G/VAL/W/230  
 
2 August 2013  
(13-4174)  Page: 1/5  
Committee on Customs Valuation  Original: English  
 
 NOTIFICATION UNDER ARTICLE 22 OF THE AGREEMENT ON  
IMPLEMENTATION OF ARTICLE VII OF THE GENERAL 
AGREEMENT ON TARIFFS AND TRADE 1994 
UKRAINE 
Replies by Ukraine to questions from The United States 
 
The following communication, dated 26 July 2013, is being circulated at the request of the 
delegation of Ukraine.   
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With regard to the questions posed by the United States (G/VAL/W/221) in connection with the 
Ukrainian notification G/VAL/N/1/UKR/2, please see below the answers prepared by the responsible authorities in Ukraine. 
 
Information on the Application of Certain Pr ovisions of the Customs Code of Ukraine 
Answer to Question 1 
Article 52 of the Code refers to the consultation specified in paragraph five of Article 55 of the 
Code and in part four of Article 57 of the Code. 
Thus, the main method of customs valuation of the goods imported into the customs territory of 
Ukraine under the customs regime of import, is first method - that is of contract price or 
transaction value. 
Each of the following methods is applied if only  the customs value of goods cannot be determined 
by applying the previous method according to the Code provisions. 
Consultations procedure between the customs author ities and the declarant to determine the cost 
basis in accordance with the provisions of Articles 59 and 60 of the Code goes before the use of other methods.  During these consultations, the customs authority and the declarant may share the available information at the condition that confidentiality requirements are respected 
(Article 57 of the Code). 
Besides, at the declarant's request, the consultations should be held in writing. Thus, consultations are held after declaring by the declarant the customs value, if it is impossible 
to apply the main method. 
Answer to Questions 2 and 7 
According to Article 1 of the Law of Ukraine "On Foreign Economic Activity" foreign economic 
contract is a materially executed agreement of two or more economic operators and their foreign G/VAL/W/230 
 
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  counterparts, aimed at the establishment, modifica tion or termination of their mutual rights and 
obligations in foreign activity. 
Thus, if the reason for the goods movement is the legal relations of the parties, the importer, at 
request of the customs authority, should be ab le to provide the contract that governs this 
relationship. 
However, the national legislation of Ukraine (par agraph 1 of Article 202 of the Civil Code of 
Ukraine) determines that transaction is an action  of the person aimed at acquiring, changing or 
terminating of civil rights and obligations. 
According to paragraph 1 of Article 31 of the Law of Ukraine "On International Private Law", unless 
otherwise provided by law, the form of the tr ansaction must meet the requirements of law 
applicable to the content of the transaction, but it is sufficient to comply with law where 
transaction was committed, and if the parties of transaction are situated in different states - the 
law of residence of the party, which has made an  offer, unless otherwise provided by contract. 
Provisions of Article 207 of the Civil Code of Ukra ine set requirements for written transaction, and 
provides, inter alia , that the transaction is deemed to be committed in writing if: 
-  its content is recorded in one or more documents, letters, telegrams exchanged by the 
parties; 
- the will of the parties expressed by teletype, electronic or other technical means of 
communication; and 
-  it is signed by the party (parties). 
Thus, in case of presenting by declarant to the customs of other documents that contain the 
content of the transaction or other grounds established by law for the movement of goods and 
vehicles across the customs border of Ukraine, the following documents (one or more) may be accepted by the customs authorities in lieu of foreign trade agreements (contracts) on condition of 
availability of sufficient data to fill the customs declaration. 
Answer to Question 3  
The customs authority may verify the authentici ty or accuracy of any claim, document or 
calculation presented for purposes of determining the customs value (point 1 of part five of 
Article 54 of the Code). 
Concerning the request for additional documents we would like to inform you, that in accordance 
with paragraph 5 of Article 54 of the Code, the customs authority has the right to request 
supporting documents and information in writing from the declarant or his authorized 
representative, as it is provided in Article 53 of the Code, if it is necessary for taking decision on the recognition of the declared customs value. 
Thus, the Code recognizes the right but not the obligation of the customs authorities to request 
additional documents.  It should be noted that the customs authority should have reasons for requesting additional documents, namely: 
-  if the documents, mentioned in the second paragraph of Article 53, contain discrepancies, 
obvious signs of fraud or does not contain all the information confirming the numeric values of the customs value components of the goods or  information on the price that was actually 
paid or payable for the goods; and 
-  if the customs authorities have reasonable grounds to believe that the existing relationship 
between the seller and the buyer influence the customs value declared by the declarant. 
The list of the documents confirming the cust oms value of the goods determined by the 
paragraphs 2-4 of Article 53 of the Code is compre hensive.  It is prohibited to demand from the 
declarant or authorized person any other documents than those listed in this article. G/VAL/W/230 
 
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  Answer to Question 4 
The list of documents confirming the customs value of the goods is determined by Article 53 of the 
Code. 
Information about these documents should be indicated in the customs declaration, even if the 
buyer and the seller are interrelated entities.  Cases, when a declarant or his authorized 
representative are obliged to provide (if available) additional documents upon a  written request of the customs authority within ten days, are establishe d by the third and fourth part of Article 53 of 
the Code. 
The declarant or his authorized representative upon written request of the customs authority 
should provide within ten days (if available) addi tional documentation, if the documents provided 
under the second paragraph of Article 53 of the Code contain discrepancies, signs of forgery or 
does not contain all information that confirms numeric values of the components of the customs 
value of the goods or information on the price that was actually paid or payable for the goods. 
If the customs authorities have reasonable ground s to consider that the existing relationship 
between the seller and the buyer influences the declared customs value, the declarant or his 
authorized representative upon written request of the customs authority, in addition to the 
documents mentioned in paragraphs two and three of  this article presents (if available) documents 
mentioned in part four of Article 53 of the Code. 
Thus, the customs authority has the right to request from the declarant or his authorized 
representative in written form, additionally to th e documents established by part two of Article 53 
of the Code, the documents specified in part th ree of Article 53 of the Code, as well as the 
documents specified in part four of Article 53. 
Answer to Question 5 
It should be noted, that the customs authorities consider and analyse all the additional documents 
presented by the declarant or his authorized repr esentative in accordance with Article 53 of the 
Code, including those presented on their own will. 
Answer to Question 6 
According to Articles 255 of the Code, customs clearance should be completed within four working 
hours from the moment of presentation to customs authorities of goods, commercial vehicles, which are subject to customs clearance (if they are subject to presentation in accordance with this Code), presentation of customs declaration or document to replace it according to the law, and all 
the necessary documents and information spec ified in Articles 257 and 335 of the Code. 
The period mentioned in Article 255 of the Code may be extended for the time necessary to 
conduct the relevant formalities, exclusively, in the case of presenting of additional documents in 
accordance with Article 53 of the Code. 
The decision to refuse in customs clearance should be taken within the time determined by 
Article 255 of the Code as to customs clearance completion. Absence of such a decision within the 
specified period may be considered as inaction that can be appealed in a manner prescribed by 
Chapter 4 of the Code. 
Thus, in the case of presentation by the declarant or by his authorized representative of additional 
documents or of written refuse from presentation of such additional documents, customs 
clearance, including the decision of customs author ity as to correction of customs value of goods, 
shall be conducted within the time envisaged by Article 255 of the Code. 
Answer to Question 8 
Procedure for inclusion of royalties or other licence fees to the price actually paid or payable for 
the goods being valued, during customs valuation,  is approved by the Decree of the Cabinet of 
Ministers of Ukraine of 21 May 2012, No. 446. G/VAL/W/230 
 
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  The above mentioned procedure establishes the mechanism of inclusion royalties and other licence 
payments to the customs value. 
The Procedure stipulates that if at the moment of customs clearance of the goods that are being 
valued, the amount of the royalties or other license fees are unknown, the declarant or his 
authorized representative shall calculate the amo unt of royalties or other licence fees based on: 
-  planned indicators, based on the amount of royalties or other licence fees paid for identical 
goods in the previous period, if the licence agreement or other agreement regarding the 
disposal of intellectual property rights includ es the payment of royalties based on profits; 
-  predicted indicators, base of royalties and other licence fees used for the determination of 
amount of royalty and other licence fees under  the terms of the licence agreement or other 
agreement regarding the disposal of intellectual property rights. 
Answer to Question 9 
As it was noted in the answer to Question 6, customs clearance is to be completed within the 
period foreseen by Article 255 of the Code. 
If the customs authorities have reasonable grounds to believe that the existing relationship 
between the seller and the buyer has influenced on  declared customs value, the declarant or his 
authorized representative, upon written request of the customs authority, in addition to the 
documents mentioned in paragraphs two and three of  this article presents documents (if available) 
specified by part four of Article 53 of the Code. 
When requesting additional documents, custom s authority shall inform the declarant or his 
authorized representative on justification that the existing relationship between the seller and the 
buyer influenced the customs value declared by the declarant. 
The period mentioned in Article 255 of the Code, may be exceeded for the time of conducting the 
relevant formalities, exclusively, in case of additional documents presentation.  Additional 
documents specified by the third and fourth part of  Article 53 of the Code shall be presented within 
ten calendar days. 
Thus, the declarant, within the period established by part three of Article 53 of the Code, has the 
right to answer and provide a proof of absence of  the influence of the relationship between seller 
and buyer on a price that was actually paid or payable for the goods being valued. 
Answer to Question 10 
Part two of Article 62 of the Code envisages deducting of tax payable in Ukraine due to importation 
(import) or selling (expropriation) of goods from the unit price at which evaluated or identical or 
similar (analogous) imported goods are sold in Ukraine in the greatest aggregate quantity to buyers who are not related to the sellers at the same time or at a time closer to the date of 
importation of the goods being valued. 
As determined in paragraph 27 of Article 4 of the Code, in connection with the importation into the 
customs territory of Ukraine of goods, the following  customs duties are collected:  tax, excise tax 
on importation into the customs territory of Ukraine of excisable goods (products), value added tax 
on imported into the customs territory of Ukraine goods (products).  Thus, the term "taxes" mentioned in Article 62 of the Code, includes customs duties. 
Answer to Question 11 
Pursuant to part V of the Code, the introduced in Ukraine customs regimes include the following 
importation of goods into the customs territory of Ukraine: 
1)  import (release for free circulation) (Chapter 13 of the Code); 
2)  re-import (Chapter 14 of the Code); 
3)  temporary importation (Chapter 18 of the Code); 4)  customs warehouse (Chapter 20 of the Code); G/VAL/W/230 
 
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  5)  free customs zone (Chapter 21 of the Code); 
6)  duty-free trade (Chapter 22 of the Code); 7)  inward processing (Chapter 23 of the Code); 8)  destruction or damage (Chapter 25 of the Code); and 
9)  rejection in favour of a State (Chapter 26 of the Code). 
Placing of goods under the customs regime is co nducted through the declaration and execution of 
customs formalities required by the Code. 
Condition for being under customs regime of goods,  vehicles for commercial use, restrictions on 
their use, the application of tariff and non-tariff regulation of foreign economic activity are determined by the Code and other legislative ac ts of Ukraine on  state customs and foreign 
economic activity. 
Answer to Question 12 
Procedures and methods of customs valuation of g oods crossing the customs border of Ukraine are 
determined by Article III of the Code and based on  the provisions of Article VII of the General 
Agreement on Tariffs and Trade and the Agreemen t on Implementation of Article VII of GATT. 
Article 17 of the Agreement on Implementation of  Article VII of the GATT provides that nothing 
shall be construed as restricting or calling into questions the right of customs administrations to 
satisfy themselves as to the truth or accuracy of any statement, document or declaration 
presented for customs valuation purposes. 
Based on international experience, Ministry of  income and charges of Ukraine is using an 
Automated analysis and risk management system as one of the controlling mechanisms of the 
correctness of customs valuation. 
Risk management system is used by the Ministry in accordance with the International Convention 
on the Simplification and Harmonization of Customs Procedures. 
The risk management system is a software and information system which is based on 
means of estimation of probability of non-compliance with legislation including customs valuation of goods, and is applied at analysis of the electronic version of customs declaration. 
Thus, the results of risk management system operation is only a recommendation for customs 
officials to analyse in more detail the conditions of foreign operations, in particular by verification of documents and information presented for confirma tion of the declared customs value of goods. 
 
 
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