Verification and Alternative Valuation Methods
- The Commissioner of Customs may demand further proof if the declared value is doubted.
- Alternative valuation methods if transaction value is uncertain are applied sequentially:
- Transaction value of identical goods.
- Transaction value of similar goods.
- Domestic unit price of goods or similar imported goods.
- Computed value including raw materials cost, profit, expenses, freight, insurance, and related costs.
- If none of the above can determine value, other reasonable methods consistent with GATT 1994 are used.
Publication and Protest of Values
- Commissioner publishes determined values based on diplomatic and other information.
- Values are binding until changed and must be published in widely accessible media.
- Importers or interested parties have 15 days to protest a published value.
- Protest decision must be made and published within 15 days.
Bond Filing for Delayed Determination
- Importers may get goods released by filing a cash bond covering duties and taxes plus 25%.
- Goods prohibited by law cannot be released even with bond.
Definitions of Critical Terms
- "Reasonable doubt" defined as conditions leading to probable cause of an inaccurate invoice value.
- Examples include prices dependent on other sales, extraneous forms of payment, and related party transactions.
- "Related persons" include officers, partners, employer-employee, significant stockholders, controlled entities, and family members.
- "Identical goods" means products identical in physical characteristics, quality, and reputation.
- "Similar goods" share characteristics and materials to perform the same function and are commercially interchangeable.
Transitory Provisions Before Shift to Transaction Value
- Until Congress authorizes full shift to transaction value, valuation is based on export value in principal export markets.
- If export value unknown or doubtful, valuation progresses through markets of manufacture, third countries with similar economic development, and finally domestic wholesale price minus expenses, profits, taxes.
- Similar publication, protest, and bond provisions apply during this period.
Early Shift to Transaction Value
- Congress may mandate earlier shift to transaction value on presidential recommendation for national economy, welfare, or security reasons.
Rules and Delegation
- Secretary of Finance, upon Customs Commissioner’s recommendation, will issue implementing rules.
- Customs Commissioner may delegate duties of value determination and release under bond when no published values exist but must report and establish values promptly.
Hearing and Review of Published Values
- Customs shall create bodies to receive protests and evidence on published values.
- Hearing bodies submit recommendations; commissioner’s decisions are communicated and published.
- Interested parties can petition to raise or lower published values any time during their effectivity.
Repealing Clause and Effectivity
- Inconsistent existing laws and regulations are repealed or modified accordingly.
- The Act takes effect 15 days after publication in official and general circulation media, whichever is earlier.