Procedures for Controlling the Customs Value of Goods
- By Alexey Arkhipov
- Dec. 01 2009 00:00
The procedure for controlling the customs value of goods (hereinafter — “CVG”) moved across the customs border of Russia and the possibility of it changing are vital issues for all company participants of foreign economic activities.
Presently, the Russian parliament is considering the draft Federal Law “On Amending Article 323 of the Customs Code of the Russian Federation” (hereinafter — the “Draft Bill”), which proposes changing the rules for declaring and controlling CVG. We mention various points that appear to be the most topical.
As before, it is suggested that a certain number of procedures carried out by the customs authorities be regulated by departmental regulatory legal acts.
At the same time, it appears that the refinement of such procedures as customs control must provide for regulating them most precisely at the level of law. Developing document forms and internal work of the regulatory authorities could be left at the level of departmental regulation.
In particular, together with the Finance Ministry, the Customs Service proposes to determine the procedure for informing a declarant of the customs authorities’ decision to adjust CVG. At present, in accordance with the amended article, the customs authorities must notify a declarant of their decision in writing by the day after the date that the decision is made.
Thus, three undeniable shortcomings are seen in the proposed change. First, the greatest guarantee of security of the rights and interests of declarants is ensured by legislative regulation of the given procedures (however, in this case, the level of regulation “descends” from legislative to departmental). Second, it appears that notifying a declarant of a decision of the customs authorities is not at all a complex procedure requiring that a respective regulatory act be developed; it could be described in one of the provisions of the Draft Bill. Third, it is not entirely clear what is meant by the term “informing”: handing over a copy of the decision, written notification, or a verbal/electronic message.
The Draft Bill stipulates that, upon the results of CVG control, the customs authorities shall decide to either accept the declared CVG or to adjust it.
Moreover, as follows from the contents of the Draft Bill, a decision to adjust the declared CVG may be made not only after an additional audit is conducted but also without one having been conducted. At the same time, in our opinion the conditions under which the customs authorities must carry out an additional audit are not stated altogether clearly. This is important since the legal consequences differ for an adjustment of declared CVG made without an additional audit and an adjustment made after one.
In the first case, the customs authorities send a request for changing inaccurate information and the calculation of customs payments, and they release the goods only after additional customs payments are made. In the second case, the customs authorities inform the declarant of the amount of the security for the customs payments required for releasing the goods, and they release them when the said security is provided.
Furthermore, a declarant’s right to substantiate the legality of using the chosen method for determining the CVG and the accuracy of the presented information is stipulated only in provisions of the clause concerning carrying out an additional audit.
It seems, however, that this right of a declarant should be unconditional and that it would be preferable if a declarant was able to substantiate the legality of its assessment of the CVG and the accuracy of the declared information before the customs authorities make a decision to adjust the CVG.
Otherwise, the capability of adjusting CVG without conducting an additional audit may, in our opinion, induce the customs authorities to adjust CVG without giving declarants an opportunity to justify the legality of the chosen means of determining CVG and the accuracy of declared information.
Besides the aforesaid, the logical structure of the Draft Bill also arouses censure. Its provisions are devoted to procedural issues, and it would be reasonable to state them in chronological order. However, this is done only in part, and therefore the customs authorities’ procedures, rights and obligations and declarants’ rights and obligations in the course of controlling declared CVG are not precisely and unambiguously regulated.