Background
The Ministry of Revenues introduced Customs Valuation Directive 1080/2025 (“the Directive”), in July 2025,
replacing Customs Duty and Tax Assessment Value Directive No. 158/2011(“the Previous Directive “). The
Directive aims to align the Ethiopian Customs Valuation system with the World Trade Organization’s principles
and methods, as well as with other agreements established internationally, continentally, and regionally, which
have been duly accepted and ratified.
Key Points
- Transaction Value Method
As Principle, the transaction value of imported goods is determined by the price actually paid or payable. Under
the previous Directive, if the price declared for identical or similar goods was lower than the Customs reference
value by more than 5% for importers and more than 10% for manufacturer-importers, it could trigger doubts
regarding its accuracy. Although the current Directive does not explicitly specify a percentage threshold, the
Commission may still consider doubts about the accuracy of the declared transaction value as valid grounds for
review, provided such doubts are supported by transparent market analysis.
- Method for Determining the Transaction Value of Identical and Similar Goods
If the transaction value cannot be determined using the standard method, it may be established from price data
of identical or similar goods sold to unrelated buyers under comparable conditions within 90 days of importation.
Where such a value is unavailable, it may be determined using goods sold in non-comparable quantities at the
same commercial level, or goods sold in comparable quantities at a different commercial level, or goods sold in
non-comparable quantities at a different commercial level, provided that appropriate price adjustments are made.
The Directive explicitly states these adjustments shall only be made where the declarant provides evidence
demonstrating that such price variations directly result from differences in commercial level or quantities.
In Addition, for similar goods, where two or more prices are available in the comparative pricing data, the
Directive departs from the previous approach of applying a weighted average. Instead, it provides that the customs value shall be determined by selecting, the lowest price of identical goods imported within 30 days prior
to the importation of the goods in question shall be used as the basis for valuation.
- Fallback Value Method
Where the value of goods cannot be determined using the standard valuation method, it shall instead be based
on current data available in Ethiopia. For identical or similar goods, the Directive departs from the previous
practice of applying a weighted average, instead take the lowest value of identical or similar goods imported
within the preceding 60 days as the basis for valuation.
Deductible Costs
The Directive provides that, in calculating the CIF price, any commission paid for selling the goods, profit, total
expenses incurred in the sale and expenses or fees incurred after the goods enter the country are deductible.
To compare the FOB price calculated according to the formula specified in the Directive with the FOB price
stated on the invoice, if the declarant fails to provide acceptable evidence of payment for insurance, transportation, loading, unloading, or handling costs up to the first port of entry in Ethiopia, such costs may generally be deducted and calculated in accordance with Article 14 of the Directive and Article 96 of Proclamation No.
859/2006. This departs from the previous Directive, which imposed limits on the percentage of such deductions.
Conditions for Including Additional Payments in the Transaction Value of Goods
Additional costs and payments added to the transaction value are included in accordance with the circumstances
outlined in the Directive. However, if such additional payments cannot be assessed based on tangible information and evidence, the Directive, different from the previous Directive, which specified circumstances, allows
the Commission to determine these costs using other acceptable methods it considers appropriate.
Furthermore, the Directive provides that for goods produced in a neighboring country and imported into Ethiopia, the customs duty and tax assessment value shall be calculated by including only the actual land transport
and insurance costs incurred to deliver the goods to the first point of entry into Ethiopia’s customs territory. - Elimination of Manual Declaration
Under the previous Directive, if the Tax Declaration system fails, the declarant was required to submit the information manually to the Commission. However, the Directive is silent on this issue, implicitly eliminating
manual submission. - Valuation Decision Inspection System
The Directive introduces the establishment of a control system by the Directorate to ensure that valuation decisions at all levels are made in accordance with the law and established procedures. - Appeal Procedure
The Directive clearly specifies the procedure for submitting dissatisfaction with a valuation decision. A declarant may first appeal to the Customs Appeal Review Unit of the branch office, then if still dissatisfied, escalate
the appeal to the Federal Tax Appeal Commission, and ultimately, to the Court. - Omitted Provisions
The Directive omits the responsibilities of the Directorate and other relevant bodies that were specified in the
previous Directive
