Valuation
Implementing Regulation
CHAPTER 2
Value of goods for customs purposes
Article 71
Simplification
(Article 73 of the Code)
1. The authorisation referred to in Article 73 of the Code may be granted where the following conditions are met:
(a)
the application of the procedure referred to in Article 166 of the Code would, in the circumstances, represent disproportioned administrative costs;
(b)
the customs value determined, will not significantly differ from that determined in the absence of an authorisation.
2. The grant of the authorisation is conditional to the fulfilment, by the applicant, of the following conditions:
(a)
he complies with the criterion laid down in Article 39(a) of the Code;
(b)
he maintains an accounting system which is consistent with the generally accepted accounting principles applied in the Member State where the accounts are held and which will facilitate audit-based customs control. The accounting system shall maintain a historical record of data that provides an audit trail from the moment the data enters the file;
(c)
he has an administrative organisation which corresponds to the type and size of business and which is suitable for the management of the flow of goods, and have internal controls capable of detecting illegal or irregular transactions;
CHAPTER 3
Value of goods for customs purposes
Article 127
General provisions
(Article 70(3)(d) of the Code)
1. For the purposes of this Chapter, two persons shall be deemed to be related if one of the following conditions is fulfilled:
(a)
they are officers or directors of the other person’s business;
(b)
they are legally recognised partners in business;
(c)
they are employer and employee;
(d)
a third party directly or indirectly owns or controls or holds 5% or more of the outstanding voting stock or shares of both of them;
(e)
one of them directly or indirectly controls the other;
(f)
both of them are directly or indirectly controlled by a third person;
(g)
together they control a third person directly or indirectly;
(h)
they are members of the same family.
2. Persons who are associated in business with one another in that one is the sole agent, sole distributor or sole concessionaire, however described, of the other shall be deemed to be related only if they fall within the criteria referred to in paragraph 1.
3. For the purposes of paragraph 1(e),(f) and (g) one person is deemed to control another when the former is legally or operationally in a position to exercise direction over the latter.
Article 128
Transaction value
(Article 70(1) of the Code)
1. The transaction value of the goods sold for export to the customs territory of the Union shall be determined at the time of acceptance of the customs declaration on the basis of the sale occurring immediately before the goods were brought into that customs territory.
2. Where the goods are sold for export to the customs territory of the Union not before they were brought into that customs territory but while in temporary storage or while placed under a special procedure other than internal transit, end-use or outward processing, the transaction value will be determined on the basis of that sale.
Article 129
Price actually paid or payable
(Article 70(1) and (2) of the Code)
1. The price actually paid or payable within the meaning of Article 70(1) and (2) of the Code shall include all payments made or to be made as a condition of sale of the imported goods by the buyer to any of the following persons:
(a)
the seller;
(b)
a third party for the benefit of the seller;
(c)
a third party related to the seller;
(d)
a third party where the payment to that party is made in order to satisfy an obligation of the seller.
Payments may be made by way of letters of credit or negotiable instruments, and payments may be made directly or indirectly.
2. Activities, including marketing activities, undertaken by the buyer or an undertaking related to the buyer on his or its own account, other than those for which an adjustment is provided in Article 71 of the Code, shall not be considered an indirect payment to the seller.
Article 130
Discounts
(Article 70(1) and (2) of the Code)
1. For the purposes of determining the customs value under Article 70(1) of the Code, discounts shall be taken into account if, at the time of acceptance of the customs declaration, the sales contract provides for their application and their amount.
2. Discounts for early payment shall be taken into account with regard to goods for which the price has not actually been paid at the time of acceptance of the customs declaration.
3. Discounts arising from amendments to the contract subsequent to the time of acceptance of the customs declaration shall not be taken into account.
Article 131
Partial delivery
(Article 70(1) of the Code)
1. Where goods declared for a customs procedure are part of a larger quantity of the same goods purchased in one transaction, the price actually paid or payable shall, for the purposes of Article 70(1) of the Code, be calculated pro rata on the basis of the price for the total quantity purchased.
2. Apportioning the price actually paid or payable shall also apply in the case of the loss of part of a consignment or when the goods have been damaged before the goods are released for free circulation.
Article 132
Price adjustments for defective goods
(Article 70(1) of the Code)
An adjustment made by the seller, to the benefit of the buyer, of the price actually paid or payable for the goods may be taken into consideration for the determination of the customs value in accordance with Article 70(1) of the Code, if the following conditions are fulfilled:
(a)
the goods were defective at the time of acceptance of the customs declaration for release for free circulation;
(b)
the seller made the adjustment to compensate for the defect in order to fulfil either of the following:
(i)
a contractual obligation entered into before the acceptance of the customs declaration;
(ii)
a statutory obligation applicable to the goods;
(c)
the adjustment is made within a period of 1 year following the date of acceptance of the customs declaration.
Article 133
Valuation of conditions and considerations
(Article 70(3)(b) of the Code)
Where the sale or price of imported goods is subject to a condition or consideration the value of which can be determined with respect to the goods being valued, such value shall be regarded as part of the price actually paid or payable, unless those conditions or considerations relate to either of the following:
(a)
an activity to which Article 129(2) of this Regulation applies;
(b)
an element of the customs value under Article 71 of the Code.
Article 134
Transactions between related persons
(Article 70(3)(d) of the Code)
1. Where the buyer and the seller are related, and in order to determine whether such relationship did not influence the price, the circumstances surrounding the sale shall be examined as may be necessary, and the declarant shall be given an opportunity to supply further detailed information as may be necessary about those circumstances.
2. However, the goods shall be valued in accordance with Article 70(1) of the Code where the declarant demonstrates that the declared transaction value closely approximates to one of the following test values, determined at or about the same time:
(a)
the transaction value in sales, between buyers and sellers who are not related in any particular case, of identical or similar goods for export to the customs territory of the Union;
(b)
the customs value of identical or similar goods, determined in accordance with Article 74(2)(c) of the Code;
(c)
the customs value of identical or similar goods, determined in accordance with Article 74(2)(d) of the Code.
3. When establishing the value of identical or similar goods referred to in paragraph 2, account shall be taken of the following elements:
(a)
demonstrated differences in commercial levels;
(b)
quantity levels;
(c)
the elements listed in Article 71(1) of the Code;
(d)
costs incurred by the seller in sales in which he and the buyer are not related, where such costs are not incurred by the seller in sales between related persons.
4. The test values listed in paragraph 2 are to be used at the request of the declarant. They shall not substitute for the declared transaction value.
Article 135
Goods and services used for the production of the imported goods
(Article 71(1)(b) of the Code)
1. Where a buyer supplies any of the goods or services listed in Article 71(1)(b) of the Code to the seller, the value of those goods and services shall be deemed to be equal to their purchasing price. The purchasing price shall include all the payments which the buyer of the goods or services listed in Article 71(1)(b) is required to make to acquire the goods or services.
Where those goods or services were produced by the buyer or a person related to him, their value shall be the cost of producing them.
2. Where the value of the goods and services listed in Article 71(1)(b) of the Code cannot be determined in accordance with paragraph 1, it shall be determined on the basis of other objective and quantifiable data.
3. Where the goods listed in Article 71(1)(b) of the Code have been used by the buyer before they were supplied, their value shall be adjusted to take account of any depreciation.
4. The value of the services referred to in Article 71(1)(b) of the Code, shall include the costs of unsuccessful development activities insofar as those were incurred in respect of projects or orders relating to the imported goods.
5. For the purposes of Article 71(1)(b)(iv) of the Code, the costs of research and preliminary design sketches shall not be included in the customs value.
6. The value of the goods and services supplied, as established in accordance with paragraphs 1 to 5 shall be apportioned pro rata over the imported goods.
Article 136
Royalties and licence fees
(Article 71(1)(c) of the Code)
1. Royalties and licence fees are related to the imported goods where in particular, the rights transferred under the licence or royalties agreement are embodied in the goods. The method of calculation of the amount of the royalty or licence fee is not the decisive factor.
2. Where the method of calculation of the amount of royalties or licence fees derives from the price of the imported goods, it shall in the absence of evidence to the contrary be assumed that the payment of those royalties or licence fees is related to the goods to be valued.
3. If royalties or licence fees relate partly to the goods being valued and partly to other ingredients or component parts added to the goods after their importation, or to post-importation activities or services, an appropriate adjustment shall be made.
4. Royalties and licence fees are considered to be paid as a condition of sale for the imported goods when any of the following conditions is met:
(a)
the seller or a person related to the seller requires the buyer to make this payment;
(b)
the payment by the buyer is made to satisfy an obligation of the seller, in accordance with contractual obligations;
(c)
the goods cannot be sold to, or purchased by, the buyer without payment of the royalties or license fees to a licensor.
5. The country in which the recipient of the royalties or licence fees payment is established is not a material consideration.
Article 137
Place where goods are brought into the customs territory of the Union
(Article 71(1)(e) of the Code)
1. For the purposes of Article 71(1)(e) of the Code, the place where goods are brought into the customs territory of the Union shall be:
(a)
for goods carried by sea, the port where the goods arrive first in the customs territory of the Union;
(b)
for goods carried by sea into one of the French overseas departments which are part of the customs territory of the Union, and carried directly to another part of the customs territory of the Union, or vice versa, the port where the goods arrive first in the customs territory of the Union, provided that they were unloaded or transhipped there;
(c)
for goods carried by sea and then, without transhipment, by inland waterway, the first port where unloading can take place;
(d)
for goods carried by rail, inland waterway, or road, the place where the customs office of entry is situated;
(e)
for goods carried by other modes of transport, the place where the frontier of the customs territory of the Union is crossed.
2. For the purposes of Article 71(1)(e) of the Code, where the goods are brought into the customs territory of the Union and then carried to a destination in another part of that territory through territories outside of the customs territory of the Union, the place where the goods are brought into the customs territory of the Union shall be the place where goods were first brought into that customs territory, provided that the goods are carried directly through those territories by a usual route to the place of destination.
3. Paragraph 2 shall also apply where the goods have been unloaded, transhipped or temporarily immobilised in territories outside of the customs territory of the Union for reasons relating solely to their transport.
4. Where the conditions laid down in paragraphs 1(b), 2 and 3 are not fulfilled, the place where goods are brought into the customs territory of the Union shall be the following:
(a)
for goods carried by sea, the port of unloading;
(b)
for goods carried by other means of transport the place specified in points (c), (d) or (e) of paragraph 1 situated in that part of the customs territory of the Union to which the goods are consigned.
Article 138
Transport costs
(Article 71(1)(e) of the Code)
1. Where goods are carried by the same means of transport to a point beyond the place where they are brought into the customs territory of the Union, transport costs shall be assessed in proportion to the distance to the place where the goods are brought into the customs territory of the Union in accordance with Article 137 of this Regulation, unless evidence is produced to the customs authorities to show the costs that would have been incurred under a standard schedule of freight rates for the carriage of the goods to the place where goods are brought into the customs territory of the Union.
2. Air transport costs, including air express delivery costs, to be included in the customs value of goods shall be determined in accordance with Annex 23-01.
3. Where transport is free of charge or provided by the buyer, the transport costs to be included in the customs value of the goods shall be calculated in accordance with the schedule of freight rates normally applied for the same modes of transport.
Article 139
Charges levied on postal consignments
(Article 70(1) of the Code)
Postal charges levied up to the place of destination in respect of goods sent by post shall be included in the customs value of these goods, with the exception of any supplementary postal charge levied in the customs territory of the Union.
Article 140
Non-acceptance of declared transaction values
(Article 70(1) of the Code)
1. Where the customs authorities have reasonable doubts that the declared transaction value represents the total amount paid or payable as referred to in Article 70(1) of the Code, they may ask the declarant to supply additional information.
2. If their doubts are not dispelled, the customs authorities may decide that the value of the goods cannot be determined in accordance with Article 70(1) of the Code.
Article 141
Customs value of identical or similar goods
(Article 74(2)(a) and (b) of the Code)
1. When determining the customs value of imported goods in accordance with Article 74(2)(a) or (b) of of the Code, the transaction value of identical or similar goods in a sale at the same commercial level and in substantially the same quantities as the goods being valued shall be used.
Where no such sale is found, the customs value shall be determined having regard to the transaction value of identical or similar goods sold at a different commercial level or in different quantities. This transaction value should be adjusted to take account of differences attributable to commercial level and/or quantity.
2. An adjustment shall be made to take account of significant differences in costs and charges between the imported goods and the identical or similar goods in question due to differences in distances and modes of transport.
3. Where more than one transaction value of identical or similar goods is found, the lowest of those values shall be used to determine the customs value of the imported goods.
4. ‘Identical goods’ and ‘similar goods’, as the case may be, do not include goods which incorporate or reflect engineering, development, artwork, design work, plans or sketches for which no adjustment has been made under Article 71(1)(b)(iv) of the Code because such work was undertaken in the Union.
5. A transaction value for goods produced by a different person is to be taken into account only when no transaction value can be found for identical or similar goods produced by the person who produced the goods being valued.
Article 142
Deductive method
(Article 74(2)(c) of the Code)
1. The unit price used to determine the customs value under Article 74(2)(c) of the Code shall be the price at which the imported goods or imported identical or similar goods are sold in the Union, in the condition as imported, at or about the time of importation of the goods being valued.
2. In the absence of a unit price as referred to in paragraph 1, the unit price used shall be the price at which the imported goods or imported identical or similar goods are sold in the conditions as imported in the customs territory of the Union at the earliest time after the importation of the goods to be valued and in any case within 90 days of that importation.
3. In the absence of a unit price as referred either to paragraphs 1 and 2, at the request of the declarant the unit price at which the imported goods are sold in the customs territory of the Union after further working or processing shall be used, due allowance being made for the value added by such working or processing.
4. The following sales shall not be taken into account for the purposes of determining the customs value under Article 74(2)(c) of the Code:
(a)
sales of goods at a commercial level other than the first after importation;
(b)
sales to related persons;
(c)
sales to persons who directly or indirectly supply, free of charge or at reduced cost, the goods or services listed in Article 71(1)(b) of the Code for use in connection with the production and sale for export of the imported goods;
(d)
sales in quantities which are not sufficient to allow the unit price to be determined.
5. When determining the customs value, the following shall be deducted from the unit price determined in accordance with paragraphs 1 to 4:
(a)
either the commissions usually paid or agreed to be paid or the additions usually made for profit and general expenses (including the direct and indirect costs of marketing the goods in question) in connection with sales in the customs territory of the Union of imported goods of the same class or kind which are goods that fall within a group or range of goods produced by a particular industrial sector;
(b)
usual costs of transport and insurance and associated costs incurred within the customs territory of the Union;
(c)
import duties and other charges payable in the customs territory of the Union by reason of the import or sale of the goods.
6. The customs value of certain perishable goods as referred to in Annex 23-02 imported on consignment may be directly determined in accordance with Article 74(2)(c) of the Code. For this purpose the unit prices shall be notified to the Commission by the Member States and disseminated by the Commission via TARIC in accordance with Article 6 of Council Regulation (EEC) No 2658/87 (16).
Such unit prices may be used to determine the customs value of the imported goods for periods of 14 days. Each period shall start on a Friday.
The unit prices shall be calculated and notified as follows:
(a)
after the deductions provided for in paragraph 5 unit price per 100 kg net for each category of goods shall be notified by the Member States to the Commission. Member States may fix standard amounts for the costs referred to point (b) of paragraph 5, which shall be made known to the Commission;
(b)
the reference period for determining unit prices shall be the preceding period of 14 days which ends on the Thursday preceding the week during which new unit prices are to be established;
(c)
Member States shall notify the unit prices in euro to the Commission not later than 12.00 on the Monday of the week in which they are to be disseminated by the Commission. Where that day is not a working day, notification shall be made on the working day immediately preceding that day. Unit prices shall only apply if this notification is disseminated by the Commission.
Article 143
Computed Value method
(Article 74(2)(d) of the Code)
1. In applying Article 74(2)(d) of the Code, the customs authorities may not require or compel any person not established in the customs territory of the Union to produce for examination, or to allow access to, any account or other record for the purposes of determining the customs value.
2. The cost or value of materials and fabrication referred to in Article 74(2)(d)(i) of the Code shall include the cost of elements specified in Article 71(1)(a) (ii) and (iii) of the Code. It shall also include the apportioned cost of any product or service specified in Article 71(1)(b) of the Code which has been supplied directly or indirectly by the buyer for use in connection with the production of the goods being valued. The value of elements specified in Article 71(1)(b)(iv) of the Code which are undertaken in the Union shall be included only to the extent that those elements are charged to the producer.
3. The cost of production includes all expenditure incurred in creating, adding to or substantially enhancing economic goods. It also includes the costs specified in Article 71(1)(b)(ii) and (iii) of the Code.
4. The general expenses referred to in Article 74(2)(d)(ii) of the Code, cover the direct and indirect costs of producing and selling the goods for export which are not included under Article 74(2)(d)(i) of the Code.
Article 144
Fall-back method
(Article 74(3) of the Code)
1. When determining the customs value under Article 74(3) of the Code, reasonable flexibility may be used in the application of the methods provided for in Articles 70 and 74(2) of the Code. The value so determined shall, to the greatest extent possible, be based on previously determined customs values.
2. Where no customs value can be determined under paragraph 1, other appropriate methods shall be used. In this case the customs value shall not be determined on the basis of any of the following:
(a)
the selling price within the customs territory of the Union of goods produced in the customs territory of the Union;
(b)
a system whereby the higher of two alternative values is used for customs valuation;
(c)
the price of goods on the domestic market of the country of exportation;
(d)
the cost of production, other than computed values which have been determined for identical or similar goods under Article 74(2)(d) of the Code;
(e)
prices for export to a third country;
(f)
minimum customs values;
(g)
arbitrary or fictitious values.
Article 145
Supporting documents regarding customs value
(Article 163(1) of the Code)
The invoice which relates to the declared transaction value is required as a supporting document.
Article 146
Currency conversion for customs valuation purposes
(Article 53(1)(a) of the Code)
1. In accordance with Article 53(1)(a) of the Code, the following rates of exchange shall be used for currency conversion for customs valuation purposes:
(a)
the rate of exchange published by the European Central Bank, for the Member States whose currency is the euro;
(b)
the rate of exchange published by the competent national authority or, where the national authority has designated a private bank for the purposes of publishing the rate of exchange, the rate published by that private bank, for the Member States whose currency is not the euro.
2. The rate of exchange to be used in accordance with paragraph 1 shall be the rate of exchange published on the second last Wednesday of each month.
Where no rate of exchange has been published on that day, the most recently published rate shall apply.
3. The rate of exchange shall apply for a month, beginning on the first day of the following month.
4. Where a rate of exchange has not been published as referred to in paragraphs 1 and 2, the rate to be used for the application of Article 53(1)(a) of the Code shall be determined by the Member State concerned. This rate must reflect the value of the currency of the Member State concerned as closely as possible.