RESTRICTED
WORLD TRADE WT/ACC/SAU/18
21May1997
ORGANIZATION(97-2111)
Original: English
ACCESSION OFTHE KINGDOM OFSAUDI ARABIA
Communication from Saudi Arabia
ThePermanentMissionoftheKingdomofSaudiArabiahastransmittedthefollowinginformation
onSaudi Arabia 'scustoms valuation regime withtherequest thatitbetransmitted tomembers ofthe
Working Party.
_______________
SAUDI ARABIA 'SCUSTOMS VALUATION REGIME
Introduction
Thefollowing description supplements andconsolidates material onSaudi Arabia 'svaluation
regime already forwarded totheWorking Party in:
- paragraphs 51to53oftheoriginal Memorandum ontheForeign Trade Regime;
- replies 93,94and96-101inL/7645/Add.1;
- paragraphs 79-81andAnnex 4ofthe(revised) Memorandum ontheForeign Trade Regime
(WT/ACC/SAU/4);
- replies 44-50ofWT/ACC/SAU/6; and
- replies 48and49ofWT/ACC/SAU/8.
Specific Duties
Forcertain items, theCustoms Tariff, indicates specific duties. Formostoftheseitems specific
duties areshown together withadvalorem rates; thespecific dutyistheminimum amount thatapplies
irrespective ofthecalculation ofdutypayable using theadvalorem method ofcalculation. Inavery
fewinstances (e.g.gypsum) there isnoadvalorem rateshown andthespecific amount isapplied to
allimports.
Specific duties arecalculated inlocal currency units perunitofvolume orbyunitofgross
weight ornetweight. Asstated inthetariffgross weight istheweight ofthegoods including external
andinternal packaging; netweight istheweight ofthegoods without anypackaging or,interalia,
items usedinthepackages forfolding separating orarranging thegoods.
C.i.f. Basis ofAdValorem Duties
Customs duties ongoods entering Saudi Arabia aregenerally assessed asanadvalorem
percentage ofc.i.f. value.WT/ACC/SAU/18
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C.i.f. values arecalculated asthesumofthefollowing:
(1) actual f.o.b. price paidorpayable ongoods;
(2) freight charges;
(3) insurance, anotional amount equal to1percent(ofvalue ofgoods plusfreight).
Value ofGoods asStated intheInvoice
Normally (90percentofallclearances) thef.o.b. value ofgoods isdetermined bytheactual
pricepaidorpayable forthegoods ready forshipping attheportofexportation asstated intheinvoice
(transaction value).
Asthevalue isstated inforeign currency, conversions toSaudi currency aremade atthetime
ofregistration oftheCustoms declaration based ontheexchange rateissued monthly bytheSaudi
Arabian Monetary Authority (SAMA).
Discounts under tradepractice areaccepted bycustoms totheextent thatdiscounts aregranted
toanybuyer without discrimination inacompetitive freemarket.
Documentation
ImportersareobligedtosubmittoCustomsalldocumentationgivingdescriptionsoftheimported
goods andactual f.o.b. prices paidorpayable inthecurrency ofthecountry ofexportation aswell
asfreight andinsurance document. Documentation required is:
(1) original invoices withArabic translation;
(2) certified packing list;and
(3) certified certificate oforigin.
IfCustoms hasreason todoubt thatthevalue stated intheinvoice submitted bytheimporter
doesnotreflect actual value, theprovisions ofArticles 21and51oftheCustoms Regulation empowers
Customs torequest thefollowing documents:
(1) copyoftheagreement between theexporter andtheimporter;
(2) acceptance bythefactory oftheimporter 'sorder withprices quoted;
(3) price listsoftheexporter including catalogues;
(4) copies ofletters ofcredit orreceipts;
(5) certificate ofcredit opening;
(6) catalogues ofthegoods; and
(7) insurance documents.
Methodology Used Where Invoice Values AreNotAccepted
Intheevent thatCustoms, afterreviewing supporting documentation, concludes thatitcannot
useinvoice value asthebasis ofitsassessment, itwillassess thevalue ofthebasis ofthenearest
equivalent value. Customs may, under Saudi Law, employ anumber ofalternative methods for
estimating theequivalent value:
- c.i.f.prices ofidentical goods landed inSaudi ports from thecountry ofexport; or
- c.i.f.prices forsimilar goods landed inSaudi portsfromcountry ofexport, countries adjacent
tothecountry ofexport, orother countries (prices ofsimilar goods willbeadjusted toreflectWT/ACC/SAU/18
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difference inquality) withdeductions made fortheimporter 'sprofit, customs dutyandcharges
relating tointernal transportation andstorage.
Customs hasthediscretion under itsRegulations tousewhatever methodology itconsiders
appropriate todetermine the"nearest equivalent" value. There isno"hierarchy" intheselection of
method.
There isnoprovision inSaudi lawfortheuseofcomputed value based oncostsofproduction.
Special Provisions Relating toAutomobiles
Indetermining actual f.o.b. value fornewvehicles, Customs refers toprice listsissued by
manufacturers. Asregards second-hand (used) cars,anamount equivalent to12percentisdeducted
fromthef.o.b. value ofnewvehicles afterthefirstmodel yearwithfurther deductions of18percent
inthesecond yearand12percentinthethird. totaldeductions donotexceed 45percent.
Minimum Prices
Minimum values areinplace foronetypeofceramic tilesandyeast products forwhich there
hasbeenfrequent under-pricing ininvoices.
Disputes andTheir Resolution
Importers havetherighttoseekandreceive from Customs anexplanation ofhowvalue has
beenassessed.
Ifanimporter wishes todispute anassessed value hemayrefer thematter toastanding
Committee ofCustoms comprising atariff expert, avaluation expert, andalegaladvisor. Importers
mayappeal decisions oftheStanding Committee totheBoard ofGrievances.
Pending resolution ofadispute, animporter mayenterthegoods inquestion against adeposit
equal totheduties assessed byCustoms.
Proposal
TheKingdom ofSaudi Arabia willimplement theValuation Agreement butthisrequires training
ofthemanpower attheports onthesteps forassessment ofvalue, thetranslation intoArabic ofthe
WTO documents, preparation ofnational trainers anddeveloping prospective programs andplans,
updating therelevant automation software, developing legislation authorizing Customs toaccess the
importers 'records forverification ofthedeclared value andestablishing adatabase onthevalues of
theimported goods. Accordingly Saudi Arabia isseeking:
(1) inaccordance withArticle 20.1, afiveyeardelay, from thedateofaccession, forfull
implementation ofitsobligations;
(2) inaccordance withArticle 20.2, toretain therighttonotify afurther threeyears delay before
introducing the"computed-value" methodology forestablishing actual value; and
(3) the"reservations" provided forinparagraphs 2,3and4ofAnnex III.