to the United States, and is, therefore, not a dutiable charge.

Inland Freight

SEC. 17. Inland freight is either a dutiable or a non-dutiable charge, depending upon the terms of sale.

Inland freight incurred on goods sold Free on Board at inland places of purchase and from there forwarded to seaboard for shipment is non-dutiable.

Inland freight incurred on goods sold at seaport is dutiable, as it is a charge incurred prior to placing the merchandise in condition packed ready for shipment to the United States.

Ocean Freight and Marine Insurance

SEC. 18. Ocean freight and marine insurance are non-dutiable charges, as they are from their very nature incurred after the merchandise has left the port of shipment for its destination in the United States.

Commissions

SEC. 19. Bona-fide commissions are non-dutiable charges. The term commissions must be understood to relate to compensation paid by the American purchaser to an agent abroad for services rendered in the purchase of merchandise for his account and benefit. It is usually fixed at some definite percentage of the actual purchase price of the merchandise, and should appear on the invoice if allowance therefor is to be claimed.

The commission may be considered bona-fide if it covers actual compensation paid or to be paid by the American purchaser to the foreign agent for

services rendered. It is not a bona-fide commission if the person representing himself to be an agent or commissionaire is in fact the seller of the goods for his own account and benefit. In such cases the socalled commission would constitute a profit to the seller and would, as such, form part of the actual selling price of the merchandise abroad.

Original Bills

SEC. 20. Difficulty is sometimes encountered in establishing the relationship of agency to the satisfaction of the appraising officer, who very naturally may desire the presentation of conclusive proofs, such as original bills showing sources from which the goods were purchased by the agent and the prices paid by him therefor. In behalf of the foreign agent or commissionaire it may be contended that his business is that of a specialist, requiring expert knowledge of market prices and conditions, quality of goods and sources from which they may be obtained to the best advantage, and that he should not therefore be required to furnish the original bills of purchase with his invoice, as to do so would disclose valuable trade information to his clients, who, after being advised as to the original sources from which the merchandise was obtained by the agent, would thereafter place their orders direct, thus depriving the agent or commissionaire of an opportunity to pursue his legitimate calling.

As to this it may be stated that the appraising officer is entitled to the fullest information obtainable in order that he may intelligently appraise the goods. If the original bills or sources of original supply are essential for that purpose, the information should be furnished.

Brokerage Charges

SEC. 21. Brokerage charges follow this same general rule. If incurred on behalf of the purchaser independent of the selling price of the goods, they are non-dutiable. If incurred by the seller or are chargeable against the goods prior to making the sale, they would form an expense incident to placing the goods in condition packed ready for shipment to the United States, and would be a dutiable charge.

Discounts

SEC. 22. Usual trade discounts specified on the invoice are not dutiable, such discounts being considered as not forming a part of the open foreign market value of the imported merchandise.

Foreign Duties Remitted on Exportation

SEC. 23. Import duties remitted by foreign governments on the exportation of merchandise while in bond are considered as forming part of the open market value of such merchandise in the country of exportation, and are therefore dutiable.

Foreign Stamp Taxes

SEC. 24. The same is true as to stamp taxes or excise taxes imposed under the laws of the country of exportation upon goods produced in that country when offered for domestic consumption, but remitted when intended for exportation, such as internal revenue taxes imposed by foreign governments on the manufacture of cigars, spirits, liquors, etc.

Foreign Drawback

SEC. 25. It is the policy of some governments to encourage the export trade by allowing a refund of duties upon the exportation of articles manufac tured or produced in such countries with the use, wholly or in part, of imported materials upon which customs duties chargeable under the laws of such countries have been paid. Such refund is denominated a drawback, and constitutes part of the dutiable value of the merchandise and should appear on the invoice if one has been allowed. (Paragraph 669, Consular Regulations, Exhibit V, Appendix.)

Necessity of Specifying Charges

SEC. 26. The inclusion of these various items on the invoice proceeds upon the theory that as the duty shall be assessed upon the actual market value or wholesale price of the merchandise at the time of exportation to the United States in the principal markets of the country from whence exported, it is essential that the invoice contain a statement setting forth the duties or taxes remitted or refunded on exportation in order that the actual open foreign market value of the goods may be ascertained.

Bounties Countervailing Duties

SEC. 27. Bounties have no reference to the open foreign market value of merchandise imported from foreign countries, but their enumeration in the invoice becomes essential in view of Paragraph E of Section IV of the Tariff Act of October 3, 1913, which provides:

"That whenever any country, dependency, colony, province, or other political subdivision of government shall pay or bestow,

directly or indirectly, any bounty or grant upon the exportation of any article or merchandise from such country, dependency, colony, province, or other political subdivision of government, and such article or merchandise is dutiable under the provisions of this Act, then upon the importation of any such article or merchandise into the United States, whether the same shall be imported directly from the country of production or otherwise, and whether such article or merchandise is imported in the same condition as when exported from the country of production or has been changed in condition by remanufacture or otherwise, there shall be levied and paid, in all such cases, in addition to the duties otherwise imposed by this Act, an additional duty equal to the net amount of such bounty or grant, however the same be paid or bestowed. The net amount of all such bounties or grants shall be from time to time ascertained, determined, and declared by the Secretary of the Treasury, who shall make all needful regulations for the identification of such articles and merchandise and for the assessment and collection of such additional duties."

(See also Paragraph 669, Consular Regulations, Exhibit V, Appendix.) Under this class may be enumerated sugar bounties such as have been paid or bestowed by foreign governments on the exportation of sugar refined or produced in those countries. Likewise bounties paid on the exportation of spirits, distilled or refined, in bond. The duties so chargeable are generally designated countervailing duties.

Foreign Export Taxes

SEC. 28. Export taxes likewise have no reference to the open foreign market value of merchandise imported from foreign countries, but become an important factor in the assessment of duties on print paper valued at above five cents per pound, as it is provided by Section 600 of the Revenue Act of September 8, 1916, amending Paragraph 322 of the Act of October 3, 1913, that: