11. Method V: Computed value

Computed value works in the opposite direction to deductive value: it builds the Customs value up from the cost of producing the goods in the exporting country.

The Computed Value Method determines Customs value by totalling the following elements:

01 Materials and fabrication

The cost or value of materials and fabrication or other processing employed in producing the imported goods.

02 Profit and general expenses

An amount equal to that usually reflected in sales of goods of the same class or kind by producers in the country of exportation for export.

03 Other expenses

All other expenses necessary to reflect the valuation option chosen under Article 8.2 - including transport, loading/unloading, handling, and insurance.

The following additional points are relevant to the Computed Value:

  • ·         The customs value is determined on the basis of information readily available in the country of importation
  • ·         Use of the Computed Value Method is generally limited to cases where the buyer and seller are related, due to the commercially sensitive nature of the information that must be provided.
  • ·         The producer of the goods must be willing to supply the necessary cost information and agree to any subsequent verification.
  • ·         Cost and value information of the imported goods must be based on the commercial accounts of the producer, consistent with generally accepted accounting principles.
  • ·         Profit and general expenses information must be consistent with that usually reflected in sales of goods of the same class or kind.
  • ·         No contracting party to the Agreement may require or compel any person not resident in its own territory to produce for examination, or to allow access to, any account or other record
  • ·         “Goods of the same class or kind” (defined in Article 15) are goods in a group or range produced by a particular industry or sector, including identical or similar goods; they must be from the same country of exportation, judged case by case.

In the experience of countries applying the Valuation Agreement, this is the least-used of the six methods provided within the WTO Agreement, for the reasons listed above.