CBP Finds Foreign Inland Freight Charges Not Deductible From Price Paid

The foreign inland freight costs in the country of export can't be deducted from the price paid or payable unless there is proof of sale for export and a through shipment from the factory, CBP said in an Oct. 27 ruling. The ruling request came from Cracker Barrel Old Country Store and sought CBP input on whether certain charges for services provided by Damco Customs Services Inc. should be included in the transaction value of the imported merchandise. The agency found that several other fees are allowed to be deducted from the transaction value.

The documentation provided included a waybill that shows the shipment of the merchandise from China's Port of Ningbo to the Port of Savannah. CBP regulations allow for foreign inland freight to be considered incident to shipment, and therefore deductible, “if they are identified separately and they occur after the merchandise has been sold for export to the United States and placed with a carrier for through shipment to the United States,” CBP said.

The waybill “does not show through shipment from the factory to the Port of Savannah,” CBP said. “Since there is no evidence of through shipment from the factory to the U.S., no deduction may be made for foreign inland freight costs.” Fees that should be deducted from the value include the carrier agent booking fee, carrier bill of lading, documentation fee, port security charge, supply chain security fee, and terminal handling charges, CBP said.