WTO Customs Valuation Agreement. Why an Agreement on customs valuation?. customs valuation and ad valorem customs duties Article VII of GATT 1947 The Tokyo Round Code The WTO Agreement on Implementation of Article VII of GATT 1994 (Customs Valuation Agreement). What does the Agreement do?.
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--transaction value of identical goods
--transaction value of similar goods
Price actually paid or payable for the goods when sold for export to the country of importation adjusted in accordance with the provisions of Article 8 of the Agreement
1 - no restriction on the disposition or use of the goods by the buyer, other than
--imposed or required by law or public authorities in the country of importation
--limiting the geographical area in which the goods may be resold do not substantially affect the value of the goods
2 - no part of the proceeds will accrue to the seller, unless adjustment is made
3 - sale or price not subject to some condition or consideration for which a value cannot be determined for the goods being valued
4 - buyer and seller not related or if related, transaction value acceptable for customs
--if relationship did not affect the price, or
--when importer demonstrates that the value closely approximates a “test value”
1. Transaction value of identical goods
2. Transaction value of similar goods
--the goods must be sold to the same country of importation as the goods being valued
--the goods must be exported at or about the same times as the goods being valued
- Deductive value
- Computed value
the importer has the right to choose the order of application of the two methods
-selling price of goods in country of importation
-higher of two alternative values
-price of goods on domestic market of exporting country
-cost of production other than computed values for identical or similar goods
-price of goods for export to a third country
-minimum customs value
-arbitrary or fictitious values
Five year delayed implementation for developing countries not parties to the Tokyo Round Code
Three years for the application of the computed value method
-Possibility of a reservation to retain minimum values on a limited and transitional basis
-Possibility of a reservation regarding the right of the importer to choose between deducted and computed value
-Reservation with respect to certain aspects of using the deductive valuation method
56 Developing Countries originally requested the 5-year delay period (Art. 20.1)
An additional 24 have not notified the delay, nor legislation.
With respect to Computed values
With respect to Minimum values
With respect to the right of the importer to choose between deducted and computed value
With respect to certain aspects of using the deductive valuation method
1. It is reaffirmed that transaction value is the primary basis of valuation under the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade (the Agreement) and that its application with regard to data or instructions (software) recorded on carrier media for data processing equipment is fully consistent with the Agreement.
2. Given the unique situation with regard to data or instructions (software) recorded on carrier media for data processing equipment, and that some Parties have sought a different approach, it would also be consistent with the Agreement for those Parties which wish to do so to adopt the following practice:
3. Those Parties adopting the practice referred to in paragraph 2 of this Decision shall notify the Committee of the date of its application.
4. Those Parties adopting the practice in paragraph 2 of this Decision will do so on a most-favoured-nation (m.f.n.) basis, without prejudice to the continued use by any Party of the transaction value practice.
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