Method of Calculation of Duty
1. The value of any imported goods shall be taken to be the normal price, that is to say the price that they would fetch, at the time when they entered for home use (or, if they are not entered, at the time of importation), or sale in the open market between a buyer and a seller independent of each other.
2. The normal price of any imported goods shall be determined on the following assumptions:
a. That the goods are treated as having been delivered to the buyer at the port or place of importation;
b. That the seller will bear freight, insurance commission and all other costs, charges and expenses incidental to the sale and the delivery of the goods at the port or place of importation; and
c. That the buyer will bear any duty or tax payable in the Cayman Islands.
3. A sale in the open market between buyer and seller independent of each other assumes:
a. That the price is the whole consideration;
b. That the price made is not influenced by any commercial, financial or other relationship whether by contract or otherwise between the seller or any person associated in business with him (other than relationship created by the sale of goods in question); and
c. That no part of the proceeds of the subsequent re-sale or disposal of the goods will accrue either directly or indirectly to the seller or any person associated in the business with him.
4. Where the goods to be valued are:
a. Manufactured in accordance with any patented invention or are goods to which any registered design has been applied; or
b. Imported with a foreign trade mark, or are imported for sale (whether or not after further manufacture) under a foreign trade mark, the normal price shall be determined on the assumption that the price covers the right to use patent, design or trade mark in respect of the goods.
5. For the purposes of paragraph 3, persons shall be considered to be associated in business if, whether directly or indirectly, there exists a mutual interest in the business or property of the other.
6. For the purpose of determining the price of goods under sub–section (2) which are uninsured, there shall be substituted for the cost of insurance, an insurance cost equal to one percent of the cost and freight of such goods. Where the cost of freight is not able to be calculated or is unsatisfactory (deemed to be questionable?), the Director shall determine the cost of freight on the basis of known reliable costs on similar or identical goods on an equivalent or identical voyage.
7. Discounts and similar reductions in invoiced values will be deductible from the value for duty only if it can be shown to the satisfaction of the Customs and Border Control Service that such deductions are available to any buyer purchasing similar goods from the same supplier, and do not result from special relationship between buyer and seller, and do not in any case exceed twenty per centum of the invoice value.
8. The Director may, for the purposes of this section, require an importer or other person concerned with the importation of goods to furnish, in such form as may be required, such information as is necessary for a proper valuation thereof, and to produce any books of accounts or documents of whatever nature relating to the purchase, importation or sale of the goods by that person.