Case on adjustment of customs value

In the summer of 2019, our client imported goods from China, but Dnipro Customs disagreed with the declared value, pricing the goods at twice the price, resulting in the importer overpaying taxes by $10,000. We know from experience that such situations are not uncommon, and the price of imported goods determined by customs is often at least half the actual value.

On behalf of our client, attorney Anatoly Zadnipriany filed a claim with the administrative court to declare the customs actions unlawful and demand that the decision to adjust the customs value of the goods be overturned.

By decision No. 160/9479/19 of December 21, 2019, the Dnipropetrovsk District Administrative Court upheld the claim, but Dnipro Customs filed an appeal.

And so, at the end of April, a ruling was published in the Unified Register of Court Decisions, in which the Third Administrative Court of Appeal upheld the first-instance court’s decision.

We asked Anatoly Zadnipriany to provide a brief commentary on the nuances of such cases for our website.

“Importers typically encounter problems due to poorly prepared documents used to import goods, and most such disputes with customs authorities can be prevented. For example, in our case, the contract did not quite correctly define the delivery terms, which led to a question about whether the insurance amount should be included in the price of the goods. There were also a number of other defects in the documentation related to the delivery. While most of these customs nitpicks can be rebutted in court, it is cheaper and safer to avoid them and have the documents prepared by professionals.

Another general recommendation in such a dispute is to obtain evidence confirming that the value of the goods in the contract is correctly determined before going to court, as the court must base its decision on something. A strong piece of evidence in the client’s favor is a report from the State Enterprise Gosvneshinform or the Chamber of Commerce and Industry of Ukraine. “They provide this service on an ongoing basis, and you can obtain such a conclusion quite quickly,” commented Anatoly Zadnipryanny.