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Retroactive Adjustment of Customs Value in the Export Supplies of Natural Gas
 
PIIS231243500022150-3-1
DOI10.18572/2410-4396-2019-3-92-96
Publication type Article
Status Published
Authors
Sergey S. Koshman 
Affiliation: Saint Petersburg State University of Economics
Address: Russian Federation, Saint Petersburg
Journal nameEnergy law forum
EditionIssue 3
Pages92-96
Abstract

Legal regulation of state control in the energy sector is rightly referred to the main elements of legal regulation in the energy sector which forms the energy order, and, therefore, the tasks of the science of energy law include conducting research on the state control system in the energy sector [1]. One of the main activities of the customs authorities is customs control. Based on the results of inspections in 2018, the customs authorities additionally charged customs payments (customs duties, penalties, fines) for a total amount of 11.9 billion rubles, 4,645 administrative cases and 203 criminal cases were initiated [2].

Control of customs value (CV) is one of the most common types of customs control. In the exercise of this type of customs control, the customs authority checks the correctness of the chosen method for determining the CV, the correctness of calculation by the declarant of the CV, the presence of documentary evidence of information on the customs value specified in the customs declaration.

As a result of verification of correctness of declaration of the CV by the declarant, disputes often arise between the customs authority and the customs applicant regarding the correct determination of the customs value. Therefore, following the results of 2018, the customs authorities performed about 168 thousand adjustments to the CV of the goods [3]. As a rule, the result of adjustment of the customs value is additional charge of the amount of the customs duty payable to the budget as well as a penalty.

This article examines the legal grounds and conditions for adjustment of the customs value after release of the goods for export of natural gas, considers the procedure for the declarant and the customs authority in the adjustment of the customs value, makes proposals for improvement of the existing mechanism for the CV adjustment.

 

Keywordsenergy law, energy law order, state regulation in the energy sector, state control in the energy sector, legal regulation for export of gas
Received31.07.2019
Publication date01.09.2019
Number of characters14457
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1

Calculation of Customs Value and Payment of Customs Duty in the Export Supplies of Natural Gas

In the export supply of natural gas, with a view to releasing the goods by the customs authority, when submitting the customs declaration, the declarant shall calculate the customs value of the exported goods and calculate, based on the declared customs value, and pay the customs duty to the budget. The customs duty is a mandatory payment levied by the customs authorities in connection with the goods crossing the customs border of the Eurasian Economic Union (EAEU). The customs duty on exported natural gas is currently ad valorem, that is, it is calculated as a percentage of the declared customs value and amounts to 30% of the customs value of the goods [4].
2 The economic basis of the customs duty is the customs value, the determination of which leads to a significant number of disputes [5]. At the stage of filing the customs declaration, the customs authority checks correctness of calculation of the customs value as well as availability of the necessary funds of the declarant to pay the customs duty. Based on the results of the check, the customs authority adopts a decision on release of the goods. Such decision is made by the customs authority subject to compliance by the declarant with the conditions of the declared customs procedure, the correct calculation of the customs duty, and also payment of the customs duty to the budget. If the customs authority decides to ban the release of the goods, the declarant may not dispose of the goods in accordance with the declared customs procedure until the deficiencies identified by the customs authority are eliminated.
3 In the export supply of natural gas, temporary periodic declarations are used. General rules of this declaration procedure are provided for in Article 102 of the Federal Law On Customs Regulation. Peculiarities of use of this procedure in relation to natural gas are set forth in Article 204 of the Federal Law On Customs Declaration.
4 In case of temporary periodic declaring, the declarant shall submit a temporary customs declaration (TCD) prior to the delivery and calculate and pay the customs duty in the amount of not less than 50% based on tentative information on the expected delivery of the goods declared in TCD on or before the 20th day of the month preceding the month of delivery.
5 Based on the results of the delivery, on or before the 20th day of the month following the month of delivery, the declarant shall submit a full customs declaration (FCD) and provide the final information in it based on the actual delivery of the goods. The declarant shall also pay the remaining amount of the customs duty.
6 Thus, in the export delivery of natural gas, the customs authority shall check correctness of the application and calculation of the customs duty both in the filing of both the TCD and the FCD. The customs value, in the filing of both the TCD and the FCD, shall be calculated by the declarant based on the civil relations with the buyer of the goods existing at the time of customs declaration. In the vast majority of cases, in the declaration of natural gas supplies, the transaction value in relation to declared goods is used as of the time of declaration to determine the customs value of the goods.
7 At the same time, for various reasons, the transaction value may change after delivery, export of the goods from the territory of the EAEU and, accordingly, after release of the goods by the customs authority. In this case, the customs value declared in the declaration is subject to adjustment. Herewith, adjustment of the customs value after release of the goods is a decision of the customs authority to amend the customs declaration. The grounds, and the terms and conditions of such an adjustment should be considered separately.
8

The Declarant’s Right to Adjust the Customs Value after Release of Goods in the Export of Natural Gas
9 The customs value is adjusted by the declarant when the customs value of the exported goods specified in the customs declaration no longer corresponds to the value as of the time when the customs declaration was submitted.
10 The declarant’s right to adjust the customs value after release of the goods is set forth in Article 112 of the CC of the EAEU. This norm provides that the customs value after release of the goods shall be adjusted by decision of the customs authority or with the permission of the customs authority and only in cases stipulated by the code and/or determined by the Commission.
11 It should be concluded from this norm that:
  • the customs law essentially allows for the declarant’s right to adjust the customs value after release of the goods;
  • to exercise this right, the declarant shall contact the customs authority indicating the reasons that served as the basis for adjustment of the customs value, and
  • the customs authority shall make a decision on adjustment of the customs value, which is an administrative action of the public authority on adjustment of the customs value.

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1. Romanova V.V. Energy Law Order: Current State and Tasks / V.V. Romanova. Moscow : Yurist. 2016. 255 p.
2. Results of Activities of Customs Authorities on Customs Control after Release of the Goods for 2018. URL: http://cus-  toms.ru/index.php?option=com_content&view=article&id=27220:2018-&catid=343:2012-08-09-12-59-58&Itemid=1830&Itemid=2268
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6. Disputes regarding refusal of the customs authorities to adjust the customs value also arose within the framework of cases Nos. А40-56169/11-94-467, А40-57262/11 92-476, and А40-58217/11-21-488. URL: http://ras.arbitr.ru/ 
7. This position was consolidated in clause 13 of Decree No. 18 of the Plenum of the Supreme Court of the Russian Federation dated May 12, 2016, On Certain Issues of Application of Customs Laws by Courts // Rossiyskaya Gazeta 2016. May 18
8. Clause 40 of the Review of Judicial Practices of the Supreme Court of the Russian Federation No. 4 (2018), Ruling No. 309-КГ18-5069 of the Supreme Court of the Russian Federation, Ruling No. 293-ПЭК18 of the Supreme Court of the Russian Federation dated December 10, 2018. URL: http://ras.arbitr.ru/ 
9. Decision No. 289 of the Board of the Eurasian Economic Commission dated December 10, 2013, On Amendment of (Additions to) the Information Stated in the Goods Declaration and Invalidation of Certain Decisions of the Commission of the Customs Union and the Board of the Eurasian Economic Commission // Official Website of the Eurasian Economic Commission. URL: http://www.eurasiancommission.org/  (date of access: December 11, 2013)
10. Mokrov G.V. Eurasian Economic Union. Dumping Imports and Anti-Dumping Measures to Protect the Domestic Market : monograph / G.V. Mokrov. Moscow : Prospekt, 2018. 352 p.

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