Conditions for use of Transaction Value
- are imposed or required by law
- are limited to the geographical area in which the goods may be resold
- do not substantially affect the value of the goods
- Condition One
Evidence of sale
There must be evidence of sale for export to the country of importation i.e. commercial invoices, contracts, purchase orders, Bank remittance slips etc
- Condition Two
No restrictions on the disposition or use
There must be no restriction on the disposition or use of the goods by the buyer, other than restrictions which:
The above situation is further explained in paragraph 1(b) of the Interpretative Notes through the following three situations:
- The seller establishes the price of the imported goods on condition that the buyer will also buy other goods in specified quantities.
- The price of the imported goods is dependent upon the price or prices at which the buyer of the imported goods sells other goods to the seller of the imported goods.
- Condition 3
Where the sale or price is subject to some condition or consideration for which a value cannot be determined with respect to the imported goods.
Condition 4
- That no part of the proceeds of any subsequent resale, disposal or use of the imported goods by the buyer will accrue directly or indirectly to the seller unless an appropriate adjustment can be made in accordance with the provisions of Article 8.
- Condition 5
- The buyer and seller are not related, or where the buyer and seller are related, that the transaction value is acceptable for customs purposes under the provisions of paragraph 2 of Article 1 that is to say that if the relationship did not influence the price the transaction value may be accepted. The transaction value between related parties may also be acceptable subject to application of test values as follows:
- the transaction value in sales to unrelated buyers of identical or similar goods for export to the Partner State;
- the customs value of identical or similar goods as determined under provisions of Paragraph 6;
- the customs value of identical or similar goods as determined under provisions of Paragraph 7.
- Parties deemed to be related
- they are officers or directors of one another’s businesses;
- they are legally recognised partners in business; (b) they have an employer and employee relationship;
- any person directly or indirectly owns, controls or holds five percent or more of the outstanding voting stock or shares of both of them;
- one of them directly or indirectly controls the other;
- both of them are directly or indirectly controlled by a third person;
- together they directly control a third person; or
- they are members of the same family