Additions to the Price Paid

Content Price Paid or Payable Additions Additions - Category 1 Additions - Brokerage Expenses Additions - Commissions Commissions/Buying Commissions Buying Commission Selling Commission Additions - Category 2 Additions - Category 3 Additions - Category 4&5 Royalties and Licence Fees Royalties Trademark Licences Licences – conditions of sale

Price Paid or Payable The price actually paid or payable is the total payment made or to be made by the buyer to, or for the benefit of, the seller for the imported goods. It includes all payments made or to be made as a condition of sale of the imported goods by the buyer to the seller. It may also include payments made by the buyer to a third party to satisfy an obligation of the seller. Payment need not necessarily take the form of a transfer of money. Payment may be made by way of letters of credit or negotiable instrument. It may be made directly or indirectly. Indirect payment settlement of a debt owed by the seller by the buyer

Additions valuation rules define certain additions to o the price actually paid or payable.  only those listed in the list  must be based on objective and quantifiable data. Where no objective or quantifiable data available => the transaction value cannot be used.

Additions – Category 1 (additions - if they are deserved by the buyer and not included in the price)  value of containers in which are the goods contained at the time of importation and in which the goods will be sold. Their cost should be included in the customs value. For customs purposes, they are considered a part of actually imported goods (e.g. camera cases, musical instrument cases…) Returnable containers – can be excluded; but charges payable by the importer to the senders for returnable containers must be included. Containers as the goods – to be valuated according customs valuation goods Transportation containers - cost of the use of the container is included in the customs value as part of the transport costs  Cost of packing, comprising the cost both of labor and materials. Packing - any external or internal containers, holders, wrappings or supports other than transport devices (no transport containers), covers, tackle or additional transport equipment. The cost of any such packing and packing materials should be included in the value for customs purposes.

Additions – Brokerage Expenses  Customs clearance charges (Brokerage expenses), either included in the price or otherwise charged to the importer, are included in the value for duty;  Only if they relate to pre- importation costs!

Additions – Commissions  fees paid to a commission BUYING or SELLING agent  agent seems working on his account – in fact works on account of the seller or the buyer  Regular commission agent =>written commission agreement (but verbal agreement allowed) selecting suppliers or purchasers procuring samples of goods procuring or selling goods according to the order inspecting the goods organizing or monitoring storage, transportation and insurance of goods

The agent has to prove the activities he performed (e.g. detailed evidence of costs, contracts and invoices ) Has to follow the booker instruction No responsible for any delays (payment or delivery) Buying Commission Buyer Kazakhstan commission Invoice price Buying Agent Invoice price Seller One purchase 1 st issued by the seller for goods 1 st issued by the seller for goods; 2 nd by the buying agent for commission 1 st issued by the buying agent for goods 1 st issued by the buying agent for goods; 2 nd by the buying agent for commission Customs value 2 invoices: Commissions/Buying Commission

Buying Commission Addition to the Customs Value One invoice: Addition to the Customs Value One part for the price of goods issued by the buying agent. Cleary separated: One part for the price of goods; 2 nd part for buying commission One price includes goods and commission issued by the buying agent. One price includes goods and commission; (in case of future proof of separation can be refunded) Same scenarios as above but issued by the seller. Very unusual - risk factor! Make sure that it is not selling commission!

Selling Commission ManufacturerSeller Buyer Selling agent Clearance time BCBC Buying Commission or should be added Goods sold for export at the time of clearance; Selling commission is either included in the price or should be added the commission should be added to this value Goods were not sold at the time of import clearance yet. Value – identical/similar goods provision; the commission should be added to this value =>deduction method As above, but no info on identical or similar goods transaction price; sale price is known =>deduction method

Additions – Category 2 Assists(additions - if they are not included in the price) items supplied, directly or indirectly and free or at a reduced cost, by the buyer for use in the production and sale of the goods  materials, components, parts and similar items incorporated in the imported goods;  tools, instruments, moulds and similar items used in the production of imported goods;  materials consumed in the production of the imported goods; and  engineering, development, artwork, design work, and plans and sketches (other than research and preliminary design sketches) carried out elsewhere than in the Country of importation and necessary for the production of the imported goods.

Additions – Category 3 Royalties and License fees that the buyer must pay, (directly or indirectly, as a condition of sale of the goods being valued if hey are not already included in the price. Royalties and licence fees should not be added to the price if:  charges for the right to reproduce the imported goods in the Country of importation; or  payments made by the buyer for the right to distribute or resell the imported goods if such payments are not a condition of the sale for export to the Country of importation.

Additions – Category 4&5 Category 4  the value of any part of the proceeds of any subsequent resale, disposal or use of the imported goods that accrues, directly or indirectly to the seller; Category 5  transportation and insurance costs  loading and handling charges associated with the transport of the imported goods to the place of introduction of the goods into the Country of importation.

Royalties and Licence Fees Patents Trademarks Copyrights  Should be considered as a part of the customs value only if: - related to the goods actually imported - they are paid as condition of sale => the buyer should paid for goods + licence fee

Royalties Ingredients, parts, components imported for further manufacturing in the country of importation; unassembled goods or minor operation included Royalties are paid for patents Should be related to imported goods Should be added to the price actually paid or payable Seller (licensor) Importer (manufacturer) Ryls Goods Payment

Trademark Licences Considered as a part of the customs value if: Goods to be re-sold in the same state or only minor operation to be performed after the importation Minor operation: - Labeling - Cleaning - Re-packing - Simple assembling of goods after importation

Trademark Licences Goods marketed with the trade mark; Trade mark can be affixed before or after the importation No matter when the trade mark affixed(some goods are usually labeled after their importation - e.g. goods in bulk) The buyer cannot obtain these goods from suppliers not related to the seller Seller – buyer => licence agreement; quality standards should be kept.

Licences – Condition of Sale Licence fees can be added to the customs value if they are condition of sale Imporer must pay price of the goods + licence fees goods cannot be neither bought nor sold if the licence fees were not paid Recipinet’s of the royalties or licence fees residence country does not affect the valuation. Can be located een in the country of importation

Questions? Thank you for you attention!