(a) The requirements to regard the transaction price adjusted in addition to the actual payment price of the imported goods as the dutiable value and the burden of proof as to this point, even though the royalties are not paid or payable in addition to the actual payment price of the imported goods (=the tax office)

(b) Whether the customs valuation rules (No. 89-600 of Nov. 11, 1989, notice of Korea Customs Service) are statutory (negative)

A. According to Article 7.2 (a) (b) of the General Agreement on Tariffs and Trade (GTT and Treaty No. 243), which is a treaty concluded and promulgated pursuant to the Constitution, and Articles 1 and 8.1 (c) of the Convention on Tariffs and Trade (Convention No. 729), customs value in imposing customs duties on imported goods shall be adjusted within a certain limit, i.e., the actual value of the imported goods, namely, the price actually paid or payable for the imported goods, adjusted within a certain limit. Of the “roat” and “License” related to the imported goods, a buyer is required to directly or indirectly pay the goods as the terms and conditions of transaction, but not included in the price actually paid or payable, in addition to the price actually paid or payable for the imported goods. According to the provisions of Article 9-3(1)4 of the Customs Act and Article 3-5(2) of the Enforcement Decree of the Customs Act, the duty price for the imported goods shall not be adjusted to the price of the goods actually paid or payable as the price of the goods.

B. The Customs Valuation Rule (Public Notice of Korea Customs Service No. 89-600, Nov. 11, 1989) provides that the nature and contents of the provision have the nature of an administrative order within an administrative organization issued by the Commissioner of the Korea Customs Service to establish guidelines for exercising his/her authority and authority against the relevant administrative agency and employees, and thus, it is not externally binding upon the relevant administrative agency or employees, and it is not externally binding upon the public or the court.

(a) Article VII:2.(a)(b) of the General Agreement on Tariffs and Trade (GT and Treaty No. 243), Articles 1, 8:1.(c) of the Convention on the Implementation of Article VII of the General Agreement on Tariffs and Trade (Convention No. 729), Article 9-3.1.4 of the Customs Act, Articles 3 and 3-5.2(b) of the Enforcement Decree of the Customs Act, Articles 1, 20 of the Customs Valuation Regulations (Notice No. 89-600 of Nov. 11, 1989);

Attorney Park Jong-soo et al., Counsel for the defendant-appellant-appellant

Head of Daegu Customs Office

Daegu High Court Decision 90Gu1497 delivered on September 11, 1991

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal by the defendant litigant are examined (the grounds of supplementary appeal as stated in the supplemental appellate brief not timely filed shall be limited to the extent of supplement in case of supplemental appellate brief).

1. On October 5, 1985, the lower court: (a) determined that: (b) the Plaintiff was not an affiliate company for technical goods of this case; (c) the method of calculating the royalties for the use of technical goods of this case; (d) the usage fees for the use of technical goods of this case and the usage fees for the use of technical goods of this case for the use of technical goods of this case for the use of technical goods of this case for the use of technical goods of this case No. 100 and the usage fees for the use of technical goods of this case for the use of technical goods of this case for the use of technical goods of this case for the use of technical goods of this case No. 200; and (d) the Plaintiff provided technical information of this case for the use of technical goods of this case for the use of technical goods of this case for the use of technical goods of this case for the use of technical goods of this case No. 100 and the use fees for the use fees for the use of technical goods of this case for the use of technical goods of this case No. 1.

2. According to Article VII:2(a)(b) of the General Agreement on Tariffs and Trade (GTT and Treaty No. 243), which is a treaty concluded and promulgated pursuant to the Constitution, and Articles 1 and 8:1(c) of the Convention on the Implementation of the General Agreement on Tariffs and Trade (Convention No. 729), customs value in the imposition of customs duties on imported goods adjusted within a certain limit of the price actually paid or payable for the imported goods, i.e., the actual value of the imported goods, i., the price adjusted within a certain limit of the transaction price, which is the price of the goods actually paid or payable. However, in addition to the price of the goods actually paid or payable for the imported goods, the portion that is not included in the actual price of the goods, but is not included in the price of the goods actually paid or payable by the buyer as the transaction price of the goods in question, according to Article 9-3(1)4 of the Customs Act and Article 3-5(2) of the Enforcement Decree of the Customs Act, the price of the goods in question shall not be the price of the goods in question.

Meanwhile, according to the detailed rules on customs valuation (No. 89-600 of November 11, 1989), this notice was established for the purpose of enforcing the provisions of the Customs Act, the Enforcement Decree of the same Act, the General Agreement on Tariffs and Trade, and the Convention on the Enforcement of Customs Duties. (Article 1) If the user fees for patent rights not included in the actual amount of imported goods are related to the imported goods and are paid on the condition of transaction, they shall be added to their dutiable value (Article 20(1)). If the user fees are paid for the production of finished products produced by patent rights, etc., “the case where the imported goods are materials exclusively used for the production of finished products produced by patent rights, etc.,” and “the person possessing the right of patent rights, etc. is unable to purchase the imported goods from a third party because they have exclusive production of the imported goods” and “the person who owns the right of patent rights, etc. can not be deemed to have any other relevant administrative rules and regulations concerning the purchase of the imported goods at issue or from the designated administrative agency.”

3. In addition, in light of the evidence relations as stated in the judgment of the court below, the judgment of the court below that it cannot be deemed that the royalties of this case were the terms and conditions of transaction related to the imported goods of this case is just and acceptable. In the course of the judgment of the court below, it cannot be deemed that there was an error such as theory, and there was no obligation of the plaintiff to purchase parts of the License Products under the Technology Introduction Contract with M company, on the following grounds: (a) the subject of the royalties of this case was the granting of exclusive licenses to the License Products and the provision of technical information about their manufacturing technology; and (b) the provision of technical information about the parts of the License Products was merely an incidental service; and (c) the plaintiff did not have any obligation to purchase parts of the License Products from M company under the Technology Introduction Contract with M company; and (d) other circumstances pointing out the theory alone does not affect

4. Ultimately, all the arguments criticizes the judgment of the court below on the cooking of evidence and the recognition of facts belonging to the whole jurisdiction of the court below, or do not accept the judgment of the court below on the premise that the facts recognized by the court below are inconsistent with the facts, and therefore, the defendant's appeal is dismissed and the costs of appeal are assessed against the losing defendant. It is so decided as per Disposition by the assent of

Justices Yoon Jae-ho (Presiding Justice)