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Declared import price

Company W is a Japanese trading company set up in Guangdong Province, mainly engaged in ordinary trade import and domestic sales of resins, metals and other goods. The main overseas supplier is a related company. In May, 2014, the in-charge customs authority issued the "Notice of Inspection" to Company W, to implement the inspection on the import and export business from May 2011 to April 2014.

During the inspection, the in-charge customs authority indicated that the declared price of a type of metal imported from overseas related Company M was undervalued, and the basis was that the profitability of Company M was much higher than that of Company W, and thus inferred that Company M tended to import such metal from Company M at an evidently low price. In this regard, the in-charge customs authority required Company W to voluntarily apply to pay the overdue tax, otherwise, the in-charge customs authority would implement formal price consultation procedure.

Our services:
  • Through the interview with responsible people of Company W and the review of relevant documents, to master the composition of declared value of imported metal.
  • From the following aspects, to analyze and demonstrate the reasonability of the declared price of imported metal of Company W.
  • The functions and risks are different between Company W and Company M so that the profitability of the two companies can not be directly compared.
  • From the perspective of other financial indicators, to analyze the reasonability of the profitability of Company M;
  • From the perspective of the import tariff, to analyze that the motivation of Company W to reduce the declared price does not exist;
  • By using the deductive method, to prove that the declared import price of Company W is not affected by special relations.
  • To assist Company W with the preparation of explanation materials and the consultation with customs.

With repeated discussion, negotiation and supplementary explanation materials, the in-charge customs authority accepted our explanation, and determined that the declared import price of imported metal of Company W is reasonable with no need of price adjustment.