HQ 0543912 - Internal Advice No. 47/86 - United States International Trade Commision Rulings

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HQ 543912

April 19, 1988

CLA-2 CO:R:CV:V 543912 EK

CATEGORY: VALUATION

Area Director of Customs
New York Seaport, New York

RE: Internal Advice No. 47/86

Dear Sir:

This is in reference to an internal advice request initiated through counsel, on behalf of a certain importer.

There are 13 entries which are unliquidated. In addition, there are 49 entries which are subject to claims for reliquidation pursuant to section 520(c)(1) of the Tariff Act of 1930. The importer claims that all the entries are subject to appraisement pursuant to deductive value, section 402(d) of the Tariff Act of 1930, as amended by the Trade Agreements Act of 1979 (TAA; 19 U.S.C. 1401a(d)).

This internal advice response will only address the valuation of the unliquidated entries.

The merchandise consists of baseball caps and baseballs. It was determined that transaction value pursuant to section 402(b) was not applicable since the price of the merchandise was effected by the relationship between the parties.

With respect to the baseball caps, an audit to determine the feasibility of deductive value was conducted. The auditors determined that adequate documentation was not available to substantiate the deductive value data submitted. The audit was suspended, and it was subsequently determined that a transaction value of identical or similar merchandise pursuant to section 402(c) was available, thereby eliminating the necessity to obtain further substantiation of the deductive value information.

No specific information pertaining to the claimed section 402(c), transaction value of identical or similar merchandise appraisement, has been submitted to Headquarters. If in fact a section 402(c) appraisement is available, then neither Customs nor the importer have the authority to disregard it and appraisement under this provision would be appropriate.

If transaction value and transaction value of identical or similar merchandise cannot be determined, then the customs value will be based upon deductive value, unless the importer has elected computed value. With respect to the instant situation, nothing in the submitted material demonstrates that the importer has elected the application of computed value before deductive value.

Counsel for the importer has agreed to provide to the appraising officer the documentation necessary to appraise the merchandise pursuant to deductive value. Upon receipt of the necessary information, and assuming it meets the statutory requirements of deductive value pursuant to section 402(d), then appraisement pursuant to that section is proper.

Regarding the appraisement of the baseballs, although no claim has been made that a transaction value of identical or similar merchandise pursuant to section 402(c) exists, it is Customs position that the documentation with respect to deductive value has not been substantiated. Again, as indicated above, counsel has agreed to supply the necessary information. Subsequent to receipt of the documentation, and assuming it meets the statutory requirements of deductive value pursuant to section 402(d), then appraisement of the baseballs pursuant to deductive value is proper as well.

Sincerely,

John Durant

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