HQ 545574 - Application for Further Review of Protest No. 5201-93-102081; Price Actually Paid or Payable; Applicable Exchange Rate for Currency Conversion; 19 USC 1401a(b); 19 CFR 152 and 159 - United States International Trade Commision Rulings

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HQ 545574

October 12, 1994

VAL CO:R:C:V 545574 LPF

CATEGORY: VALUATION

District Director
U.S. Customs Service
P.O. Box 025280
6601 NW 25th Street
Miami, FL 33102-5280

RE: Application for Further Review of Protest No. 5201-93-102081; Price Actually Paid or Payable; Applicable Exchange Rate for Currency Conversion; 19 USC 1401a(b); 19 CFR 152 and 159

Dear Madam:

This is a decision on an application for further review of a protest filed December 3, 1993, against your decision concerning the appraisement of a motor yacht. The entry was liquidated on September 17, 1993. We regret the delay in responding.

FACTS:

On January 22, 1993, a motor yacht, known as the Gallant Lady, was imported by Southeast Toyota Distributors, Inc. at Miami, FL. The file contains an agreement, dated March 20, 1990, between Southeast Toyota Distributors, Inc. ("importer"), of Deerfield Beach, FL, and De Vries Scheepsbouw B.V. ("seller"), of the Netherlands, concerning the manufacture and sale of the motor yacht. The agreement provides a contract price, in Dutch guilders, to be paid to the seller by the importer for the yacht in seven installments corresponding to different stages of the yacht's construction.

The file also includes invoices from the seller to the importer, as well as confirmation of the importer's payments, concerning most of the seven installments made between March 1990 and July 1992. A final invoice, dated August 6, 1992, reflects the charge for the full contract price, in Dutch guilders, as provided in the original agreement. An attached payment schedule reflects a value of the merchandise, in U.S. dollars, based on the exchange rate applicable on the date of payment of each installment. It is our understanding that the date of exportation of the yacht was July 24, 1992.

It appears that both parties are in agreement as to the price actually paid or payable for the yacht in Dutch guilders. However, the protestant submits that the value of the yacht, in U.S. dollars, is properly based on the exchange rate applicable on the date of payment of each installment. You appraised the yacht based on the exchange rate applicable on the date of exportation.

ISSUE:

Whether the transaction value of the yacht, in U.S. dollars, is properly based on the exchange rate applicable on the date of payment of each installment or the exchange rate applicable on the date of exportation.

LAW AND ANALYSIS:

As you are aware, the preferred method of appraisement is transaction value pursuant to section 402(b) of the Tariff Act of 1930, as amended by the Trade Agreements Act of 1979 (TAA), codified at 19 U.S.C. 1401a. Section 402(b)(1) of the TAA provides, in pertinent part, that the transaction value of imported merchandise is the "price actually paid or payable for the merchandise when sold for exportation to the United States" plus enumerated statutory additions.

Section 152.1(c), Customs Regulations (19 CFR 152.1(c)) provides that the date of exportation or time of exportation referred to in section 402 of the TAA, means the actual date the merchandise finally leaves the country of exportation for the United States. Moreover, section 159.32, Customs Regulations (19 CFR 159.32) provides that the date of exportation for currency conversion shall be fixed in accordance with section 152.1(c).

Based on the information provided, the merchandise at issue was exported on July 24, 1992, from the Netherlands to the U.S. Accordingly, it follows in accordance with the above referenced regulations, that the currency conversion from Dutch guilders to U.S. dollars is appropriately based on the exchange rate applicable on July 24, 1992.

HOLDING:

The transaction value of the yacht, in U.S. dollars, is properly based on the exchange rate applicable on the date of its exportation from the Netherlands to the U.S.

You are directed to deny this protest. A copy of this decision with the Form 19 should be sent to the protestant.

In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision, the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS, and to the public via the Diskette Subscription Service, the Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director

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