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Customs authorities have a right to use every following method of assessment of customs value of goods if this value may not be assessed through the implementation of the previous method. In addition to that, customs authorities are obliged to prove the impossibility of implementation of every previous method, including impossibility of recognition of customs value presented by the declarant

08 November, 2012 Newsletters

On September 11, 2012 the Supreme Court of Ukraine adopted the Resolution which again confirmed that application of each next method of customs value assessment by the customs authorities without providing any evidences that the customs value cannot be determined by application of the previous method is unlawful (for instance, the Resolution of January 21, 2011 in the case N 21-56а10, of February 7, 2011 in the case N 21-76а10, of November 14, 2011 in Case N 21-213а11, of February 6, 2012 in Case N 21-418а11).

Thus, the Supreme Court of Ukraine in Resolution of September 11, 2012 states the following:

“… each following method is used if the customs value of goods cannot be assessed through application of the previous method… by using the third method of customs value assessment the Customs has not substantiated impossibility of use of the first method of customs value assessment with reference to documents given by customs applicant. Non-provision of the documents of the declarant requested by the customs authorities is not considered to be sufficient to prove the necessity to apply the other method of customs value assessment“.

The abovementioned court practice confirms that customs authorities have the right to use each following method of customs value assessment of goods if this value cannot be assessed by the previous method. At the same time the customs authorities in the decision on assessment of customs value of goods are obliged to prove that it is impossible to apply every previous method including impossibility to use the customs value of the declarant.

It should be mentioned that the said court practice concerns the application of the Customs Code of Ukraine which has been effective before the New Customs Code of Ukraine came into force on March 13, 2012. At the same time the above conclusions of the Supreme Court are still actual for implementation of the new legislation as well.

Thus, in pursuance to Article 52 of the new Customs Code of Ukraine, the main method of customs value assessment of goods which are imported to the customs territory of Ukraine according to the customs import procedure is the first method, i.e. according to the contractual price (transaction value). Every next method shall be applied only if the customs value of goods cannot be assessed by the application of the previous method according to the rules of this Code.

According to Article 55 of the Customs Code of Ukraine the written decision adopted by the customs authorities on adjustment of the provided customs value of goods shall contain, inter alia, substantiation of reasons why the customs value of the declarant cannot be accepted, the grounds for the value of goods as adjusted by customs authorities and the facts which have influenced such adjustment.

The respective section is also provided in the form of Resolution on adjustment of customs value of goods approved by the Order No. 598 of the Ministry of Finance of Ukraine dated May 24, 2012. In particular, paragraph 33 of the Resolution “The circumstances of decision making and the sources of information used by the customs authorities for customs value assessment”, inter alia, “the sequence of methods implementation is indicated and reasons why every previous method was not used by customs authority”.

The above commentary presents the general statement for information purposes only and as such may not be practically used in specific cases without professional advice.

Kind regards,

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