Member lesson
See the reasoning behind the question
Sign in with your existing membership to watch.
Sign inApril 2026 · Q71 · Valuation & Duty
A related-party sale can still have transaction value
Explain that when a foreign seller sells merchandise for exportation to the United States to a related buyer, transaction value (the price actually paid or payable, plus the 152.103(b) additions) remains available: under 19 CFR 152.103(l)(1) the relationship alone is not a reason to disregard it, and under 152.103(j)(1)(iv) and (j)(2)(i) a related-party transaction value is acceptable if an examination of the circumstances of sale indicates the relationship did not influence the price actually paid or payable. Recognize the separate alternative: the importer or buyer may show that the value closely approximates a test value (transaction value of identical or similar merchandise in sales to unrelated U.S. buyers, or deductive or computed value of identical or similar merchandise) for merchandise exported at or about the same time. The absence of unrelated sales by the seller does not by itself exclude transaction value (152.103(l)(1) example). Being a sale is not automatic acceptance: every 152.103(j)(1) condition still applies — no restrictions on disposition or use other than the permitted kinds, no condition or consideration whose value cannot be determined, no proceeds accruing to the seller unless an appropriate (b)(1)(v) adjustment can be made, and an acceptable related-party value.
What you will learn
Explain that when a foreign seller sells merchandise for exportation to the United States to a related buyer, transaction value (the price actually paid or payable, plus the 152.103(b) additions) remains available: under 19 CFR 152.103(l)(1) the relationship alone is not a reason to disregard it, and under 152.103(j)(1)(iv) and (j)(2)(i) a related-party transaction value is acceptable if an examination of the circumstances of sale indicates the relationship did not influence the price actually paid or payable. Recognize the separate alternative: the importer or buyer may show that the value closely approximates a test value (transaction value of identical or similar merchandise in sales to unrelated U.S. buyers, or deductive or computed value of identical or similar merchandise) for merchandise exported at or about the same time. The absence of unrelated sales by the seller does not by itself exclude transaction value (152.103(l)(1) example). Being a sale is not automatic acceptance: every 152.103(j)(1) condition still applies — no restrictions on disposition or use other than the permitted kinds, no condition or consideration whose value cannot be determined, no proceeds accruing to the seller unless an appropriate (b)(1)(v) adjustment can be made, and an acceptable related-party value.
19 CFR 152.103(b)(1) Transaction value definition; 19 CFR 152.103(j)(1)(i)-(iv) Limitations on use of transaction value; 19 CFR 152.103(j)(2)(i)-(ii) Related person transactions (official key citation: (j)(2)(i)); 19 CFR 152.103(l)(1) Validation of transaction, interpretative notes 1-3 and Example; 19 CFR 152.103(l)(2)(i)-(iii) Test values · Exam cover: HTSUS 2025 Basic Edition, no supplements; 19 CFR cover 'Revised as of January 1, 2024'. Actual GovInfo annual edition files used here are revised as of April 1, 2024 (2024-04-01); disclosed, not relabeled as January 1. Historical exam lesson, not a current-law statement.
Explained using the historical edition for this exam.