HQ 544829: Application for Further Review of Protest No. 3126-91- 100001; Price Actually Paid or Payable; Proof Thereof

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 544829

                        February 20, 1992


VAL CO:R:C:V  544829 DPS

CATEGORY:  Valuation

District Director
U.S. Customs Service
Portland, Oregon

RE:  Application for Further Review of Protest No. 3126-91-
     100001; Price Actually Paid or Payable; Proof Thereof

Dear Sir:

     The subject protest and application for further review
concerns the appraisement of various types of fuel (petroleum
products) manufactured by Shell Canada Products, Ltd.,
imported from Canada by Petro-Diamond, Inc., the protestant,
and delivered to Dutch Harbor, Alaska.  The sole issue raised
by the subject protest focuses on which price, amongst
various prices reflected in documents submitted by the
importer, should be considered the price actually paid or
payable for the imported merchandise when sold for
exportation to the United States.

FACTS:

     Petro Diamond protests Customs appraisement of fuel
products imported from Canada.  The protested appraisement is
based on prices reflected in a manufacturer's invoice from
Shell Canada Products Limited (Shell Canada) referring to
Petro Diamond's supplier, Mieco Inc. (Mieco), as the buyer. 

     The protestant claims that the product valuation should
be based on its delivered purchase price pursuant to its
contract with its supplier (Mieco), not the price paid by its
supplier.  The protestant claims that normal industry
practice is to use a published price index to obtain average
prices.  Protestant cites Platt's Oilgram as a basis for the
average prices of "waterborn product" delivered at the time
the subject merchandise was, and suggests that Customs
utilize these average prices for purposes of appraisement.  

     In response to the import specialist's requests for
information, Petro Diamond and its Customs broker supplied
various documents including copies of telexed contracts 


between Petro Diamond and Mieco, pro-forma invoices prepared
by Petro Diamond for Customs purposes, export declarations
from Canada and a copy of an invoice from Shell Canada to
Mieco reflecting the sale of the specific fuel types which
were imported by the protestant.

     You take the position that appraisement should be based
on the foreign seller's invoiced prices, the applicable
invoice being number 214996 from Shell Canada.  You note that
in response to your request for value information, the
importer submitted various copies of telexes and invoice
number 214996, all listing various prices.  No supporting
documentation providing proof of actual payment for the fuel,
nor an explanation of the varying prices was submitted by the
importer.  Accordingly, you indicate that appraisement should
be at Shell Canada's invoiced prices.

ISSUE:

     Whether the protestant has provided sufficient
information to support its claim for reappraisement at prices
reflected in an industry average price index.


LAW & ANALYSIS:

     For the purpose of this response, we are assuming that
transaction value is the appropriate basis of appraisement. 
Transaction value is defined in section 402(b)(1) of the
Tariff Act of 1930, as amended by the Trade Agreements Act of
1979 (19 U.S.C. 1401a(b);TAA) as the "Price actually paid or
payable for the merchandise" plus amounts for the five
enumerated statutory additions in  402(b)(1).  
          
     19 U.S.C. section 1500 (section 500 of the Tariff Act of
1930 as amended by the TAA) provides the general authority
for Customs to appraise merchandise.  With regard to section
500, Customs Statement of Administrative Action provides:

     Section 500 allows Customs to consider the best
     evidence available in appraising merchandise.  It
     allows Customs to consider the contract between the
     buyer and the seller, if available, when the
     information contained in the invoice is either
     deficient or is known to contain inaccurate figures
     or calculations.  Likewise, a contract which has
     been outdated by subsequent renegotiations prior to
     exportation would not be considered when an invoice
     which reflects these renegotiations is presented. 




Section 500 authorizes the appraising officer to weigh the
nature of the evidence before him in appraising the imported
merchandise under the constraints of section 402.

     Here, the import specialist requested and received
further information from the protestant concerning the
pricing of the imported fuel products.  However, the
information and documentation submitted by the protestant
fails to establish the price actually paid or payable for the
imported petroleum products.  No proof of payment or thorough
explanation of pricing was provided by the protestant. 
Therefore, the appraising officer had no choice but to rely
on the foreign seller's invoiced prices.

HOLDING:

     Because no evidence has been submitted which supports
the argument that the merchandise was incorrectly appraised,
the protest must be denied.  Accordingly, you are directed to
deny the subject protest.  A copy of this decision should be
attached to the Customs Form 19 and mailed to the protestant
as part of the notice of action on the subject protest.



                              Sincerely,



                              John Durant, Director
                              Commercial Rulings Division