Method 1 (transaction value): export subsidies or bounties
Export subsidies or bounties are economic aid granted by governments either directly or indirectly to exporters.
They are intended to promote the production, manufacture or export of a product. Where the price has effectively been reduced by such subsidies, Method 1 is still an acceptable way of valuing the goods.
This is because the export subsidy is not a condition or consideration between the buyer and seller.
The value of the export subsidy or bounty cannot be added back into the customs value. Article 32.3 of the Code disallows any additions which are not specifically mentioned.
A subsidy cannot be equated to any of the named elements in Article 32.1. (WCO Commentary 2.1 refers).