by
proceeding sequentially through the alternative valuation
methods.
Slide 24
Rental Agreements The alternative methods of valuation to the
transaction value method are to be applied to goods imported under
a rental agreement.
Slide 25
Second-Hand or Used Articles Where second-hand or used articles
are the subject of a sale, and the conditions for transaction value
are satisfied, that method of valuation is to be applied whether
the goods are imported as commercial or for private use. In
circumstances where no sale price exists, the transaction valuation
method cannot be used Also, where the article is imported by a
person in whose possession and use it has been for an appreciable
period prior to importation, the transaction valuation method
cannot be used. The value is to be determined by proceeding
sequentially through the alternative valuation methods.
Slide 26
Successive Sales This applies where goods have been the subject
of a number of sales prior to importation. In such cases, the last
sale occurring in the commercial chain prior to the introduction of
the goods into the customs territory of the Country of importation
is to be considered as the sales price for customs valuation
purposes Alternatively, a sale taking place in the customs
territory of the Community before entry for free circulation of the
goods can be considered the sales price for customs valuation
purposes.
Slide 27
However, where the valuation declared is based on an earlier
sale, that may be accepted as the basis for valuation only if it
can be demonstrated that the transaction in question involved the
sale of goods for export to the Country of importation Proves that
may demonstrate that the goods were sold for export to the Country
of importation: the goods are manufactured according to Community
specifications or are identified, according to the marks they bear,
as having no other use or destination; or the goods were
manufactured or produced specifically for a buyer in the Country of
importation, or specific goods are ordered from an intermediary but
are shipped directly to the Country of importation from the
manufacturer.
Slide 28
Goods Imported for Sale on Consignment Trading arrangement in
which a seller sends goods to a buyer or reseller who pays the
seller only as and when the goods are sold. The seller remains the
owner (title holder) of the goods until they are paid for in full
and, after a certain period, takes back the unsold goods. Also
called sale or return, or goods on consignment. These goods are
exported to the Country of importation for sale at the best price
obtainable for the consignor in the country of exportation. Due to
the absence of a price paid or payable the customs value must be
established by proceeding sequentially through the alternative
valuation methods
Slide 29
Goods Imported for Sale by Auction In the case of importation
of goods (paintings, artefacts, cars and other articles) imported
for sale by auction, the normal valuation rules apply. Due to the
absence of a price paid or payable, the customs value be
established by proceeding sequentially through the alternative
valuation methods.
Slide 30
Place of Introduction Standard Place of Introduction For the
purposes of establishing the transport, handling and insurance
charges to be included in the customs value, the place of
introduction should be established: for goods carried by sea, the
port of unloading, or the port of transshipment certified by the
customs authorities as the port of introduction; for goods carried
by rail or road, the place where the first customs office of the
country of importation is situated; for goods carried by air, the
place where the land frontier of the customs territory of the
Country of importation is crossed.
Slide 31
goods may be introduced into the customs territory of the
Country of importation then carried by sea to a destination in
another part of that territory. In these circumstances, the customs
value should be determined by reference to the first place of
introduction into the customs territory of the Community.
Slide 32
Invoices and Payments in Foreign Currencies Where factors used
to determine the value of goods for customs purposes are expressed
in a currency other than the Euro, the rate of exchange to be used
is the periodic rate established in accordance with the customs
legislation of the country of importation; In the EU: Articles 168
to 172 of the Customs Code Implementing Provisions (CCIP). reflect
effectively the current value of currencies in commercial
transactions; - are published by the competent authorities of the
Member States; and - apply during a fixed period. - The significant
features of the provisions are that rates of exchange used in
determining the customs value are fixed monthly and if no
significant fluctuation on the exchange markets affects them (
Article 171(1)), they remain unchanged for a month, and that a
special provision exists with regard to establishing exchange rates
to be used with periodic declarations. Insofar as the rates of
exchange are fixed as much as fourteen days before they enter into
use and normally apply unchanged for one month, the rules
facilitate the operation of simplified entry procedures.
Slide 33
Establishing the Rate of Exchange The rates of exchange quoted
by the Central Bank on the second last Wednesday of each month are
used for customs valuation purposes for the following calendar
month. Tolerance limit (5% above or below); In cases where the
tolerance limits are exceeded, the revised rates and operative
dates will be posted
Slide 34
Publication of Rates of Exchange Details of the rates to be
applied in a particular calendar month are posted by the state
authorities This list of periodic rates of exchange is to be
displayed for the information of the public in offices where
Customs entries are presented.
Slide 35
Payment Made At Fixed Rate Of Exchange An invoice may be made
out in Euro but indicates that payment is to be made in foreign
currency at a fixed rate of exchange with a specific declaration to
that effect being made on the entry. In case that customs are
satisfied as to the bona fide of the transaction, the calculation
can be made. This will be done by converting the national currency
into foreign currency at the fixed rate of exchange and re-
converting the resulting figure into national currency as indicated
in the customs legislation.
Slide 36
Valuation Rules for Specific Customs Procedures Specific
provisions exist relating to certain customs procedures where goods
are released for free circulation after being assigned a different
treatment or use, for example Inward Processing.
Slide 37
Slide 38
Content Customs warehousing Inward processing Outward
processing Release of goods in advance Declaration of customs
value
Slide 39
Type D & E Warehouses ( private customs warehouses, which
means that only the administrator /warehouse keeper is allowed to
store goods in them) Value established at time when the goods were
placed under the customs warehousing arrangements, the value of the
goods at that time should be applied. However, upon the importer
request, the value at the time of release for free circulation may
be accepted. Valuation Customs Warehousing
Slide 40
Other Types: The value to be taken is the value determined at
the time the goods were released for free circulation. The costs of
warehousing and of preserving goods while they remain in the
warehouse need not be included in the customs value if they are
shown separately from the price actually paid or payable for the
goods. Paragraph 7.8 concerning successive sales may be applied
when goods are being entered for the warehousing procedure or at
the time the goods are being released for free circulation, as
appropriate
Slide 41
the suspension system or the drawback system. If a product was
sold on the customs territory of the Country of importation, the
customs value is usually determinate by transaction method; No sale
alternative methods A customs debt related to imported goods : -
incorporated in processed products that were released into the free
circulation in the country of importation - Goods that did not
undergo processing operation in the country of importation -
Valuation based on the price of goods declared at the time of their
entry into the inward procedure, - exception - location of the
compensating products in a free zone or free warehouse where the
customs debt is calculated according to relevant provisions -
Processing costs means all costs incurred in the production of
processed products Inward Processing
Slide 42
Outward Processing Based on commercial contracts - procedure or
adjustment or reparation of goods according to owner requirements
and for its own account outside of the country where the owner of
goods is based the cost of processing / adjustment or reparation of
the goods imported back to the customs territory is considered as
base for valuation If the goods contain goods from imported to the
country of processing from the third country, these are considered
as the part of the customs value The additions to the customs value
to be included (transportation, insurance handling...)
Slide 43
Release of Goods in Advance of Final Determination on Value
Where doubts exist as to the accuracy of declared valuation,
release of goods should only be refused or unduly delayed in the
most exceptional circumstances (e.g. suspicion of fraudulent
activity). In normal circumstances, goods should be released on
provision of a suitable. In this context, it is paramount that the
level of security/deposit taken should be sufficient to cover the
potential duty at risk.
Slide 44
Customs Value Declaration Subject to certain exemptions, all
consignments in excess of 10,000 require the production, with the
relevant customs entry, of a declaration of particulars relating to
the customs value of the goods being imported. The declaration is
used where there is a price actually paid or payable. Where
appropriate, this form may be supplemented by one or more
continuation sheets
Slide 45
Where, exceptionally, there is no price actually paid or
payable, the requirement for a customs value declaration form may
be not claim and an appropriate declaration, supported by
documentary evidence, should be made on the entry It should be
noted that the special declaration on the entry is only appropriate
in cases where the transaction value method is not available at the
time of entry and a price will not be available in the future. It
should NOT be used in cases where goods are cleared on security of
duties, pending production of satisfactory evidence of value, and a
price will be available for declaration to Customs later. Such
cases should continue to be dealt with in accordance with paragraph
13 relating to release of goods in advance of determination of the
amount of duty payable.