Question 23
Domain 3: Customs ValuationWhich of the following is considered an assist and should be included in the entered value?
Correct answer: D
Explanation
Under 19 U.S.C. 1401a(h)(1)(A), an assist includes “materials, components, parts, and similar items incorporated in the imported merchandise” that are supplied free of charge by the buyer. The printed circuit assembly components for switch integration were provided free by the U.S. importer to the foreign producer, so their value must be added to transaction value.
Why each option is right or wrong
A. The cost of engineering plans produced in Omaha, Nebraska for switch assemblies that are supplied free of charge by a U.S. importer to a foreign producer of switches in Taipei, Taiwan.
Engineering plans are not materials, components, parts, or similar items incorporated into the imported merchandise.
B. The cost of printed circuit assemblies that will be integrated into timing switches that are purchased by a foreign producer of switch assemblies produced in Taipei, Taiwan.
Purchased components are not free or reduced-cost items supplied by the buyer as an assist.
C. The cost of a factory air conditioning system that was supplied free of charge by a U.S. importer to a foreign producer of switches in Taipei, Taiwan.
Factory equipment is not incorporated into the imported merchandise; assists cover items used in production.
D. The cost of printed circuit assembly components for switch integration that are supplied free of charge by a U.S. importer to a foreign producer of switches in Taipei, Taiwan.
19 U.S.C. 1401a(h)(1)(A) requires adding the value of assists to transaction value when the buyer supplies, directly or indirectly, materials or components used in producing the imported merchandise free of charge or at reduced cost. Here, the U.S. importer furnished printed circuit assembly components to the foreign switch producer in Taipei without charge, and those components were incorporated into the imported switches, so their apportioned value must be included in the entered value.