ANNOUNCEMENT 25 Dec 2013In December 2013, the government of China announced a change in import formalities.
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On 25 December 2013, the Chinese General Administration of Customs published Decree No.213 changing the customs valuation method.
According to the law firm Squire Patton Boggs, "Decree No. 213 adds in its Article 18 that 'if the circumstances of the sale are examined to be consistent with general business practices, Customs may determine that the special relationship does not influence the transaction value of the imported goods'.That language indicates that GAC has adopted the 'circumstances of sale' test, a widely recognized customs valuation principle under which the "transaction value" among related parties may be accepted as the dutiable value if relevant documentation is in place affirming that the pricing is consistent with general commercial practices.
"The two new decrees 'one of them being Decree No.213' are likely to impact companies involved in the distribution of imported and exported goods for related parties, as well as to those entities with domestic sales of bonded materials".
The decree came into force on 1 February 2014.