Odessa customs approves customs value for fertilizer importer
Subject of complaint: Odesa Customs of the State Fiscal Service (Odessa Customs)
Complaint in brief: A company with German investments, importer and wholesaler of fertilizers in Ukraine, appealed to the Council. The Complainant disagreed with the customs value adjustment of imported goods by the Odesa Customs.
In 2018-2019, the company imported fertilizers worth over UAH 70 mn and paid nearly UAH 500 in taxes and fees with respect to these transactions. Fertilizers supplies were made under a direct contract from a foreign producer, while a separate specification – an annex to the contract – was drawn up for each batch of goods. Specification texts varied only in delivery/payment terms and the price of goods. Identical packages of documents were provided for customs clearance during each delivery.
In cases when the price of imported goods went up, customs officers did not have any remarks on the documents. But when the price started to fall due to the appreciation of hryvnia, customs officials began finding “differences” in documents and adjusted prices, increasing the cost of imports. In this case, the highest delivery cost according to the specification under the contract was considered a “standard”. Examples of “differences “provided by the Complainant were: visual difference of counterparty signatures on documents, paying for goods a few days later.
The company imported its goods through four different checkpoints, but the same problem occurred in every checkpoint. Customs officers did not recognize the price stated in the specification, and adjusted it to the higher side. The company noted that in all of those cases, customs did not have legitimate reasons for requiring additional documents other than those submitted by the company together with the Electornic Customs Declaration, since the documents fully confirmed numerical values declared by the importer.
Actions taken: After examining the appeals, the Council’s investigator participated in a tripartite meeting with the tax and company representatives. The customs officers analyzed the documents submitted by the complainant before the customs clearance, articulated their remarks and clarified the points at issue. The company’s representatives expressed their willingness to provide all necessary documents. The reached agreements and arguments in favor of the Complainant were outlined by the Council in a letter to the SFS.
Result achieved: Odesa Customs accepted the Council’s arguments and canceled the decision on customs value adjustment. The case was closed successfully.