As a result of the reinforced criteria applied by the customs authority regarding customs valuation and the verification of the materiality and fulfillment of obligations, it is highly advisable that import operations be supported by formal contracts entered into with suppliers and customers related to the companies’ import and export activities.
This is because having documentation that clearly and consistently describes the commercial relationship significantly facilitates the substantiation of the customs value, the agreed price, and the conditions under which the transactions are carried out, particularly in the context of reviews or audits conducted by the authorities.
In practice, contracts allow companies to strengthen the Declaration of Value and reduce the risk of observations when the commercial relationship is documented solely through purchase orders, orders, confirmations, or forecasts.
Recommended Minimum Content of Contracts
Although the law does not establish a single mandatory format, contracts should include, among others, the following elements:
- Identification of the parties (importer and foreign supplier).
- Purpose of the contract, clearly describing the commercial relationship.
- Description of the product or goods, including technical specifications when applicable.
- Applicable tariff classification.
- Delivery terms (Incoterm).
- Price, currency, and payment terms.
- Transportation and insurance conditions, where applicable.
- Term and territorial scope.
- Clauses that allow for substantiating the absence of indirect payments, royalties, or other concepts relevant to customs valuation, when applicable.
The absence of these elements may increase customs-related risks, including observations during audits or reviews, value adjustments, fines, or tax contingencies.
Risks of Not Having Adequate Contracts
- Observations during customs reviews or audits.
- Challenges regarding the correct determination of the customs value.
- Contingencies arising from documentary inconsistencies.
- Potential fines or tax assessments.
Preventive Legal Support
At EC Rubio, we advise companies on the review and structuring of international contracts, with the aim of ensuring that the commercial relationship with foreign suppliers is properly documented for customs and valuation purposes.
This preventive legal support makes it possible to anticipate observations by the authorities, avoid documentary inconsistencies, and strengthen regulatory compliance.
International Trade & Customs / Compliance
Lorena Mejía / lorena.mejia@ecrubio.com
Fernando Holguín / fernando.holguin@ecrubio.com