RESTRICTEDWORLD TRADE
ORGANIZATIONG/VAL/W/53
14 December 1999
(99-5426)
Committee on Customs Valuation Original:  Spanish
COMMUNICATION FROM COLOMBIA CONCERNING
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 10 December 1999, has been received from the
Permanent Mission of Colombia.
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Pursuant to Annex III, paragraph 1 of the Agreement on Implementation of Article VII of the
General Agreement on Tariffs and Trade 1994 (WTO Customs Valuation Agreement), the
Government of Colombia hereby duly requests a further extension for a period of three years of thedelay in the full application of the provisions of that Agreement.
JUSTIFICATION OF THE EXTENSION
The technical implementation of the Customs Va luation Agreement requires an infrastructure,
implying:
- Proper administrative organization;- information systems covering the whole country;- proper understanding of the subject;
- administrative procedures in keeping with the provisions of the Agreement.
Administrative organization
Over the past few years, the Colombian Customs Administration has undergone a number of
administrative reforms affecting its organization and functions, leading to decentralization and a
transfer of functions between different branches, and involving continuous staff movements.  This has
made it much more difficult to take full advantage of the training provided in the field of customs
valuation, which does not currently meet the standards of specialization required in that area.
In 1997, in response to the need to establish a specialized organizational structure to facilitate,
foster and develop the technical aspects of customs valuation in the country, the Technical Customs
Sub-Directorate and the Tariff and Valuation Divisions were finally set up with central offices
responsible for outlining general policies and procedures and local branches of an operational nature.G/VAL/W/53
Page 2
An administrative infrastructure is currently being organized, with a new system of
recruitment and promotion and a disciplinary regime which will guarantee the technical conditions
required for the full implementation of the Agreement only in the medium term.
The extension of the delay would make it possible to provide better training for the customs
authorities and foreign trade users and to introduce the instruments and procedures needed to
implement the Agreement on Customs Valuation.
Information systems covering the whole country
A new computer program is currently being introduced to systematize customs procedures
with a view to making user formalities easier and more flexible while allowing for efficient control.
This program calls for the introduction of the Customs Valuation Information System, which will
facilitate the use of the valuation methods set forth in Articles 1, 2 and 3 of the Agreement and will be
available to all of the customs administrations.  The project is to be completed during the first quarter
of 2003.  For the moment, only two modules have been introduced, initially usable only in the Capital.
The implementation of this system will provide the customs authorities with the "'test' values
previously accepted by the customs administration" and therefore acceptable under the provisions of
Article 1 and its Interpretative Note, as well as the transaction value of identical and similar goods
sold in the conditions set forth in Articles 2 and 3, as a condition for applying the methods provided
for therein.
The development and application of the Information System requires the adaptation of the
physical infrastructure and calls for an investment programme to develop computer applications and
purchase hardware and software, which in turn calls for considerable financial resources.
Proper understanding of the subject
Customs valuation is a complex subject which can only be handled by an administration that
fully understands how it works and by trained staff.
The Technical Sub-Directorate created only two years ago is essentially made up of
professionals in different areas responsible, among other tasks relating to importation and subsequentinspection, for valuation, and who are receiving specialized training with regard to the Agreement.
However, specialized personnel devoted specifically to this area is currently unavailable.
Administrative procedures in keeping with the provisions of the Agreement
A Decree will soon be issued amending and compiling customs legislation and regulating
valuation procedures in conformity with the Agreement.
This domestic legislation provides for the application of the valuation methods set forth in
Articles 1 to 7 of the Agreement.  It also calls fo r the application, in conformity with paragraph 2 of
Annex III to the Agreement, of minimum official pr ices for certain industrial and agricultural products
that are particularly prone to under-invoicing.
However, this Decree will be followed up with regulation and training at the official and
private levels in order to ensure that it is properly implemented.  The simplification of the proceduresinherent in the systematization will free up a significant number of staff to be trained in the technical
area of customs valuation.G/VAL/W/53
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For the reasons set forth above, the process of administrative organization, systematization
and administrative training on which the Government has embarked can only be completed if the
requested three-year extension is granted.  These elements, together with the assignment of personnel
exclusively to the technical implementation of the valuation system, will make it possible to overcome
the mentioned limitiations and shortcomings.
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