Customs Valuation Additions in Bangladesh: Moulds, Royalties, Commissions and Assists

Most importers think of customs value as the number on the supplier’s invoice plus freight and insurance. That is the starting point, but it is not always the finishing point. International customs valuation rules require certain payments that never appear on the invoice to be added to the value, and Bangladesh Customs applies those rules. When they are missed, the importer has under-declared, even if every figure on the invoice was genuine. This guide explains which additions apply, why they exist, and how they catch Bangladeshi importers who buy from China.

The legal basis in Bangladesh

Bangladesh is a member of the World Trade Organization and follows the WTO Agreement on Customs Valuation, which is built on the transaction value method: the price actually paid or payable for the goods when sold for export, adjusted by a fixed list of additions. Domestically, valuation is governed by section 25 of the Customs Act, 1969 and the Customs Valuation (Determination of Value of Imported Goods) Rules, 2000. Our article on the six valuation methods explains the full hierarchy; this post focuses on the adjustments to the first and most common method.

The principle behind the additions is simple. Transaction value is meant to capture everything the buyer pays for the goods, directly or indirectly. If part of the real cost is paid separately, or provided in kind, the invoice price understates the value, and the additions put it back.

The additions, one by one

• Commissions and brokerage, except buying commissions. A selling agent’s commission paid by the buyer is added. A genuine buying commission, paid to your own agent for representing you in purchasing, is not. The distinction depends on whom the agent actually works for, not on what the fee is called.
• Cost of containers and packing. If you pay separately for special packing, crates or reusable containers treated as part of the goods, the cost belongs in the value.
• Assists. Goods and services you supply to the producer free or at reduced cost for use in making the imported goods: materials and components, tools, dies and moulds, materials consumed in production, and engineering, design, artwork or plans undertaken outside Bangladesh.
• Royalties and licence fees related to the goods that you must pay as a condition of the sale, such as a trademark licence fee paid to the brand owner for goods made under that brand.
• Proceeds of resale that flow back to the seller, for example an arrangement where the supplier receives a share of your resale revenue.
• Transport, loading and insurance costs up to the port or place of importation. Bangladesh assesses duty on a CIF basis, so when goods are bought FOB or EXW, the international freight and insurance are added.

Moulds and tooling: the most common missed addition

The addition that most often catches importers buying custom products from China is the mould. A buyer commissions a plastic product, pays the factory a one-off mould fee, and then pays a per-unit price for production. The mould invoice is settled by separate TT months before the first shipment, and the commercial invoice for the goods shows only the unit price.

Under the valuation rules, that mould is an assist. Its cost should be apportioned across the goods produced with it and added to the customs value, either all to the first shipment or spread across shipments on a reasonable, documented basis. An importer who ignores it has understated value on every shipment made with that mould, and a post-clearance audit that finds the mould payment in the bank records can reopen past assessments. Our guide on mould and tooling ownership covers the commercial side of the same arrangement.

What is not added, and what can be excluded

The rules also protect importers from overvaluation. Costs that arise after importation, such as construction, installation, assembly or technical assistance in Bangladesh, can be excluded if they are separately identified in the contract or invoice. Inland transport inside Bangladesh, and duties and taxes payable here, are not part of customs value. Buying commissions, as noted above, are excluded, as are interest charges under a genuine financing arrangement when separately shown.

The key word throughout is separately. If an invoice bundles installation, training or a service contract into one lump-sum price, customs has no basis to deduct anything, and the whole amount may be assessed. When you negotiate a machinery purchase that includes installation by the supplier’s engineers, ask for those elements to be shown as distinct lines.

A worked walkthrough without the numbers

Consider an importer bringing in branded garden tools from a Chinese OEM factory. The importer supplied the factory with the product designs, created by a design firm in Europe, and paid for a set of forging dies. The goods are bought FOB Ningbo, and the importer pays a brand licence fee to the trademark owner for each unit sold, which the licence agreement makes a condition of buying the goods.

• Start with the FOB price on the commercial invoice.
• Add ocean freight and insurance to Chattogram to reach the CIF level.
• Add the apportioned cost of the forging dies (an assist).
• Add the design work, because it was undertaken outside Bangladesh and supplied to the producer (an assist).
• Add the licence fee, because it relates to the goods and is a condition of sale.
• Do not add the fee paid to the importer’s own buying agent in China, provided the agency agreement shows the agent works for the buyer.

Every one of these costs sits in the importer’s own accounts. That is why customs post-clearance audit teams look at bank payments to overseas parties and compare them against declared values. Our article on post-clearance audit explains that process.

Related parties and price influence

Transaction value can only be used without question when the relationship between buyer and seller has not influenced the price. When the Bangladeshi importer and the Chinese seller are related — for example, a group company or a factory part-owned by the importer’s family — customs may examine the circumstances of the sale and ask the importer to show that the price is consistent with what unrelated buyers pay. Keeping evidence such as price lists offered to other buyers, or showing how the price was set, makes that conversation much easier.

How to stay compliant in practice

• List every payment you make to overseas parties for a product line, not only the invoice for goods.
• For each one, ask whether it is an addition under the rules, and keep the reasoning on file.
• Declare assists and royalties openly on the bill of entry with supporting documents rather than waiting to be asked.
• Where you are unsure of treatment, consider an advance ruling or a written query; our guide on advance rulings explains the process.
• Keep contracts, licence agreements and bank records together, as described in our guide to import record keeping.

Common mistakes and their consequences

The typical pattern is not deliberate fraud but a gap between the purchasing team and the clearance team. Purchasing pays for moulds, samples, design and licences; the C&F agent sees only the commercial invoice. The result is an undervalued declaration that may pass at the time, then surface in an audit with demand for the unpaid duty and taxes, possible penalties, and more scrutiny on future shipments. Our article on customs penalties explains the risk. The fix is organisational: make sure whoever prepares the declaration knows about every related payment. The actual duty impact depends on your products and tariff lines, so ask us to review your specific arrangement.

Related reading: assessment value versus invoice value, customs valuation disputes, and Incoterms explained. To see how we handle sourcing, freight and clearance end to end, visit our services page, browse the shop, look at our China sourcing and buying agent service, or contact DE International for a quote built around your actual products and volumes.