. /.RESTRICTEDWORLD TRADE
ORGANIZATIONG/VAL/W/42
22 October 1999
(99-4611)
Committee on Customs Valuation Original:  Spanish
COMMUNICATION FROM PARAG UAY CONCERNI NG ANNEX III,
PARAGRAPH 1 OF THE AGREEMENT ON IMPLEMENTATION
OF ARTICLE VII OF THE GENERAL AGREEMENT
ON TARIFFS AND TRADE 1994
The following communication, dated 19 October 1999, has been received from the Permanent
Mission of Paraguay.
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I refer to Paraguay's undertaking pursuant to the Agreement on Implementation of Article VII
of the General Agreement on Tariffs and Trade (GATT) of 1994, concerning the general principles of
customs valuation.
In that regard please be informed that the Government of Paraguay has decided to request a
two-year extension for the application of the aforementioned Agreement, under paragraph 1 of
Annex III.
The decision of the Government of Paraguay is based on a careful and exhaustive analysis,
bearing in mind the following factors:
1. Legal and regulatory framework.  Its application in the context of related legal rules
and regulations;
2. Working out the role and redefining the profile of human resources for the full
implementation of the system;
3. Organizational and administrative structure adapted to the relevant control approach
or criterion;  and
4. Technological and computer equipment for the Central Technical Unit and the
regional control units and interconnection between them.
The aforementioned matters are yet to be tackled thoroughly enough to safeguard and protect
fiscal interests by harmonizing the specific and related regulations on valuation.  Modifications will
be needed to make it possible to implement the Agreement and, avoid the use of instruments that
could lend themselves to tax evasion.
A technically rigorous plan must be drawn up fo r both the role and profile of human resources
in order to ensure technically and professionally sound management in line with the structural
improvements introduced.G/VAL/W/42
Page 2
With a view to having a solid organizational and administrative structure for monitoring the
value of goods upon entry, a more in-depth approach is needed as well as a more careful analysis of
operational capacity.
Another noteworthy aspect is the need to provide both the central and regional technical
valuation units with technological and computer equipment in order to ensure the efficient conduct of
the relevant checks in the valuation system that will be put in place.  A shortage of Government funds,
which has made investment impossible, has meant that the administration lacks the communication
infrastructure needed to interconnect the technical units so that they can access the data available at
customs posts and thus establish fair values in all cases.
The foregoing factors would have a negative impact on the country's performance against the
budget in the short-term, adversely affecting th e Government's capacity to meet its financial
responsibilities and undertakings, not to mention the dire social problems that would result.
In the light of these considerations, in addition to delaying the application of the Agreement
by two years, the Government of Paraguay will need  to work jointly and in cooperation with the WTO
in order to overcome the limitations and remedy the shortcomings mentioned above.
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