KARACHI: The Federal Board of Revenue (FBR) has notified revised customs values for imported carbon steel seamless pipes through Valuation Ruling (VR) No. 68/2026, introducing a new methodology for customs assessment following directives issued by the Directorate General of Customs Valuation.
The latest Publication Valuation Ruling (PVR) supersedes PVR No. 62/2025 dated July 14, 2025, which had earlier been rescinded through Order-in-Revision No. 55/2025 dated October 10, 2025.
Background to the Revised Valuation
The customs values of carbon steel seamless pipes were previously determined under PVR No. 62/2025. However, the ruling was challenged under Section 25D of the Customs Act, 1969 by local manufacturers, including M/s Huffaz Seamless Pipe Industries Limited and M/s Peoples Steel Mills Limited.
Subsequently, the Director General of Customs Valuation set aside the earlier ruling and directed authorities to undertake a fresh valuation exercise. The revised assessment was required to specifically address the use of round-bar feedstock instead of London Metal Exchange (LME)-listed square billets and account for the associated differential costs.
According to the FBR, the new valuation ruling has been issued based on verifiable industry data and in compliance with the directives contained in the Order-in-Revision.
Stakeholders Participated in Valuation Process
The Directorate General of Customs Valuation conducted fresh consultations involving both local manufacturers and importers before finalising the revised customs values.
Local manufacturers argued that:
• LME billet prices relate to square construction-grade billets rather than seamless round-bar feedstock;
• Round-bar feedstock is approximately USD 180–200 per metric tonne more expensive than LME square billets;
• An additional USD 170–200 per metric tonne is incurred in converting square billets into round bars; and
• Freight costs estimated at USD 60 per metric tonne were arbitrary.
Importers, however, maintained that fabrication costs should not exceed USD 300 per metric tonne.
The FBR stated that written submissions and supporting documentation from both sides were thoroughly analysed before arriving at the final determination.
New Valuation Methodology Introduced
In accordance with Section 25(8) of the Customs Act, 1969, read with Rule 121 of the Customs Rules, 2001, the Directorate reconstructed customs values using four distinct cost components:
• LME steel billet price;
• Square-billet differential;
• Fabrication cost; and
• Actual freight charges.
Square-Billet Differential Set at USD 50 Per Tonne
The ruling noted that seamless pipes are manufactured from round continuous-cast billets rather than square billets. Based on internationally recognised industry sources, the Directorate determined that the premium for round billets is approximately USD 50 per metric tonne above square billet prices.
The FBR rejected claims by local manufacturers seeking a differential of USD 180–200 per metric tonne, stating that the higher estimates lacked sufficient documentary evidence and combined separate cost factors not necessarily applicable to commodity seamless pipes classified under HS Code 7304.3900.
New Customs Values for Steel Pipes
Under WeBOC PCT 7304.3900.1000, customs values for carbon steel seamless pipes (assorted sizes) applicable to imports from all origins will now be determined using the following formula:
LME price of steel billets + USD 50 per tonne as square-billet differential + USD 250 per tonne as fabrication cost + actual freight charges
The FBR stated that the revised methodology aims to establish a more transparent and evidence-based valuation mechanism that reflects prevailing international industry practices.
Impact on Importers and Domestic Industry
Industry observers believe the updated valuation ruling could provide greater clarity for importers while addressing concerns raised by domestic manufacturers regarding fair customs assessments.
The new valuation framework is expected to standardise customs procedures for steel pipe imports and minimise valuation disputes in the future.
The revised customs values under VR68/2026 have come into effect immediately and will be used for the assessment of relevant imports by customs authorities across Pakistan.
