Computed value method
Fifth customs valuation method based on the cost of production of goods in the exporting country, including usual profits and general expenses.
Definition and principle
The computed value method (or reconstructed value) is the fifth customs valuation method. It determines customs value by reconstructing the cost of production of goods in the exporting country. This "bottom-up" approach starts from the manufacturing cost and adds usual profits and general expenses.
Legal framework
The method is provided for by article 74, paragraph 2, point (d) of the UCC and corresponds to article 6 of the WTO Customs Valuation Agreement. Delegated Regulation 2015/2446 (article 144) specifies its elements. The importer may request that this method be applied before the deductive method (reversal of order).
Constituent elements
The computed value comprises:
- Cost of materials and fabrication used in producing the goods
- Amount of profit and general expenses usually reflected in sales from the exporting country of goods of the same class or kind
- Cost of assists not already included
- Transport and insurance costs to the point of introduction into the EU customs territory
Practical limitations
- This method is rarely used in practice as it requires access to the foreign producer's accounting records, which EU customs authorities cannot compel
- It is primarily applicable in intra-group transactions where the foreign producer agrees to share cost data
- Customs authorities cannot compel a foreign producer to provide this information — cooperation is voluntary
- In practice, it is often superseded by the fall-back method