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Guide to Customs Administration

ACVA

컨텐츠서비스메뉴

Significance of ACVA

Significance

A system designed to grant prior approval of the method of determining the dutiable value of goods traded between specially related parties, such as an overseas parent company and its branch in Korea, through mutual agreement between a duty payer and the customs authorities after such duty payer’s application for approval of the method (ACVA: Advance Customs Valuation Arrangement for transactions between related parties)

ACVA

ACVA benefits

Heightening the predictability of tax payments
  • Dutiable values are determined according to the contents of ACVA approval for three years after ACVA approval.
Deferment of customs duty investigation
  • Customs duty investigation is deferred with respect to the dutiable value of the goods on which ACVA has been applied for from the time of application until the time of approval.
Declaration of a provisional value and exemption from additional duty
  • As any ACVA applicant can use the provisional value declaration system from the date of ACVA application, the applicant will be exempt from additional duty if the dutiable value of goods is changed to the value approved by ACVA.

ACVA application and examination

Major examination and judgment fields (selectable)
  • Whether the special relationship has influenced the transaction price or not;
  • Whether the dutiable value determination method (one of the first to sixth methods) applied for is valid or not;
  • Whether there are any factors of addition or deduction or not;
  • Whether the dutiable value is appropriate or not;
  • Whether the internal tax authorities approve the advance pricing arrangement (APA) or not, or recognize the dutiable value determination method applied for or not.
Eligibility for application

Any company that continuously imports goods from an overseas exporting company with which it is specially related.

ACVA processing procedure

Process of ACVA

Divisions in charge of ACVA

ACVA operation, examination, and prior examination of other dutiable value determination methods

Customs Valuation Division, the Customs Valuation and Classification Institute
Tel.) 82-42-714-7504

The ACVA policy and the valuation policy for transactions between specially related parties

Corporation Examination Division, the Korea Customs Service
Tel.) 82-42-481-7987

Difference between ACVA and general prior dutiable value examination

Differentiation by classification between the case of carrying out prior examination of methods of determining the dutiable value of goods not traded between specially related parties (general imported goods) (general prior examination) and the case of carrying out examination of methods of determining the dutiable value of goods traded between specially related parties (imported goods between specially related parties) (ACVA)

Comparison between general prior examination and ACVA
Comparison between general prior examination and ACVA
Classification General Prior Examination ACVA
Goods subject to examination General imported goods Imported goods between specially related parties
Examination period 30 days One year
Enforcement date December 31, 1990 January 1, 2008
Eligibility for application All the duty payers who trade with overseas exporters Any duty payer who continuously imports goods from an overseas exporter specially related with the importer located in Korea
Examination procedure Unilateral determination - Consultation with the duty payer
- Duty payer’s agreement
Examination agency Customs Valuation and Classification Institute Customs Valuation and Classification Institute
※ Formation of a separate ACVA Pre-examination Team
Main examination matters - Checking to ascertain the price actually paid and whether there are any factors of addition or deduction
- Checking to ascertain the requirements for the formation of the transaction price (checking to ascertain the conditions or circumstances, whether there are any disposition or restriction of use, any subsequent proceeds, any influence of the special relationship)
※ Prior examination of the matters prescribed in Article 1 and Article 8 of the WTO Valuation Agreement
- Whether the special relationship has influenced the transaction price or not
- Whether the method of determining the dutiable value applied for (any one of the first to sixth methods) is valid or not
- Whether there are any factors of addition or deduction or nott
- Whether the customs value is appropriate or not
※ The dutiable value determination method and the dutiable value regarding APA approval or the application details
Post management There is no obligation to submit a report - Submission of an annual report

Newly established easy-ACVA (implemented from October 14, 2015)

  • The existing ACVA application and examination procedures have been greatly simplified in order for small and medium-sized enterprises to be examined in advance more easily and quickly.
  • Providing legal stability for small and medium-sized enterprises unable to use the ACVA system because of ACVA application expenses and difficulties by providing them with swift and convenient ACVA procedures.

Divisions in charge of ACVA

  • ACVA operation, examination, and prior examination of other dutiable value determination methods
    Customs Valuation Division, the Customs Valuation and Classification Institute
    Tel.) 82-42-714-750
  • The ACVA policy and the valuation policy for transactions between specially related parties.
    Corporation Examination Division, the Korea Customs Service
    Tel.) 82-42-481-7987
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