G/VAL/W/242  
4  April 2014  
(14-2158)  Page: 1/6  
Committee on Customs Valuation  Original: French  
 
  GUIDELINES ON THE DEVELOPMENT AND USE OF A NATIONAL 
VALUATION DATABASE AS A RISK ASSESSMENT TOOL 
The following communication, dated 17 March 2014, is being circulated at the request 
of the Chairperson of the Technical Committee on Customs Valuation. 
 
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 In your report to the 37
th session of the Technical Committee on Customs Valuation (TCCV), 
you informed members of the proposal to organize, in 2014, a seminar on the misuse 
of the valuation databases by certain Member countries of the WTO Committee on Customs 
Valuation (CCV) to which you wish to invite representatives of the ICC, the WCO and governments for a frank discussion of this issue. You also recalled the request made by your predecessor 
in her letter of 7 December 2012 for factual information concerning the misuse of the databases. 
 I replied to the above-mentioned letter with my letter of 15 May 2013, in which I outlined 
the position of the TCCV and the WCO Secretariat on  this issue of the use of the customs valuation 
databases.  I recall in this connection that in response to the mandate it was given in May 2003 by the CCV 
under paragraph 8.3 of the Doha Ministerial Decision, the TCCV developed an instrument, 
the "Guidelines on the Development and Use of a National Valuation Database as a Risk Assessment Tool". This instrument, which is annexed hereto, was transmitted to the CCV 
after adoption by the Council of the WCO at it s session of June 2004. It provides customs 
administrations with relevant information and recommendations concerning the development and use of the national valuation database. 
 
In 2006 and 2007, the Secretariat conducted a surv ey to assess the implementation of these 
Guidelines at the national level, in the form of a questionnaire sent to members of the WCO. In their replies to this questionnaire, most of  the members said that they used the customs 
valuation database as a risk assessment tool to assess potential risk regarding the truth 
or accuracy of the declared customs value with a view to then conducting, where appropriate, 
in-depth inspections of the values in question. None of the respondents acknowledged using this 
instrument to set minimum or reference prices. In spite of the survey results, it is possible that 
certain administrations may be using the valuation database for purposes other than those set forth in the Guidelines. 
 
Moreover, in the framework of its Revenue Pack age, the WCO Secretariat has provided members 
with the instruments, tools and teaching materials they need to strengthen their capacity to collect revenue efficiently and fairly. Point 3d of the "Practical Guidelines for Valuation Control" provides 
further information on best practices in the development and use of a national customs valuation 
database. Also, in the context of its technical assistance and capacity-building activities, the WCO Secretariat takes every opportunity to re mind customs administrations of best practices 
in the use of valuation databases and to help them to become better acquainted with them. 
 Finally, the WCO is prepared to participate in th e seminar proposed by the CCV on possible cases 
of misuse of valuation databases. It hopes that the countries concerned will freely share their 
experiences in the use of valuation databases.  
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  Table of Contents 
PREAMBLE ........................................................................................................................ 3  
1  INTRODUC TION ........................................................................................................... 3  
2  USE OF A DATABASE .................................................................................................... 4  
3  CAVEAT REGARDING THE USE OF A DATABASE ............................................................ 4  
4  DATA TO BE INCLUD ED IN A DATABASE ....................................................................... 5  
5  VALIDITY OF  THE DATA ............................................................................................... 5  
6  POSSIBILITY OF CROSS-CHEC KING ............................................................................. 5  
7  MONITORING MECHANISM ........................................................................................... 6  G/VAL/W/242 
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  PREAMBLE 
1.  These Guidelines address various issues pertaining to the development and use of a national 
valuation database. A national valuation database is a risk assessment tool which may be used by a Customs Administration along with other risk tools to assess potential risk regarding the truth or 
accuracy of the declared Customs value for impo rted goods. The information in the database 
should be recent data reflecting the Customs value and other pertinent information for previously imported goods. The values may not be used to determine the Customs value for imported goods, 
as a substitute value for imported goods, or as a mechanism to establish minimum values. 
In addition, recognizing that differences in prices, including substantial declines, are a part of international trade, a difference between the decl ared value and the database value(s) is not by 
itself a reliable indicator of potential risk with respect to the truth or accuracy of the declared 
value, subject to the provisions of Decision 6.1. 
2.  A Customs Administration that uses a valuation database should establish a monitoring 
mechanism to ensure that the database is being used as a risk assessment tool and that the 
information stored in the database is updated on a regular basis. 
1  INTRODUCTION 
3.  The Agreement on Implementation of Article VII of the GATT 1994, more commonly known 
as the WTO Agreement on Customs Valuation (the Agreement), introduces a fair, uniform 
and neutral system for the Customs valuation of imported goods, which is consistent with commercial practices and precludes the use of arbitrary or fictitious Customs values. 
4.  The basis for the valuation of goods under this system is, to the greatest extent possible, 
the transaction value of the imported goods which is the price actually paid or payable 
for the goods when sold for export to the count ry of importation, adjusted in accordance 
with the provisions of Article 8 of the Agreement. 
5.  Where the Customs value cannot be determined using the transaction value method, 
the Agreement provides for five othe r methods, to be used in turn. 
6.  Customs has the right to satisfy itself as to the truth or accuracy of the value declared. 
The application of an appropriate risk a ssessment and management procedure enables 
Customs to exercise this right in a pragmatic manner. Such procedures may use, inter alia , 
a valuation database. 
7.  The data contained in a valuation database should be treated in accordance with the applicable 
confidentiality provisions. 
8.  Within the context of Customs controls, Chapte r 6 of the Guidelines on the General Annex 
to the Revised Kyoto Convention (Customs Controls)  includes the following definitions of the 
concepts of risk assessment and risk management: 
 Risk assessment: "The systematic determination of risk management priorities by 
evaluating and comparing the level of risk ag ainst predetermined standards, target risk 
levels or other criteria." 
 Risk management: "The systematic application of management procedures and practices 
which provide Customs with the necessary information to address movements or 
consignments which present a risk." 
9.  In the context of Customs valuation, applicatio n of the above concepts requires that risk 
assessment mechanisms must be selective and targeted. It is not appropriate to apply simple statistical or price indicators to all imports on a comprehensive basis, as a means 
to measure potential risk with regard to the truth or accuracy of Customs value. The development 
and use of a valuation database must take account of the above-mentioned risk assessment and management procedures. G/VAL/W/242 
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  2  USE OF A DATABASE 
10.  A valuation database may be used by a Customs Administration only as a risk 
assessment tool. It has to be designed specially to assess potential risk regarding the truth or accuracy of the declared value for imported goods. 
11.  Database management systems will usually enable a Customs Administration to compare 
the declared value to previously accepted Customs value(s). Recognizing that price variations are a normal part of international trade, the results of any such comparison do not in themselves 
represent a comprehensive or sufficient indicator of  potential risk. Therefore, while an abnormally 
large difference between the declared value and the databases value(s) for that product could constitute a potential risk factor, any such differe nce must be considered along with other potential 
risk factors, such as the lack of supporting docu mentation, prior problems with the importer, etc. 
in determining what further action, if any, is appropriate with regard to the declared value. 
12.  Where the application of appropriate databa se technology indicates the existence of  potential 
risk in well-defined circumstances, Customs may apply a number of measures. For example, 
Customs may place the operations of a particular  importer under scrutiny and take appropriate 
monitoring action. In other cases where there are concrete indications that the declared values 
represent a risk with respect to their truth or accuracy, and after taking into account 
all the relevant risk factors the Customs Administration has doubts about the truth or accuracy 
of the declared value, it could follow the procedures set forth in Decision 6.1 of the WTO Committee on Customs Valuation. Such procedur es start by asking the importer to provide 
further evidence to support the declared value. Another example of a measure that can be taken 
by Customs Administration in cases of potential risk is a post-importation audit of the importer. 
13.  The Customs Administration cannot reject the declared value based solely on a difference 
between the declared value and the database value( s). Rather, the value(s) stored in the database 
should, alongside other indicators applied by Custom s, serve only as an indicator of potential risk 
and represents no more than initial indicative information helping to reinforce or dispel Customs' doubts about the truth or accuracy of the declared value. 
14.  The database can also be used as a risk assessment tool to perform cross-checks in order 
to target specific import declarations for examination. 
15.  Normally, a valuation database should form part of a more extensive database embracing risk 
assessment linked to other aspects of the import/export operation, such as origin, tariff code 
number, importer's profile, exporter's profile, etc. 
16.  Each Customs Administration should determine, with reference to its own needs, which 
authorized staff will have access to the national valuation database. 
17.  The use of databases in the risk assessment context may occur at any stage: prior to the 
lodging of the import declaration, at the time when the declaration is lodged (verification of the data entered in the declaration), throughout th e clearance process and/or after the goods have 
been released. 
3  CAVEAT REGARDING THE USE OF A DATABASE 
18.  A Customs Administration may not: 
 Use a database to determine the Customs value of imported goods, as a substitute value 
for imported goods or as a mechanism to establish minimum values; 
 Reject the declared value solely on the basis of a difference between the declared value 
and the database values; 
 Disregard the requirements of Article 13 of  the WTO Valuation Agreement (concerning 
release of imported goods upon sufficient gu arantee) in order to employ a valuation 
database; or 
 Use a valuation database as a substitute for other techniques, such as post-importation 
audit, to assess the truth or accuracy of the declared value. G/VAL/W/242 
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  4  DATA TO BE INCLUDED IN A DATABASE 
19.  Within the framework of a risk assessment policy for valuation, the data to be included 
in a valuation database may vary, depending on the state of development of the risk management policy of the Member concerned and should be ba sed on relevant elements from the WCO Customs 
Data Model. 
20.  The usefulness of a valuation database as a ri sk assessment tool depends on the reliability 
and relevance of the data for the purposes of de termining the truth or accuracy of the declared 
value. Therefore, the data should include the Cu stoms value for previous importations determined 
in accordance with the Agreement. The data may also include the applicable method of valuation (for example, transaction value, computed valu e, etc.) and elements included in the Customs 
value (for example, assists, royalties, selling commissions, etc.). Other data from the import 
declaration, such as whether the parties are related, may also be included. 
21.  The data to be included in the database is generally the data found in the import declarations 
and supporting documents of previous importations. The database may also include other 
pertinent and reliable data for risk assessment purposes. 
22.  In an automated database, virtually all of this data could constitute keywords providing search 
access. For example, doing a search on "country of origin" should, at least, make it possible to find 
information about all importations of goods from the country concerned during a specified period; 
at best, it should provide a range of information about the type of goods exported from that country, etc. 
5  VALIDITY OF THE DATA 
23.  In order to properly perform its function as a risk assessment tool, data in the database 
should be recent and up-to-date. What is considered recent and up-to-date may depend on the commodity involved, the frequency of price fluctuations, and other pertinent factors. 
6  POSSIBILITY OF CROSS-CHECKING 
24.  The database can also be used as a means of performing cross-checks in order to target those 
importations which are likely to contain a potential risk and, from that starting-point, select 
the import declarations concerned for examination. 
25.  Thus, for example, if it has been established in the past - under the provisions 
of paragraphs 1(d) and 2 of Article 1 of the Ag reement, and paragraph 4 of Article 15 thereof - 
that a buyer/importer is related to his supplier/seller, that this relationship has influenced 
the price, and that this has caused the declared value to be rejected, there could be a function in 
the system which selects all future declarations concerning transactions between that buyer/importer and that supplier/seller, so that Cu stoms will be in a position to check whether the 
relationship still exists and, if so, whether it is still producing the same effects. 
26.  Similarly, if it has been established in the past - under the provisions of paragraph 1(a) 
of Article 8 - that commissions (other than buying commissions) have been paid in connection with 
a transaction between a buyer/importer and a supplier/seller, and the declared value was adjusted 
as a result, the system should be able to select all future declarations for transactions between that buyer/importer and that supplier/seller, so that Customs can check whether this type of payment is still being made and, where appropriate, adjust the declared value accordingly. 
27.  The same would apply to several other provisions of the Agreement (conditions of application 
of Article 1, goods and services supplied by the buyer, royalties, proceeds of resale, etc.). G/VAL/W/242 
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  7  MONITORING MECHANISM 
28. A Customs Administration that uses a valuation database should establish a monitoring 
mechanism to ensure that it is being used on ly for the purpose of risk assessment described 
in these Guidelines and to ensure that the information in the database is updated on a regular 
and continual basis. 
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