Barter trading or countertrade: barter
International barter takes various forms. In its purest form, it consists of an exchange of goods or services of approximately equal value, without recourse to a common unit of measurement (money) to express the transaction. However, pure barter is rarely encountered nowadays. For a variety of reasons (for example bookkeeping, statistics, taxation, etc) it is hard to dispense entirely with reference to money in international trade relations. Barter usually involves more complex transactions in which the value of bartered goods is determined (for example on the basis of current world market prices) and expressed in monetary terms. However, there are situations where money does change hands. This would include, for example, cases of partial barter where part of the transaction involves a money payment
The definition of the price actually paid or payable in Article 29.3(a) of the Code indicates that payment need not necessarily take the form of a transfer of money. Thus it may be possible to apply Method 1 to barter trading cases (see the Case Study in GACV44050). Otherwise it will be necessary to consider the alternative methods of valuation (WCO AO 6.1 provides examples).
Barter or compensation deals should not be confused with certain sales transactions in which the supply of the goods, or their price, is governed by factors (conditions or considerations) extraneous to the transaction concerned. (Article 29.1(b) of the Code refers).