The general answers to questions for the methods to calculate theCustoms value of imported goods and due attentions
in relation to such methods.（Oct. 2023）（Table of Contents）
1.

What kind of method shall be used for the calculation of the Customs value of theimported goods?
(Q1-1) In general, what kind of method shall be used for calculation of the Customs
value of the imported goods? ····························································· 1(Q1-2) What is the method of the transaction value of the imported goods (Primarymethod)? ······················································································ 1(Q1-3) What is the import transaction? ·························································· 2(Q1-4) What is the price actually paid or payable?············································ 2(Q1-5) What is a case which is not able to calculate the Customs value of theimported goods based on the Primary method? ································ 2(Q1-6) What kind of goods are considered as imported not by the importtransaction? ·················································································· 2(Q1-7) In order to confirm the existence of import transaction, what kind of
documents or materials should be judged of? ·································· 3

2.

The Identical or Similar goods value method（Article 4-2）
(Q2-1) In which case, the Identical or Similar goods value method (Article 4-2) canbe applied? ··················································································· 3

3.

The Deductive value method (Paragraph 1, Article 4-3)
(Q3-1) In which case, the Deductive value method (Paragraph 1, Article 4-3) can beapplied? ························································································ 4(Q3-2) What kind of expenses shall be deducted from the domestic selling price? · 4(Q3-3) What kind of price can be used as the domestic selling price under thismethod? ······················································································· 4(Q3-4) In case that the domestic selling price is unknown at the time of the importdeclaration, how should the import declaration be made?·················· 5(Q3-5) What kind of case can be considered under the Deductive value method(Paragraph 1, Article 4-3) cannot be used? ······································· 5(Q3-6) Is it possible to use a tentative selling price or a quoting price as a domestic
selling price under the Deductive value method? ······························ 5i4.

The Computed value method (Paragraph 2, Article 4-3)
(Q4-1) What is the Computed value method all about? ····································· 5(Q4-2) In which case the Computed value method can be applied? ····················· 6(Q4-3) What kind of materials should be confirmed for the cost of producing? ······ 6

5.

The Fall-back method (Article 4-4)
(Q5-1) What is the Fall-back method all about? ··············································· 6(Q5-2) What is the “reasonable adjustment” of Articles 4 to 4-3? ························· 7(Q5-3) What is the method set by the Director-General of the Customs?··············· 76.

Due attentions (the calculation of the Customs value of the imported goods which
are for sale through the e-commerce website)(Q6-1) Which method shall be applied to calculate the Customs value of theimported goods which are for sale through the e-commerce website? 7(Q6-2) In case that an importer asks a customs broker to take an import clearance
procedure on his/her behalf, how should the customs broker make theimport declaration when existence of the import transaction or detail of thetransaction of the imported goods is unknown? ······························· 8(Q6-3) When the imported goods will be sold through the e-coomerce website, is it
possible to use an invoice price for an import declaration for Customs
valuation purpose? ········································································· 8(Q6-4) How shall the Customs value be calculated if a non-resident imports the
goods in order to sell them through the e-commerce website? ·················· 8(Q6-5) In case that the imported goods are sold through the e-commerce website bya non-resident, how shall the Customs value be calculated by using a
specific method under the Fall-back method which is set by the DirectorGeneral of the Customs? ································································ 9(Q6-6) In case of applying a method set by the Director-General of the Customs,
what kind of materials should be submitted to the Customs? ·············9(Q6-7) In case that the Customs value shall be calculated based on the estimatedprice by applying a method set by the Director-General of the Customs, howshould domestic transportation costs to be handled if the delivery place or
person/company is unknown, and the costs have not been fixed yet? 10

7.

Others
(Q7-1) At the import declaration, is it necessary to submit a value declaration form
and/or materials for the calculation of the Customs value to theCustoms? ············································································ 10(Q7-2) In case that an invoice is a proforma invoice or a domestic selling price oriidomestic transportation costs to be deducted is unfixed/unknown andtaking long time to determine the Customs value, is it possible to apply
the BP system? ·······································································10(Q7-3) How shall the amount of the deposit on BP system be calculated? ···········11(Q7-4) Is it necessary to correct the declaration of the imported goods if theimporter finds miscalculation of the Customs valueafter the importpermission? ··········································································11iii

The general answers to questions for the methods to calculate theCustoms value of imported goods and due attentions
in relation to such methods.
1. What kind of method shall be used for the calculation of the Customs value ofthe imported goods?
(Q1-1) In general, what kind of method shall be used for the calculation of the
Customs value of the imported goods?
A: In principle, the calculation of the Customs value of the imported goods shall be basedon “method of the transaction value of the imported goods” under paragraph 1 of Article
4 of the Customs Tariff Law (Hereinafter the name of the Law is omitted, unlessotherwise described specifically).
In case that “the method of the transaction value of the imported goods (Primarymethod)” cannot be applied, the following methods (Alternative methods) will beapplied in sequential order.
・”the Identical or Similar goods value method“（Article 4-2）
・”the Deductive value method ”（Paragraph 1, Article 4-3）
・”the Computed value method “ （Paragraph 2, Article 4-3）
・”the Fall-back value method“ （Article 4-4）

(Q1-2) What is the method of the transaction value of the imported goods(Primary method)?
A: The method of the transaction value of the imported goods (Primary method) is tocalculate the Customs value based on the value of the import transaction. “The valueof the import transaction” is that, when the import transaction of the imported goods
has been made, the price actually paid or payable in relation to the import transaction
by the buyer to or for the benefit of the seller for the imported goods (the price actually
paid or payable) and adjusted to take into account certain additional costs such astransportation costs, to the extent that such costs have not been included in the priceactually paid or payable for the imported goods.
In case of calculating the Customs value based on the transaction value, thecalculation of the customs value should be based on invoice and other documents
which are able to verify the price actually paid or payable of the imported goods and tobe adjusted certain additional costs such as the transportation costs.

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(Q1-3) What is the import transaction?
A: The import transaction is that a person or company located in Japan as a buyer, forthe purpose of the goods bring into Japan, has made a sales contract with a seller andsuch sale (import transaction) has actually been made the goods bring into Japan. In
general, a sale actually brings the goods for import into Japan is to subject such sale.

(Q1-4) What is the price actually paid or payable?
A: The price actually paid or payable is the total payment made or to be made by thebuyer to or for the benefit of the seller for the imported goods. It includes a settlementby the buyer whether in whole or in part, of a debt owed by the seller and other indirect
payment for the seller by the buyer.
In principle, the price actually paid or payable shall not include the following charges
or costs, provided that they are distinguished from the price actually paid or payablefor the imported goods:
1) Charges for construction, erection, assembly, maintenance or technical assistanceundertaken after importation of the imported goods;
2) Transportation costs after importation;3) Duties and taxes imposed on the imported goods in Japan.
However, if the price actually paid or payable will not be able to be grasped by thewhole amount including the above costs, then it shall be the total amount including suchcosts.

(Q1-5) What is a case which is not able to calculate the Customs value of theimported goods based on the Primary method?
A: The Primary method cannot be applied in following cases: the goods are imported
without the import transaction; there are special circumstances such as conditions or
considerations on the import transaction; or there are any un-resolved doubts for the
Customs value of the imported goods.

(Q1-6) What kind of goods are considered as imported not by the importtransaction?
A: For example, the following goods are considered as imported without the importtransaction:- Free consignments (Examples: gifts, samples, promotional items);- Goods imported on consignment (Examples: goods imported by an assignee forsale by auction which is held in Japan, goods imported for sale by auction which is
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held in Customs bonded area and there is no sale between an exporter and an
importer for the goods);
Goods imported under a hire or leasing contract;
Goods imported by branches which are not separate legal entities;
Goods imported by a person or a company who does not have its domicile,
residence, headquarters, branch, office, or place of business or equivalentestablishment in Japan (hereinafter referred to as “non-resident”) as a buyer bysale and arrived at Japan;
Goods imported by a non-resident in order to sell in Japan after importation(Example: Goods imported by non-resident and declared by using Customs
manager system under Article 95 of Customs Law for sale through e-commerce
website which is run by a resident of Japan after importation (hereinafter referred
to as “e-commerce website”).
Concerning the importation by the non-resident, please kindly refer to the questions
in section 6 for more detail.

(Q1-7) In order to confirm the existence of import transaction, what kind of
documents or materials should be judged of?
A: A sales contract, invoice and other documents or materials which are able to verify thefacts of the transaction (for examples, purchase order, correspondences of thetransaction, relevant evidences of the sales price and resold information, etc.), can besources for the confirmation of the existence of import transaction. Please kindly notethat such materials shall be based on objective and quantifiable data and cannot be
used if the Customs has reasons to doubt the truth and accuracy of any statement on
the materials presented for Customs purposes.
2. The Identical or Similar goods value method（Article 4-2）
(Q2-1) In which case, the Identical or Similar goods value method (Article 4-2) canbe applied?
A: In case that the Customs value cannot be determined by using the method of thetransaction value of the import goods (Primary method), and if the transaction value ofthe Identical or Similar goods is able to confirm, then it is possible to use suchtransaction value for the Customs valuation of the imported goods.
For example, the Customs value of a free consignment which is imported asalternative of previously imported inferior goods shall be determined based on thetransaction value of the previously imported goods if the imported goods was imported
based on the sales and regarded as import transaction, exported on the same day or3within or in a month of the free consignment goods and produced in the same countryof the free consignment goods.
In case that the transaction value of the Identical or Similar goods cannot be identified,
the provisions of alternative methods under Article 4-3 or 4-4shall be used for the
calculation of the Customs value.
3. The Deductive value method (Paragraph 1, Article 4-3)
(Q3-1) In which case, the Deductive value method (Paragraph 1, Article 4-3) canbe applied?

A: In case that the Customs value cannot be determined by using the Primary method or
the Identical or Similar goods value method, then the Deductive value method can beused for Customs valuation purpose.
In case of using “the Deductive value method” for Customs valuation purpose, theCustoms value shall be the price deducting certain expenses from the domestic selling
price which is at the first commercial level after importation in Japan of the imported
goods or identical or similar goods (which should be limited produced in the same
country of the imported goods), at or within certain period of import declaration day, toa person/company as a seller in Japan who is not related to the buyer in Japan.
(Q3-2) What kind of expenses shall be deducted from the domestic selling price?
A: In case of using “the Deductive value method”, the following expenses shall be
deducted from the domestic selling price:・either the commissions usually paid or the additions usually made for profit andgeneral expenses in connection with sales in Japan of imported goods of the sameclass or kind;・the usual transportation and insurance costs and associated expenses incurred within
Japan;
・the Customs duties and other taxes imposed on the imported goods in Japan.
(Q3-3) What kind of price can be used as the domestic selling price under thismethod?
A: The domestic selling price to be used shall be satisfied the following conditions:- the domestic selling price which is sold on the earliest day either before/after one
month of the import declaration day or within 90 days from the import declarationday;-

the sale which was done by a seller in Japan and a buyer in Japan who has no
special relationship;4-

the sale which is at the first commercial level after importation in Japan;
the domestic selling price of the identical or similar goods which was produced in
the same country of the imported goods.

(Q3-4) In case that the domestic selling price is unknown at the time of the importdeclaration, how should the import declaration be made?
A: In case that the domestic selling price is unknown due to the import goods or identicalor similar goods has not been sold yet, the withdrawal system of the goods before an
import permission under Article 73 of the Customs Law, (hereinafter referred to as “BPsystem”) can be used. In case of using this system, the Customs value of the goods
withdrew into Japan should be calculated on the sales record of selling the imported
goods or identical or similar goods, then the Customs value should be confirmed under
Article 7-16 of the Customs Law (hereinafter referred to as “IBP”) .

(Q3-5) What kind of case can be considered under the Deductive value method(Paragraph 1, Article 4-3) cannot be used?
A: In case that the domestic selling price under which Q3-3 conditions are fulfilled cannot
be confirmed, then the Deductive value method cannot be used.
For example, if domestic selling price does not exist at the time of IBP of the imported
goods which is withdrawn into Japan by applying BP system or has not been fixed fora long period, it would be difficult to apply for the Deductive value method.

(Q3-6) Is it possible to use a tentative selling price or a quoting price as adomestic selling price under the Deductive value method?
A: The domestic selling price under Paragraph 1, Article 4-3 shall be the domestic selling
price which is sold on the earliest day either before/after one month of the importdeclaration day or within 90 days, such domestic sale done by a buyer and a seller inJapan who has no special relationship, at the first commercial level of the imported
goods or identical or similar goods. Therefore, it is necessary to use an actual selling
price, such tentative selling price or quoting price cannot be used as the domestic
selling price under Paragraph 1, Article 4-3.
4. The Computed value method (Paragraph 2, Article 4-3)
(Q4-1) What is the Computed value method all about?
A: ”The Computed value method” is to calculate the Customs value based on the cost of
producing of the imported goods by adding followings: an amount for profit and general5expenses equal to that usually reflected in sales of goods of the same class or kind as
the imported goods being valued which are made by producers in the country ofexportation for export to Japan;, transportation costs, and other associated expenses
to a port of importation.

(Q4-2) In which case the Computed value method can be applied?
A: In case that the Customs value cannot be determined by using the Primary method,the Identical or Similar goods value method or the Deductive value method, then theComputed value method shall be used for the Customs valuation purpose. If theimporter requested, it is possible to apply for the Computed value method prior to the
Deductive value method.
Please kindly note that “the Computed value method” is to be applied only the caseof that the imported goods arrive at Japan based on the transaction between theimporter (who is located in Japan) and the manufacturer of the imported goods.
Therefore, it is not possible to apply for the case, for examples, non-resident
purchases the goods from the manufacturer or transaction has been occurred between
the non-residents.

(Q4-3) What kind of materials should be confirmed for the cost of producing?
A: The cost of producing, profit and general expenses to be used for “the Computed value
method” shall be calculated based on the materials (in principle, commercial
accounting books of the manufacturer of the imported goods) submitted by the
manufacturer or submitted for the manufacturer.
5. The Fall-back method (Article 4-4)
(Q5-1) What is the Fall-back method all about?
A: The Fall-back method is stipulated under Article 1-12 of the Cabinet Order for
Enforcement of Customs Tariff Law and there are following two specific methods.
a) The price calculated with a reasonable adjustment of Articles 4 to 4-3 (Paragraph
1, Article 1-12, Cabinet Order for Enforcement of Customs Tariff Law)b) In case that a) is not applicable, the price calculated based on a method set by
the Director-General of the Customs, which is complied with Article VII of theGeneral Agreement on Tariffs and Trade 1994 and Agreement on Implementationof Article VII of the General Agreement on Tariffs and Trade 1994 (WTO Valuation
Agreement) (Paragraph 2, Article 1-12 of the Cabinet Order for the Enforcementof Customs Tariff Law).

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(Q5-2) What is the “reasonable adjustment” of Articles 4 to 4-3?
A: In case that the basic conditions are not satisfied of the Primary method, the Identicalor Similar value method, the Deductive value method or the Computed value method,
Customs value should be determined by using reasonable adjustment to such
unsatisfied conditions. The sequential order of Articles 4 to 4-3 shall also be appliedand determine the Customs value.
For example, if the domestic sale had been made on 120 days after the importdeclaration, not within 90 days, and there is no other satisfactory domestic selling
price, the domestic selling price of the 120 days can be used to calculate the Customs
value.

(Q5-3) What is the method set by the Director-General of the Customs?
A: It is a method based on the materials which is obtainable in Japan and is considered
as reasonable. Such evidence can be included submission by the importer but itshould be excluded if there is any doubt for the truth and the accuracy of suchmaterials in the judgement by the Director-General of the Customs.
6. Due attentions (the calculation of the Customs value of the imported goods
which are for sale through the e-commerce website)(Q6-1) Which method shall be applied to calculate the Customs value of theimported goods which are for sale through the e-commerce website?
A: It should be calculated based on the methods of the Customs valuation of the imported
goods, which are from the Primary method to the Fall-back method. Which methodshould be applied is depending on whether import transaction exists or not. Therefore,
please confirm the role of the importer and facts of the transaction such as person orcompany to be delivered or to be resold.
Please kindly note that for determining existence or nonexistence of an importtransaction, it should be taken into account not only by the contents of the importer’s
explanation (in written form) or attached documents of the import declaration, but also
the overall facts of the imported goods, including whether the such contents reflect theactual transaction accurately or not.

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(Q6-2) In case that an importer asks a customs broker to take an import clearance
procedure on his/her behalf, how should the customs broker make theimport declaration when existence of the import transaction or detail of thetransaction of the imported goods is unknown?
A: An applicable method of the Customs valuation depends on whether it exists animport transaction between a seller and a buyer of the imported goods or not. First,
please confirm a role of importer such as a buyer, Customs manager under Article 95
of Customs Law as a proxy of non-resident. Also please confirm a place and aperson/company to deliver or to resale after importation. Otherwise, it may not be
possible to make an import declaration with a correct price.
Furthermore, prior to file an import declaration, please make sure to obtain therelevant and necessary information to calculate the Customs value and evidence forsuch calculation.

(Q6-3) When the imported goods will be sold through the e-commerce website,
is it possible to use an invoice price for an import declaration for Customs
valuation purpose?
A: In case that the import transaction exists and Primary method for the Customs
valuation purpose is applicable, it is possible to determine the Customs value basedon the invoice price as far as the invoice price correctly represents the price of theimport transaction and conditions of such transaction.
For example, when a person/company located in Japan ordered the goods as abuyer, and the goods shipped from the seller who received the order from the buyer
and arrived at Japan, it is considered there is an import transaction and Customs value
shall be calculated based on the invoice price if the invoice price represents the correct
price of the transaction,.

(Q6-4) How shall the Customs value be calculated if a non-resident imports the
goods in order to sell them through the e-commerce website?
A: In case that a seller of the e-commerce website is a non-resident and the goods
imports to Japan without a sale between seller in export or producing country and abuyer located in Japan, there is no import transaction and the Primary method is notapplicable to calculate the Customs value.
If the Primary method is not applicable, the following alternative methods shall beapplied in sequential order:
・the Identical or Similar goods value method (Article 4-2)・the Deductive value method (Paragraph 1, Article 4-3)
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・the Computed value method (Paragraph 2, Article 4-3)・the Fall-back method (Article 4-4)

(Q6-5) In case that the imported goods are sold through the e-commerce website
by a non-resident, how shall the Customs value be calculated by using a
specific method under the Fall-back method which is set by the DirectorGeneral of the Customs?
A: When the specific method set by the Director-General of the Customs under the Fallback method, Article 4-4 shall be applied, such as importer wishes to make the importdeclaration by the general procedure (not using the BP system) but there is nodomestic sale, the Customs value shall be calculated based on the materials submitted
to the Customs for import declaration which is considered as objective and reasonablemeans.
For example, the Customs value can be calculated based on an estimated price of
the identical or similar goods on the e-commerce website by recognizing the estimatedprice as deemed domestic selling price. In this case, the expenses of the domestic
costs which are surely confirmed as accurate after arrival in Japan and the Customs
duties and taxes at the importation shall be deducted.

(Q6-6) In case of applying a method set by the Director-General of the Customs,
what kind of materials should be submitted to the Customs?
A: The materials to be used for the calculation of the Customs value should be based on
the objective and reasonable source and truly and accurately indicate the amount thatis to be used as the basis of calculation of the Customs value and circumstances of
the transaction. Therefore, materials which are simple lists of domestic sales and aseries of domestic costs made by an exporter is not sufficient enough as objective andreasonable source of evidence.
If the Customs requests to submit materials of a domestic selling price or domestictransportation costs, please submit materials which verify the domestic selling price on
the e-commerce website and an actual invoice to a vender, of which clearly indicatessuch domestic transportation costs.

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(Q6-7) In case that the Customs value shall be calculated based on the estimatedprice by applying a method set by the Director-General of the Customs, howshould domestic transportation costs to be handled if the delivery place or
person/company is unknown, and the costs have not been fixed yet?
A: Although the domestic transportation costs depend on the delivery place, it is possible
to deduct a minimum domestic transportation cost from the Customs value when therange of the domestic transportation costs are fixed and importer can submit an
objective and reasonable source of evidence.
7. Others(Q7-1) At the import declaration, is it necessary to submit a value declaration
form and/or materials for the calculation of the Customs value to theCustoms?
A: In case that the Customs value shall be determined under Article 4-2 or the Articles
following it is necessary to submit a value declaration form except when the imported
goods are duty free or specific duty goods item or the total amount of the Customs
value is less than 1 million yen.
However, in case of calculating the Customs value under Article 4-4, please submit
materials to show the process of the calculation of the Customs value and their sources.

(Q7-2) In case that an invoice is a proforma invoice or a domestic selling price ordomestic transportation costs to be deducted is unfixed/unknown andtaking long time to determine the Customs value, is it possible to apply
the BP system?
A: If there is no particular issue for withdrawal of the imported goods other than the
Customs value at the time of import declaration, then it is possible to apply for BP
system and withdraw the imported goods into Japan.
For application of the BP system, it is necessary to provide a guarantee (depositionof the cash to the Legal Affairs Bureau holding jurisdiction over the bonded area where
the imported goods are stored, etc.) before withdrawal of the goods.
For more detail concerning the application BP system or prior consultation of the
Customs valuation, please contact to the Customs where the import declaration to be
made.

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(Q7-3) How shall the amount of the deposit on BP system be calculated?
A: The amount of the deposit on the BP system which is necessary to provide at theapplication is the same amount of the declared duty/tax if there is no particular issue
for the declared duty/tax amount. Other than that, in principle, 10% is added to thedeclared duty/tax amount. In case that the difference between the declared duty/tax
and the correct duty/tax is clearly beyond 10%, the amount of the deposit should be
the same amount of such correct duty/tax. The specific deposit amount of each caseshould be decided at the Customs where import declaration to be made.
For example, like Q7-2, invoice is a proforma invoice or a domestic selling price ordomestic transportation costs to be deducted is unfixed/unknown, please consult at
the Customs where the import declaration to be made.

(Q7-4) Is it necessary to correct the declaration of the imported goods if theimporter finds miscalculation of the Customs value after the importpermission?
A: If the importer finds the miscalculation of the Customs value of the imported goods
and is sure that the existence of underpayment of duties/taxes, please make correctionof declaration with necessary materials to calculate the Customs value at the Customs
where the import declaration was made.

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