GlossaryEN1 min readUpdated: Jun 26, 2026
GATT Article VII
Unlike earlier customs practices that allowed authorities to assess goods values at their own discretion, GATT Article VII establishes a binding, internationally agreed framework for customs valuation.
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Source: https://www.wto.org/english/tratop_e/cusval_e/cusval_e.htm
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Incoterms 2020 Simulator: Who bears costs & risk?
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Definition & Explanation
Unlike earlier customs practices that allowed authorities to assess goods values at their own discretion, GATT Article VII establishes a binding, internationally agreed framework for customs valuation. The primary standard is transaction value – the price actually paid or payable for goods sold for export – adjusted to include freight to the point of importation, insurance, packaging, and any commissions or royalties applicable. Where transaction value cannot be determined or accepted, five alternative methods apply in strict descending order: transaction value of identical goods, transaction value of similar goods, deductive value derived from the resale price, computed value based on production costs, and a fallback method. These principles are implemented through the WTO Customs Valuation Agreement of 1994, binding on all WTO members. Customs declarants and trade compliance auditors invoke this hierarchy routinely whenever declared values are called into question by border authorities.
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