Customs valuation fraud risks indicators

Row material price vs invoice

The unit price of the commodities is lower than price of the raw material

Invoice issued by seller based in third countrySeller premises in an apartment Unusual (standards) invoice formatLack of usual elements on the invoice (i.g.

company logo, address

Goods exported form producer sold by third party

Goods exported form Korea . Goods sold by USA trader

Risk indicators:

Wrong model of refrigerator Invoice from USA seller (other than the regular distributor)Seller premises in an apartment Unusual invoice formatLacking of usual elements on the invoice (company logo,

address)

Cyprus /Dubai

Goods produced in China sold by seller in Cyprus to the country of importation. Goods originally sold from producer to distributor in Dubai

Risk indicators:

Invoice for seller in CyprusLacking of usual elements on the invoice (i.g.

payment terms, company logo, address) Transport cost paid on Dubai account

Goods origin China sold by seller based on Marshall Island. Goods originally sold from producer to distributor in Dubai; goods transported directly from China to the country of importation

Risk indicators:

Invoice for seller in Marshall IslandsSame price for different commodities Mistake in the spelling of Marshall IslandsUnit price lower than same commodity declared in the country of

importationUnusual invoice formatLacking of usual elements on the invoice (payment terms, company

logo, address)

China/Marshall Islands/Dubai

British Virgin IslandsGoods produced in China sold by seller in Cyprus to country of

importation. Goods originally sold from producer to distributor in Dubai; goods delivered directly form China to the country of importation (Certificate of Origin)

Risk indicators:

Invoice for seller in British Virgin IslandsInvoice number identical to the number on the Certificate of

origin although invoice issued by different consigneePayment in Latvia Unusual invoice formatLacking of usual elements on the invoice (e.g. payment terms,

company logo, address

USA Apartment

Goods experted from Korea the country of importation. Seller based in USA

Risk indicators:Invoice from USA sellerSeller premises in an apartment Different prices for same commodities (by period of

the year and by importer)Unusual invoice formatLacking of usual elements on the invoice (company

logo, address)

Airsoft guns Seller offers reduction of price upon buyer

order on his webpageGoods originally paid in USD Invoice issued in HKD

Fake Commissioner – undervaluation, avoiding AD dutiesCompanies offering ocmplete service on

internet

What to do?In case of risk indicators do not release goods into

the free circulationThe goods should be properly documented, customs

debt granted and upon consideration of the risks goods increased by possible fine (usually +10 -15% of the price) may be hand over to importer (or not – consider the risks!) if not – temporary storage treatment

The investigation – collection of proves, more docs, interviews, potential international cooperation with the customs from the countries involved

When proves are available – refuse transaction value

Questions?