Customs Valuation Audit Mechanics for Cross Border Agency Import Transactions
Customs valuation in agency imports depends on proving buying commission exemptions under Decree 213 while adjusting for assists and royalties.
Voluntary Disclosure Announcement 61
Meaning
Regulatory policy issued by the General Administration of Customs provides a mechanism for companies to self-report customs non-compliance in exchange for reduced penalties. Under voluntary disclosure announcement 61, importers can avoid the most severe administrative consequences if they proactively report errors in their declarations before the authorities initiate a formal investigation. This policy encourages self-correction and improves overall trade compliance.
Disclosure Benefit
Enterprises that successfully utilize this program can receive a complete waiver of administrative fines and avoid a downgrade of their credit ratings. The tax bureau may also waive the interest charges on the unpaid duty if the disclosure is made within a specific timeframe. This treatment represents a significant saving compared to the penalties imposed when customs inspectors discover the errors themselves.
Eligibility Condition
Submitting a disclosure does not guarantee lenient treatment unless the company meets several requirements. The disclosure must be complete, accurate, and made in writing before customs has begun an audit or received tips from third parties. Additionally, the company must pay all outstanding duties and implement corrective measures to prevent future errors.
Strategic Assessment
Deciding to use the program requires a careful evaluation of the company’s import records and potential liabilities. Legal counsel should review the found discrepancies to confirm they qualify for the program and that the company can pay the back taxes immediately. This evaluation is critical because an incomplete or inaccurate disclosure can trigger the very audit the company was trying to avoid, leading to increased scrutiny and higher fines, which makes a thorough pre-filing review by independent customs specialists an essential step in the process.