Customs Valuation - Royalty paid to Third Party Licensor
THE Technical Committee on Customs Valuation of WCO has published Advisory Opinion 4.15 which provides guidance on a case where royalties have been paid to a third party licensor (in other words, the licensor is not the seller of the goods) and determines whether or not it is appropriate to include the royalty fee in the Customs value of the imported goods.
It is almost accepted that the royalties paid by the importer to someone other than the seller of the product must be added to the price paid for the product to determine transaction value when the royalty is related to the imported product and is paid as a condition of sale to the importer.
The Advisory opinion confirms that the royalty amount must be added to the price of the imported goods.