Method 6 - Fallback method
Source: gov.uk (2025-06-25)

Information about method 6, fallback method.

Basic principles

The customs value is based on the flexible application of Methods 1 to 5 as noted in Regulation 126 CIDEER (https://www.legislation.gov.uk/uksi/2018/1248/regulation/126/made). An example of goods an importer may encounter under this method are ‘no charge’ or ‘free of charge’ items. This is the method of last resort which is to be used only when the preceding methods of valuation cannot be applied.

The value must be determined on the basis of information which is available in the UK using any reasonable means consistent with the valuation provisions of legislation and the WTO instrument on which they were based.

The value must not be based on any of a proscribed list of values (see constraints below).

The value should be based on one of the preceding methods of valuation applied with appropriate flexibility and, wherever possible, on previously determined customs values.

Constraints

No customs value is to be determined on the basis of:
- the selling price in the UK of goods produced in the UK
- a system which provides for the acceptance for customs purposes of the higher of two alternative values
- the price of the goods on the domestic market of the country of exportation
- the cost of production, other than computed values which have been determined for identical or similar goods in accordance with Method 5
- prices for export to a country not forming part of the customs territory of the UK
- minimum customs values
- arbitrary or fictitious values
Some flexibilities that can be applied, but not limited to, while using Method 6 are:
- identical goods – the condition that the identical goods should be imported at the time of, or within a reasonable time period of the goods being valued could be flexibly interpreted; identical imported goods produced in a country other than the country of exportation of the goods being valued could be the basis for customs valuation
- similar goods – the condition that the similar goods should be imported at the time of, or within a reasonable time period of the goods being valued could be flexibly interpreted; similar imported goods produced in a country other than the country of exportation of the goods being valued could be the basis for customs valuation
- the deductive method - the 90 days condition could be used flexibly
Method 6 practical examples

Example 1

Scenario

Importer A bought a one-of-a-kind painting in 1980 in a third country and is now importing the painting into the UK to be hung in a gallery. At the time of import there is no sale of the painting, however the painting has increased in value since Importer A bought it.

Valuation treatment

Method 1 cannot be used to value the painting as at the time of import there is no sale on which to base a transactional value.

Method 2 cannot be used to value the painting as it is a one-of-a-kind piece of artwork and therefore there are no identical goods that have been imported under an accepted Method 1 valuation at the time of, or within a reasonable time period of the painting’s importation.

Method 3 cannot be used as the importer has not imported any similar paintings under an accepted Method 1 valuation at the time of, or within a reasonable time period of the painting’s importation.

Method 4 cannot be used as the painting has not been sold.

Method 5 cannot be used as the importer does not have access to the required in-depth information needed for this method, such as production costs, profit etc.

Method 6 must therefore be used to value the painting. In order to arrive at a reasonable valuation for the painting Importer A gets the painting valued by an art expert who values the painting at £500,000. Along with the usual additions and deductions, this value is then used as a flexible Method 1 value on the import declaration.

Example 2

Scenario

Company A is a UK based events company who run a cheese competition within the UK. They import ‘samples’ of cheese from suppliers throughout Europe for judging purposes for the cheese competition. Company A does not pay the suppliers for the samples; however, the suppliers pay a small entry fee for the competition and pay for the cheese to be transported to the UK. Any cheese leftover from the event is disposed of without profit. The majority of the cheeses they receive are not already available within the UK.

Valuation treatment

Method 1 cannot be used as there is no sale of the goods from the suppliers to Company A and there is no transaction value as Company A does not pay the suppliers for the goods.

Methods 2 and 3 cannot be used as Company A does not import any other goods into the UK and therefore there is no Method 1 transaction value for similar or identical goods that they themselves have imported, or a comparable Method 1 transaction at the time of, or within a reasonable time period of the intended importation to base the value on.

For a Method 4 valuation the customs value is based on the unit price as sold in the UK, in the condition as imported, to customers unrelated to the seller in the greatest aggregate quantity. As Company A are not involved in the trade of goods, they would not have access to the required information, such as invoices to wholesalers and supermarkets, in order to determine the greatest aggregate quantity or make the deductions needed to reach the correct value. Therefore, Method 4 cannot be used.

For a Method 5 valuation in-depth information, such as commercial accounts, profit, general expenses and costs of production, is required. As Company A does not produce these cheeses themselves and they are not a related company to that of their suppliers they would be unable to provide the information required for a Method 5 valuation, as such Method 5 cannot be used.

Method 6 is the fall-back method and allows for a flexible use of the earlier methods determined using reasonable means consistent with the principles and general provisions of the Agreement and of Article VII of General Agreement on Tariffs and Trade. In order to reach a value, the methods must be worked through again in order. Based upon the information provided and the circumstances of the import, a flexible Method 1 would be suitable for the circumstances, based on the price that Company A would pay if the goods had been bought in the ordinary course of trade, this being the price paid or payable for the goods. Company A would need to evidence this to HMRC, for example through the use of a commercial price list.