Text XI

Pre-reading

Task1. You are given a word family including the word “valuation”. Use a dictionary and translate the words constituting this word family.

valuable, valuables, valuation, value, to value, value-added tax, valueless, valuer

Task 2. Translate the following adjectives.

English Russian

major …

… международный

multilateral …

bilateral …

… единый

… идентичный

… подобный

primary …

Task 3. Look up the pronunciation of the following words in the dictionary:

hierarchy, transaction, deductive, computed, residual, negotiations

Task 4. Match the words/phrases on the left with their definitions on the right.

1. valuation a) official discussions

2. assessment b) an official document that people sign to show that they have agreed to something

3. licence (Br.E.) c) a calculation about the cost of something

= license (Am.E)

4. negotiations d) a business deal or action

5. transaction e) a professional judgment about how much something is worth

6. agreement f) an official document giving you permission to do something for a period of time

Customs valuation

Customs valuation is a major feature of modern customs tariff systems. It is important for the assessment of customs duties as well as it is a significant part in a variety of other aspects of international trade such as statistics, quota, licensing arrangements, taxes and other charges levied at importation.

Customs valuation and certain valuation practices came under study at the Tokyo Round of multilateral trade negotiations which took place between 1973 and 1979 within GATT in Geneva. One of the results of the negotiations was the adoption of the Agreement on the Implementation of Article VII of the General Agreement on Tariffs and Trade (GATT), which established a system of customs valuation.

The Agreement, which entered into force on 1 January 1981, is intended to provide a fair, uniform and neutral system for the valuation of goods for customs purposes. It provides a set of valuation rules.

Hierarchy of Valuation Methods

There are six methods of valuation applicable to all goods, namely:

- transaction value method;

- transaction value of identical goods;

- transaction value of similar goods;

- deductive method;

- computed method;

- residual valuation provision.

Transaction value method

The primary method of valuation is the transaction value which uses the invoice price. Wherever possible this is the method to be used.

The transaction value is defined as the price actually paid or payable for the goods being imported. This price is understood as the total payment made or to be made by the buyer to the seller for the imported goods and includes all possible payments made as a condition of sale of imported goods.

Only when the transaction value method cannot be used should the other methods be considered. In such cases the customs value is determined by proceeding sequentially through the other methods. It is only when the value cannot be determined under the provisions of an earlier method in the sequence that the provisions of the next method are invoked.

Other methods of valuation

The majority of importations will fall to be valued under the transaction value method. However, where there is no price actually paid or payable then the transaction value method cannot be used. Then the next sequential method of valuation, the “identical goods” method, is to be applied. In this case in establishing a customs value the deductive method cannot be used.

In exceptional circumstances it may not be possible to determine the customs value of imported goods under any of the foregoing valuation methods. In such an event, the value may be determined by applying, in a flexible manner, whichever of those methods that enables calculation of customs value.

The customs value arrived at should be fair, reasonable, uniform and neutral and should reflect commercial reality to the extent possible.

Notes: Putting negative ideas first

When the following adverbs and expressions as never, hardly, scarcely, not only, under no circumstances etc. begin a sentence, the normal order of subject and auxiliary verb is reversed in order to emphasize the negative aspect.

Never before, have we commissioned such an extensive survey.

On no account should confidential information be shown to the press.

The same change of structure takes place when the subordinate clause preceding the main clause, has a negative meaning.

Only when the transaction value method cannot be used should the other methods be considered.

Essential words and phrases:

customs valuation - определение таможенной стоимости

customs value - таможенная стоимость товара

assessment of customs duty - исчисление таможенной пошлины

licensing arrangements - порядок выдачи лицензий

transaction value method

- метод определения таможенной стоимости товаров на основании контракта

transaction value of identical goods

- метод определения таможенной стоимости товаров по стоимости сделки с идентичными товарами

transaction value of similar goods

- метод определения таможенной стоимости товаров по стоимости сделки с однородными (похожими) товарами

deductive method - определение таможенной стоимости товаров по методу вычитания

computed method - определение таможенной стоимости товаров по методу сложения

residual valuation provisions

- резервный метод определения таможенной стоимости товаров

Working on the text

Task 5. Find the words in the text which are similar in meaning to the words below.

1. calculation

2. talks

3. practical use

4. exchange of goods

5. an official limit

6. permit

7. commodity

8. to bring a product into a country

Task 6. Match the adjectives 1)-8) to the nouns (the letters a-h) with which they are used in the text.

1. major a) circumstances

2. significant b) part

3. multilateral c) system

4. uniform d) feature

5. primary e) method

6. total f) payment

7. identical g) goods

8. exceptional h) negotiations

Task 7. The prefix “under-” has the meaning “too little” and the prefix “over-” – “too much”. Form the words with these prefixes and translate into Russian.

Model:

valuation undervaluation overvaluation

1. charge

2. estimate

3. to produce

4. to compensate

5. population

Task 8. Answer the questions: Why can undervaluation result in underpayment of Customs duties?

What group of Customs violations does undervaluation refer to?

Task 9. Complete the missing letters in the following words.

1. _ a l _ _ t _ o n

2. _ _ r _ f f

3. t r _ _ e

4. _ m p _ r t _ t _ _ n

5. a _ r _ e m _ _ t

6. u n _ f _ _ m

7. m _ t h _ d

8. r _ s _ _ _ a l

Task 10. Answer the following questions.

1. Why is customs valuation considered a major feature of customs tariff system?

2. What was one of the results of the Geneva negotiations?

3. How many methods of valuation applicable to all goods are accepted?

4. What is the primary method based on?

5. Which are the other five methods?

6. How should these methods be applied?

Task 11. Translate article 65 of the “Customs Code of the Customs Union” into English.

Статья 65. Декларирование таможенной стоимости товаров

1. Декларирование таможенной стоимости товаров осуществляется декларантом в рамках таможенного декларирования товаров в соответствии с нормами, установленными главой 27 настоящего Кодекса и настоящей главой.

2. Декларирование таможенной стоимости ввозимых товаров осуществляется путем заявления сведений о методе определения таможенной стоимости товаров, величине таможенной стоимости товаров, об обстоятельствах и условиях внешнеэкономической сделки, имеющих отношение к определению таможенной стоимости товаров, а также представления подтверждающих их документов.

Task 12. Translate the following text from Russian into English.

Проблема определения таможенной стоимости – ключевая для формирования доходов федерального бюджета и для защиты интересов российской экономики, в том числе ее конкурентоспособности.

Действительно, определение таможенной стоимости – вечный предмет спора между таможенными органами и участниками ВЭД. Таможенники опасаются ее занижения для уменьшения ввозных пошлин и НДС при импорте. Импортеры – против корректировки таможенной стоимости и доначисления платежей. По закону “О таможенном тарифе” таможенная стоимость импорта определяется по шести методам: на основании контракта, то есть по фактически уплаченной цене за него; по стоимости сделки с идентичными товарами; по стоимости сделки с однородными (похожими) товарами; по методу вычитания; методу сложения, а также резервному. Импортеры предпочитают первый, таможня – шестой, он позволяет применять “разумную гибкость”. Это приводит к постоянным жалобам участников ВЭД на коррупцию в ФТС.

“Коммерсант”, 5.09.09

Task 13. Write a short essay (10-12 sentences) with your proposals how to solve the “eternal dispute” mentioned in the above newspaper article.

Task14. Discuss the problem in class and choose the best essay.