Customs Valuation and Transfer Pricing

Dear Friends,

We are writing to let you know that the International Chamber of Commerce (ICC) recently released its 2015 Policy Statement on Transfer Pricing and Customs Valuation.  The Policy, which is produced by the ICC Commission on Taxation and the ICC Commission on Customs and Trade Facilitation, is worth a quick read and can be found here.

The Policy attempts to further the effort to harmonize transfer pricing and customs valuation methodologies.  It is aimed primarily at national customs administrations and includes a number of proposals to help with the harmonization effort.  For example, the Policy recommends that, when multinational enterprises set their intercompany transfer prices pursuant to recognized arm’s length transfer pricing principles (e.g., the OECD Transfer Pricing Guidelines, 26 U.S.C. §482 in the United States, etc.), national customs administrations should accept that as evidence that the relationship between the parties did not influence the price.  It also includes recommendations regarding the acceptance of upward and downward transfer price adjustments for customs purposes, how those adjustments should be reported, etc.  The Policy is going to be included in the World Customs Organization training package on customs valuation that will be provided to national customs administrations later this year.

The intersection of transfer pricing and customs valuation is an issue many multinational enterprises struggle with around the world.  The publication and distribution of the ICC Policy will likely serve to raise the profile of these issues even further.  It is, therefore, important that every company that uses an intercompany transfer price for customs purposes have (1) documentation explaining how the intercompany transfer prices are acceptable customs values, and (2) a plan for confirming whether any retroactive transfer price adjustments are made and, if so, are addressed for customs purposes.  We regularly deal with these issues in the United States and elsewhere and would be happy to discuss our experience, and how it can help, with you further.  If you’d like to do so, please let me know.

Best regards,



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