WORLD TRADE  
ORGANIZATION  G/VAL/W/130 
23 February 2004 
 
 (04-0742) 
Committee on Customs Valuation Original:   English 
  
 
ANSWERS TO QUESTIONS FROM THE UNITED STATES REGARDING NOTIFICATION 
UNDER ARTICLE 22 OF THE AGREEMENT ON CUSTOMS VALUATION 
(G/VAL/W/128) 
 
Communication from Thailand
 
 
  The following communication, dated 13 February 2004, is being circulated at the request of 
the Delegation of Thailand. 
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  Regarding Thailand’s notification under Articl e 22 of the Agreement on Implementation of 
Article VII of the General Agreement on Tariffs  and Trade 1994 and questions submitted by the 
United States with respect to Thailand’s Custom Act B.E. 2469 and the Ministerial regulation No. 132 
(B.E. 2543), hereinafter referred to as MR. No. 132, the Royal Thai Customs, hereinafter the RTC, 
would like to address and clarify all the questions as follows: 
 
Regarding Section 3. Section 11 bis of the Customs Act B.E. 2469   
 
 This section appears to provide the RTC with th e authority to arbitrarily uplift the declared 
value.  Section 11 bis. states:  “If the declared valu e is clearly low or does not reflect the true value of 
the goods and if the customs value is determined  under the rules, procedures and conditions in 
accordance with the customs va lue or value in (2) (a) (b) (c) (d) and (e) of the definitions of ‘customs 
value’ or ‘value’ in Section 2, the price is still cl early low or does not reflect the true value of such 
goods, the Director-General shall have the power to  determine the customs value.”  This measure 
appears to give the Director General the authority to determine the customs value when the price is 
found to be “clearly low or does not reflect the true value of the goods,” even though the declared 
value was determined accordance to the methods set forth in the WTO Valuation Agreement.  How is 
this measure consistent w ith Thailand’s obligations under the WTO Agreement? 
 Answer   Thailand has always been in compliance with  the WTO Transaction Value principal. To 
date, the RTC has abolished the use of refe rence prices in determining customs value. 
Likewise, the Director-General never uses his authority to determine the customs value. 
Therefore, Section 11 bis of the Customs Act B.E. 2469 will be repealed by the RTC and is currently in the process of being presented to the Parliament. 
 Regarding Sufficient Guarantee 
 
 The legislation as submitted does not include  a provision regarding the release of the 
imported goods upon the provision of a sufficient guarant ee such as a surety as set forth in Article 13 
of the Agreement.  We request additional inform ation from Thailand on how it intends to implement 
this provision. 
 G/VAL/W/130 
Page 2  
 
 Answer   The obligation of Article 13 is covered unde r Section 40 and Section 112 of the Customs 
Act B.E. 2469 as follow: 
   Section 40  Before the release of any goods from the custody of the Customs, the 
importer shall have fully complied with this Act and other laws, relating to the Customs, 
made due entry, and paid the full amount of duty or provided cash security therefore.  The 
application for providing cash security shall be in accordance with the regulations laid 
down by the Director-General.  
   In case where there is an application and the Director-General deems necessary that the 
goods have to be released from the custody of  the Customs urgently, he has the power to 
release such goods from custody of the Cust oms, under the condition specified by him, 
without prior compliance with the provisions  of paragraph one and in the case where the 
goods may dutiable, cash or other securities to his satisfaction shall be provided to guarantee the amount of duty. 
 
  Section 122  In the case where the comp etent officer raises a question on the amount of 
duty of any goods which are being passed through Customs, such goods shall be removed to the Customs House or placed in a place of security, unless the Competent Officer and 
the owner of the goods or his agent agree th at a sample representing the goods shall be 
taken, and the question at issue be decided th erefrom.  In order to safeguard the revenue 
of the State, the amount of duty declared in the entry by the importer or exporter, as the 
case may be, shall be paid and an additi onal sum of money covering the maximum duty 
payable on the goods shall be deposited as a guarantee, but the Director-General may 
issue a notification accepting the guarantee of , under the conditions that deem fit, the 
Ministry of Finance or a bank in lieu of such additional deposit. 
 
Regarding the Treatment of Confidential Information 
 
 The legislation as submitted does not include provisions regarding the treatment of confidential information as provided in Article 10 of the Agreement.  We request additional 
information from Thailand on how it intends to implement this provision. 
 
Answer   The treatment of Confidential Information as required by Article 10 of the Agreement is 
provided in the Trade Secret Act B.E. 2545 and the RTC has reviewed MR No. 132 (B.E. 2543) to incorporate and revise the Regulation to comply with Article 10 of the Agreement, the process is yet to be approved by the Council of State. 
 
  Trade Secret Act B.E. 2545    Article 33  Any person disclosing the commerc ial information of the other, which is by 
nature confidential, by intention to destroy the other’s business in any manner, shall be 
liable to a penalty not exceeding, one year of imprisonment or a two hundred thousand 
Baht fine or both. 
   In addition to the Trade Secret Act, the RTC is considering the issuance of Customs 
Department’s Rules specifying the procedur e for officers in keeping and maintaining 
confidential information. 
  G/VAL/W/130 
 Page 3 
 
 
 Regarding Currency Conversion 
 
 The legislation as submitted does not include a provision regarding currency conversion as 
provided in Article 9 of the Agreement.  We reque st additional information from Thailand on how it 
intends to implement this provision.   
 
Answer   Currency Conversion as required by Article 9 of the Agreement is provided in the 
Customs Code of Conduct, B.E. 2546 which re quires the rate of exchange provided by 
the Bank of Thailand, to be duly published as notification at the RTC headquarters and 
every regional Customs office, as well as on the official website of RTC. The applied rate 
of exchange will be at the time of import ation or exportation as provided under Section 
41 and 45 of the Customs Act B.E. 2469 respectively. 
   Section 41   If it shall be necessary for any purpose relating to Customs to determine the 
precise time at which the importation of any g oods shall be deemed to have brought to 
effect, such time shall be deemed to be th e time at which the ship importing such goods 
actually came within the limits of the port of discharge of consignment. 
   Section 45   Before the exportation of any goods, the exporter shall have fully complied 
with this Act and other laws relating to Cu stoms, made due entry, and paid the full 
amount of duty or provided cash security th erefore. The application for providing cash 
security shall be in accordance with the regul ation laid down by the Director-General. 
   In the case where there is an application and the Director-General deems necessary that 
the goods have to be exported ur gently, he has the power to allow the exportation of such 
goods, under the conditions specified by hi m, without prior compliance with the 
provisions of paragraph one, and in the case where the goods may be dutiable case or other securities to his satisfaction shall be provided to guarantee the amount of duty. 
 
Regarding Notice 
  The legislation as submitted does not include a provision requiring that notice of the decision 
on appeal and the reasons for such decision shall be  provided in writing as required by Article 11.3 of 
the Agreement.  Also, the legislation as subm itted does not include a provision regarding the 
publication of laws, regulations, judicial decisions a nd administrative rulings of  general application as 
provided in Article 12.  Finally, the submitted le gislation does not contain a provision requiring a 
written explanation as to how the customs value w as determined as required by Article 16.  We 
request additional information from Thailand on how it intends to implement these provisions.   Answer   To comply with Article 11.3 of the Agre ement, the rights of appeal are open to the 
importer and the exporter without penalty under the section 112 sex of the Customs Act 
B.E. 2469. Reason and decision of the appeal  shall be given in writing as according to 
Section 112 septendecim of the Customs Act B.E.  2469 and the right for further appeal is 
stated under section 112 octodecim of the Customs Act B.E. 2469. In addition, these provisions are also included in the Customs Code of Conduct B.E. 2544. 
   The RTC, as subjected by the Official Info rmation Act, B.E. 2540, provides information 
on the publication as required by Article 12 as follows: 
  - The Customs Act B.E. 2469, Customs Act (no. 17) B.E. 2543, MR (No. 132) B.E. 2543 
etc. are published in the Government Gazette, on the internet, on the official website of G/VAL/W/130 
Page 4  
 
 RTC ( www.customs.go.th
) and that of the Council of State ( www.krisdika.go.th ).  The 
hard copy version of the Act is al so available for sale at the RTC. 
  - Judicial Decisions are published and availabl e at the Court of Justice. The Administrative 
Ruling of General Application Related to the Agreement is in the process of being 
compiled and will be published on the official website of the RTC as soon as possible. 
   The RTC has reviewed MR. No. 132 (B.E. 2543) and will make necessary alterations in 
order to comply with Articles 12 and 16 of the Agreement, and is currently in the process 
of approval by the Council of State.  
 
  However, the RTC has stipulated that the Cu stoms order, in the form of Customs Code of 
Conduct and Notification, comply with Articles 12 and 16 of the Agreement and implemented on October 1
st, B.E. 2546 (2003). 
 Regarding Royalties 
 
 The legislation and regulati ons as submitted do not fully impl ement Article 8.1(c) of the 
Agreement which requires an addition to the price ac tually paid or payable for “royalties and license 
fees related to the goods being valued that the buyer must pay, either directly or indirectly, as a 
condition of sale of the goods being valued...” The relevant provision of  the Thai Regulations (Article 
9.1) does not contain the condition of sale require ment.   How does Thailand intend to address this 
matter?     Answer   Article 8.1 (c) of the Agreement contai ns the Condition of Sale Requirement, but 
Article 9.1 of MR. (No. 132) B.E. 2543 does not contain such condition. The RTC finds 
that the last sentence which reads “as a cond ition of sale of goods being value” is missing 
in the English version of Article 9.1 but is in the original Thai version.  The Customs Code of Conduct fully complies with the Agreement. The RTC is going to make a 
correction and notify it as soon as possible. 
 
Regarding the Interpretative Note 
 
 Many of the interpretative notes of the WTO Ag reement are not incorporated in the notified 
legislation and regulations as require d by Article 14 of the Agreement.  (For example, the requirement 
in the General Note that the customs administra tion shall utilize information prepared in a manner 
consistent with generally accepted accounting principles in the country which is appropriate for the 
Article in question; the definition of price actually paid or payable in the Note to Article 1, the 
explanations regarding the circumstances of sale test set forth in the Note to Article 1, paragraph 2.3; 
and the methods of determining the profit and general expenses set forth in the Notes to Articles 5 and 
6).  How does Thailand intend to address this matter?  Answer   Article 14 of the WTO Agreement does not require the interpretative notes to be 
incorporated in the legislation and regulati ons, but rather requires the notes to be read 
and applied in conjunction with their r espective notes. Given such a requirement, 
Thailand is fully committed to the Agreemen t as stated in Article 6 of MR. (No. 132) 
B.E. 2543:  “The notes in Annex 1: Interpretative Notes, of the Agreement on Implementation of Article VII of the Gene ral Agreement on Tariffs and Trade 1994 shall 
be read and applied, in conjunction with th e valuation of the customs value under these 
Ministerial Regulations.” 
 
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