CBP: New Ruling Excludes Certain Commission Payments from Dutiable Value

(World Trade Interactive)

U.S. Customs and Border Protection has announced that as of Feb. 8, 2010, it is revoking ruling HQ H006588 on whether certain commission payments are included in the appraised value of imported merchandise under 19 USC 1401a. CBP states that since its decision to revoke is based on the specific facts of the particular matter at hand, it is not revoking or modifying any other rulings or any treatment.

In ruling HQ H006588, CBP determined that the importer did not meet its burden of establishing that payments made to a purported buying agent abroad constituted bona fide buying commissions because there was insufficient documentary evidence to establish the existence of a bona fide buying agency relationship. Consequently, the payments made to the alleged buying agent were included in transaction value as an addition to the price actually paid or payable.

CBP has since reconsidered its position in light of additional information that was made available regarding the control exercised by the importer/principal over the purported agent. The importer has also revised the buying agency agreement and a joint venture agreement relative to this matter. In light of this additional information, CBP considers that the particular payments at issue constitute bona fide buying commissions. As such, they are not included in transaction value as part of the price actually paid or payable or as an addition thereto and are not dutiable. CBP is therefore issuing ruling HQ H022168 to revoke HQ H006588.