U.S. Customs and Border Protection (CBP) has been looking more closely at valuation on the entry of imported goods. CBP published an Informed Compliance Publication on ‘Determining Customs Value of Fresh Produce’ which provides an overview on the different means of appraisement used in determining ’Customs value’.
The methods of appraisement are sequential, with transaction value being the preferred method, but transaction value is not always able to be used (for example, when goods are not sold, or are imported on consignment). Also note that for related party transactions, two tests must be passed (circumstances of sale, and test values) to enable transaction value to be used.
Where transaction value is not allowed, the following sequential methods of appraisement are used:
- Transaction value of identical merchandise
- The transaction value of similar merchandise
- Deductive value
- Computed value
- Value if other value cannot be used (Fallback method)
An importer must use reasonable care when determining ‘Customs value’ and know what additions or deductions may be taken. Livingston provides a service available to assist importers on valuation issues.
Please contact your Livingston Account Manager with questions, or if interested in engaging the services of our Consulting Group.