CBP Withdraws Proposed Changes to the First Sale Rule

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On September 29, 2010, U.S. Customs and Border Protection (CBP) issued a notice in the Federal Register withdrawing proposed changes to the so-called "First Sale" rule under which in a transaction involving a series of sales, the price actually paid or payable for customs valuation purposes would be the price paid or payable under the first sale or the sale between the manufacturer and the middleman, rather than the price paid by the U.S. importer or buyer in the U.S. 

CBP had proposed for the first time in January 2008 a new interpretation of the expression "sold for exportation to the United States" for purposes of determining transaction value. CBP suggested that, in a transaction involving a series of sales, the price actually paid or payable for the imported goods when sold for export to the U.S. would be the price paid in the last sale occurring prior to the entry of goods into the U.S., rather than the first sale. The effect of the proposed interpretation would have been that the transaction value would be determined on the basis of the price paid by the buyer in the United States.