information on IMPLEMENTATION and administration

of the agreement on customs valuation

Check-list of Issues

Maldives

The following communication, dated 21 July 2024, is being circulated at the request of the delegation of the Maldives.

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1._           Questions concerning Article 1:

(a)_         Sales between related persons:

(i)_          Are sales between related persons subject to special provisions?

Sales between related person are subjected to the provision Article 151 (Accepting the transaction value as the customs value) of Customs General Regulation.

Article 149 of the said regulation emphasizes that "for all Customs purposes the value of the goods shall be determined in accordance with the relevant section of the WTO Agreement on the implementation of Article VII of the General Agreement on Tariff and Trade 1994".

(ii)_         Is the fact of intercompany prices prima facie considered as grounds for regarding the respective prices as being influenced?

Transactions between two companies are treated as related in case the nature of transaction comes within the scope of related persons defined under Customs General Regulation Article 151 (C) (4) which correspond to Article 15 paragraph 4 of the agreement.

(iii)_       What is the provision for giving the communication of the afore-mentioned grounds in writing if the importer so requests? (Article 1.2(a))

Under Customs General Regulation article 154 (Direction of action if the transaction value declared is suspected to be false) Customs may choose not to accept the transaction value declared as the customs value.

Based on the provisions of Decision 6.1 of the agreement on Implementation of Article VII Customs sends a notification to the importer requesting for an explanation. In the absence of explanation or in case where customs have doubt regarding the truth or accuracy of the declared value or documents furnished, assessing officers have the discretion to reject the transaction value. An electronic message is delivered as a notification with reason why the transaction value was rejected.

Moreover, a written explanation shall be provided from Customs to the importer, upon request in writing for justification regarding the valuation decision to Customs as per Customs General Regulation Article 158.

(iv)_        How has Article 1.2(b) been implemented?

Maldives Customs maintains a valuation database, where all the imported goods data are stored and made readily available to all the assessing officers. Therefore, the assessing officers valuate goods using the valuation database with application of article 1.2 (b) as per Customs General Regulation 153 & 156.

(b)_         Price of lost or damaged goods:

            Are there any special provisions or practical arrangements concerning the valuation of lost or damaged goods?

The valuation of goods will be in accordance of Customs General Regulation article 149-159 in accordance with the relevant sections of the WTO "Agreement on implementation of Article VII of the general agreement on Tariff and Trade".

There are special provisions in Customs General Regulation concerning the payment of duty on lost, damages or deteriorated, destroyed or abandoned. The following are the extracts as quoted in Customs General Regulation.

1)_    Duty payment for Neglected Goods, lost or damaged due to Custodians negligence (Article 45-48)

2)_    Auction Goods (Article 418, 420)

3)_    Disposing Goods (Article 421, 423, 425 to 430)

4)_    Damaged Goods (Article 126, 140, 194, 262, 269, 270, 286, 296)

Goods which are imported in damaged condition are valuated in accordance with the relevant sections of the WTO "Agreement on implementation of Article VII of the general agreement on Tariff and Trade" as per Customs General Regulation Article 149-159.

2._           How has the provision of Article 4 to allow the importer an opinion to reverse the order of application of Articles 5 and 6 been implemented?

Article 153 (b), Customs provide the importer to designate their preferred method of valuation from among the two methods Article 5 & 6 and if such request is made the two valuation methods will be reversed when determining the customs value.

3._           How has Article 5.2 been implemented?

Article 153 (a) (3) provides the provision for valuation of goods based on Deductive Value method.

4._           How has Article 6.2 been implemented?

Article 153 (a) (4) provides the provision for valuation of goods based on Computed Value method.

5._           Questions concerning Article 7:

(a)_         What provisions have been made for making value determinations pursuant to Article 7?

Customs general regulation Article 153 (a) (5) incorporates the provisions of Article 7 of the Agreement. Adopting article 7 in accordance with the relevant sections of the WTO "Agreement on implementation of Article VII of the general agreement on Tariff and Trade".

(b)_         What is the provision for informing the importer of the customs value determined under Article 7?

Based on the provisions of Decision 6.1 of the agreement on Implementation of Article VII Customs sends a notification to the importer requesting for an explanation. In the absence of explanation or in case where customs have doubt regarding the truth or accuracy of the declared value or documents furnished, assessing officers have the discretion to reject the transaction value. An electronic message is delivered as a notification with reason why the transaction value was rejected.

Moreover, a written explanation shall be provided from Customs to the importer, upon request in writing for justification regarding the valuation decision to Customs as per Customs General Regulation Article 158.

(c)_         Are the prohibitions found in Article 7.2 delineated?

It is not delineated in Customs General Regulation. Article 149 stipulates that for all Customs purposes, the value of the goods shall be determined in accordance with the relevant Sections of the World Trade Organization (WTO)'s "Agreement on Implementation of Article VII of the General Agreement on Tariff and Trade 1994)".

6._           How have the options found in Article 8.2 been handled? In the case of f.o.b. application, are ex-factory prices also accepted?

Yes, Ex-Factory prices are also accepted with a breakdown of inland freight or Ex-Works Charges and charges concerning article 8.2 (a) and (c) are obtained for statistical purposes.

7._           Where is the rate of exchange published, as required by Article 9.1?

Foreign currency conversion rates are decided by Customs by consulting with the Ministry of Finance and Treasury and the Maldives Monetary Authority. These Currency conversion rates for each month is duly published at the beginning of each month and readily available on Customs Website as well (Customs General Regulation Article 114 (c).

8._           What steps have been taken to ensure confidentiality, as required by Article 10?

In Customs Act, 2011 Article 23 is the provision for ensuring confidentiality. Furthermore, there are adequate provisions in Customs General Regulation to implement confidentiality in practice. Extract of Article 23 of the Act is given below.

"(a) No employee of the Customs shall reveal any official document or a classified document, or confidential information, or information known to him by virtue of his office, to any person other than the person to whom such information was intended to.

(b) Without prejudice to subsection (a) information may be disclosed when required by law."

9._           Questions Concerning Article 11:

(a)_         What rights of appeal are open to the importer or any other person?

Importer or his representative is given numerous attempts to request for appeal. Initially at section level before payment of duty, secondly to Customs Valuation Committee (Customs General Regulation Article 158 (whether or not after payment of duty)), third to Customs Minister (Customs Act Article 108) and fourth to a court of Law (Customs Act Article 108).

(b)_         How is he to be informed of his right to further appeal?

At the initial level, the communication is established in ASYCUDA World declaration. In other cases, a written explanation is provided regarding the valuation decision taken and the rights of importer are stipulated in Customs Act and General Regulation. For further clarifications the importer or his representative is welcome to contact the Secretariat section regarding their queries.

10._         Provide information on the publication, as required by Article 12, of:

(a)      

(i)_          The relevant national laws;

Customs Act, 2011 stipulates on how the price will be determined.

(ii)_         The regulations concerning the application of the Agreement;

Customs General Regulation Article 149 to 159 are the articles concerning the application of Agreement on Customs Valuation in Maldives.

(iii)_       The judicial decision and administrative rulings of general application relating to the Agreement;

Article 452 of the Customs General Regulation states that it is a responsibility of the valuation committee to upload the information about "Agreement on Implementation of Article VII of the General Agreement on Tariff and Trade" of World Trade Organization (WTO) and decision taken under this agreement and, arrange a mechanism to keep that information in Customs in an accessible manner.

Judicial decisions are published on the website of the respective court pursuant to the Article 71 (c) of the Judicature Act).

(iv)_        General or specific laws being referred to in the rules of implementation or application.

Under Customs Act, 2011 the obligation to make rules regarding the Customs Valuation is entrusted to Customs Valuation Committee members.

Part 5 of the Customs General Regulation states the rules of implementation and application. Article 453(a) of Customs General Regulation states, Valuation Committee Conduct works needed to enhance the price valuation of goods that are imported and exported to and from the Maldives and amend the required regulations and procedures.

(b)_         Is the publication of further rules anticipated? Which topics would they cover?

No.

11._         Questions concerning Article 13:

(a)       How is the obligation of Article 13 (last sentence) being dealt with in the respective legislation?

Customs General Regulation Article 155 (Releasing goods when more time is needed to determine customs value). Customs allows the release of goods after the importer pays the duties to Customs based on the provisional value assigned by Customs for the goods. The duty paid for the provisional value is considered as form of surety.

(b)       Have additional explanations been laid down?

Customs General Regulation Article 155 provides a comprehensive explanation on how the Procedure shall be conducted. Therefore, no further explanations are provided other than that as stated above.

12._         Questions concerning Article 16:

(a)       Does the respective national legislation contain a provision requiring customs authorities to give an explanation in writing as to how the customs value was determined?

Yes. Customs General Regulation Article 158 stipulates that a written explanation shall be provided from Customs to the importer, upon request in writing for justification regarding the valuation decision made by Customs.

(b)      Are there any further regulations concerning an above-mentioned request?

No.

13._         How have the Interpretative Notes of the Agreement been included?

As per Customs Act and Regulation, for all Customs purposes, the value of goods is being determined in accordance with the relevant sections of the WTO "Agreement on Implementation of Article VII of the General Agreement on Tariff and Trade 1994)".

Hence, the interpretative notes to the agreement are considered as relevant sections of the agreement.

14._         How have the provisions of the Decision on the Treatment of Interest Charges in the Customs Value of Imported Goods been implemented?

The WTO Decision 3.1 as it is, is deemed as an equally authoritative part of Customs general regulation and shall be executed in implementing the provisions of the Customs Act and the Regulation.

15._         For those countries applying paragraph 2 of the Decision on the Valuation of Carrier Media Bearing Software for Data Processing Equipment, how have the provisions of this paragraph been implemented?

From the two methods on appraising goods such as programs and software proposed in the Decision number 4.1 made under the WTO Valuation Agreement, the method that shall be applied in the Maldives is to value the price of the goods inclusive of the price of the associated program or software.

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