CLA-2 CO:R:C:V 544236 EK
Area Director of Customs
Kennedy Airport Area
Jamaica, New York
RE: Decision on Application for Further Review of
Protest No. 1001-5-011625
Dear Sir:
This is in reference to your decision on the liquidation of
Entry No. 4701-83-891030 dated May 31, 1985. The merchandise was
appraised pursuant to deductive value, section 402(d) of the
Tariff Act of 1930, as amended by the Trade Agreements Act of
1979 (TAA; 19 U.S.C. 1401a(d)).
All interested parties are in agreement that deductive
value is the correct basis of appraisement. At issue is the
proper allowance for international freight pursuant to section
402(d)(3)(A)(ii) of the TAA. That section provides for a
deduction for "the actual costs and associated costs of
transportation and insurance incurred with respect to
international shipments of the merchandise concerned from the
country of exportation to the United States."
The importer indicates that the proper allowance for
international freight is that which is noted on the airway bill,
the actual prepaid freight charge. Customs rejected the amount
noted on the airway bill and deducted a freight charge based upon
the International Air Traffic Association freight rate. This
freight rate was used rather than the amount on the airway bill
because the importer failed to provide proof of payment. The
importer and the shipper are related.
ISSUE:
Whether the proper amount to be deducted in appraising
imported merchandise pursuant to deductive value is the actual
amount listed on the airway bill.
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LAW AND ANALYSIS:
As indicated above, in determining the proper amount to be
deducted for appraisement pursuant to deductive value, section
402(d)(3)(A)(ii) clearly states that the actual costs of
transportation are to be deducted. Although actual proof of
payment has not been submitted, the airway bill serves as
sufficient evidence of the actual costs of transportation. The
figure corresponding to the freight chart is not the actual cost
but rather, a mere estimate.
The best evidence available for the transportation cost is
the airway bill, i.e., a bill for the services performed.
HOLDING:
In view of the foregoing, the proper deduction to be made
for transportation pursuant to section 402(d)(3(A)(ii) of the TAA
is the amount indicated on the airway bill. You are directed to
grant the protest in full. A copy of this decision should be
attached to the Form 19, Notice of Action, to be sent to the
protestant.
Sincerely,
John Durant, Director,
Commercial Rulings Division