Engineering and Design Fees Paid Abroad: Are They Included in Turkish Customs Value? — 2026 Current Guide

Are engineering and design fees paid abroad included in Turkish customs value? Learn when these costs are treated as assists, how they are allocated and how importers can challenge an assessment in 2026.

Engineering, development and design work are often performed outside Turkey before machinery, equipment, components or finished products are imported. Turkish Customs may investigate whether the related fees must be added to the customs value.

The answer depends on who supplied the work, where it was performed, whether it was necessary for producing the imported goods and whether its value was already included in the price paid or payable.

The Turkish Ministry of Trade explains the treatment of engineering and design work in its official customs valuation guidance.

When Must Engineering and Design Fees Be Added?

Engineering and design fees may generally be added where:

1. The work was supplied directly or indirectly by the buyer;
2. It was supplied free of charge or at a reduced cost;
3. It was necessary for producing or selling the imported goods for export to Turkey;
4. It was undertaken outside Turkey;
5. Its value was not already included in the invoice price;
6. The amount can be determined objectively and quantitatively.

This is commonly referred to as an “assist” in customs valuation.

Examples include:

• Product engineering;
• Industrial design;
• Technical drawings;
• Production plans;
• Mould and tooling design;
• Engineering calculations;
• Prototype development;
• Artwork;
• Manufacturing specifications;
• Software or control designs;
• Product-development studies.

Not every professional fee paid abroad meets these conditions. The scope and purpose of the work must be examined.

Engineering Work Paid to the Seller

If the foreign supplier performs engineering or design work and charges the buyer separately, Customs may examine whether the fee is part of the price actually paid or payable.

The fee may be included where:

• It relates directly to the imported goods;
• The supplier requires payment for the sale;
• The work is necessary to produce the goods;
• It was not already included in the invoice;
• The amount can be calculated objectively.

A separate invoice does not automatically make the fee non-dutiable. The commercial connection between the service and the imported goods remains important.

Buyer-Supplied Engineering as an Assist

A buyer may provide engineering or design work to the supplier without charging the supplier. The buyer may have developed the designs internally or purchased them from a third-party engineering firm.

Potential examples include:

• A Turkish buyer provides technical plans to a foreign machine manufacturer;
• A buyer supplies mould designs for imported plastic products;
• A parent company provides engineering specifications to a group supplier;
• An importer pays an overseas design firm for drawings used to manufacture imported goods;
• A buyer supplies production software or manufacturing instructions.

If the work was necessary for producing the imported goods and its value was not included in the price, Customs may require an addition.

Where Was the Work Performed?

The place of performance can be decisive.

Engineering and design work undertaken outside Turkey may qualify as a buyer-supplied assist if the other legal conditions are satisfied.

Work performed in Turkey after importation may often be treated differently, particularly where it concerns:

• Installation;
• Assembly;
• Local adaptation;
• Commissioning;
• Maintenance;
• Technical support;
• Training;
• Repairs;
• Domestic product development.

The importer should separate pre-import production work from post-import services.

What Does “Necessary for Production” Mean?

Customs may examine whether the engineering or design work was actually used to produce the imported goods.

Evidence may include:

• Technical drawings referenced by the manufacturer;
• Production instructions;
• Product specifications;
• Bills of materials;
• Factory correspondence;
• Manufacturing records;
• Prototype approvals;
• Engineering change orders;
• Quality-control records;
• Supplier confirmations.

A general group design programme unrelated to the specific imported product may be less likely to be treated as an assist.

The importer should identify the exact products, models and production batches connected to the work.

Design Fees for Imported Machinery

For imported machinery, Customs may examine:

• Process design;
• Mechanical drawings;
• Electrical diagrams;
• Control-system design;
• Factory-layout plans;
• Tooling design;
• Commissioning specifications;
• Engineering calculations;
• Software configuration.

If the design work was necessary to manufacture the machine, its value may need to be allocated across the imported equipment.

Installation and commissioning performed in Turkey may be separately identified and potentially excluded, depending on the contractual and accounting evidence.

Product Design and Artwork

Design and artwork fees may be relevant for:

• Consumer goods;
• Furniture;
• Clothing;
• Packaging;
• Branded merchandise;
• Electronics;
• Moulded products;
• Retail products.

The importer should distinguish between:

• Design incorporated into the product;
• Packaging design;
• Advertising artwork;
• Domestic marketing;
• Brand campaigns;
• Post-import retail materials.

A fee for domestic advertising or local marketing is not automatically an addition to customs value.

Engineering, Royalties and Licence Fees

Engineering work may overlap with royalties, patents, technology licences or know-how payments.

The importer should separate:

• Engineering services;
• Design work;
• Technical assistance;
• Patent licences;
• Software licences;
• Trademark royalties;
• Manufacturing know-how;
• Post-import support.

A payment may fall under more than one customs-value provision. The company should avoid describing every payment as a general “technical fee.”

Related-Party Engineering Fees

International groups may centralise engineering and design work in a parent company or specialist affiliate.

Customs may examine:

• Group structure;
• Engineering ownership;
• Intercompany agreements;
• Cost-sharing arrangements;
• Transfer-pricing policy;
• Development costs;
• Internal invoices;
• Allocation keys;
• Project codes;
• Product-level use.

A related-party payment is not automatically included. The importer must demonstrate what work was performed, who benefited from it and how the cost was allocated.

How Is the Fee Allocated?

Engineering and design work may relate to:

• One shipment;
• Several shipments;
• Multiple product models;
• A production line;
• Goods imported over several years;
• Both imported and domestic products.

Possible allocation methods include:

• Number of units;
• Production volume;
• Product turnover;
• Machine capacity;
• Expected production life;
• Number of models;
• Contractual allocation;
• Direct project-cost allocation.

The method should be reasonable, consistent and supported by records. Customs should not impose an arbitrary amount without objective data.

Documents Turkish Customs May Request

A complete file should contain:

• Engineering contract;
• Design agreement;
• Intercompany agreement;
• Purchase contract;
• Engineering invoices;
• Payment records;
• Technical drawings;
• Plans and specifications;
• Bills of materials;
• Product-development records;
• Prototype documentation;
• Project codes;
• Time sheets;
• Cost calculations;
• Allocation schedules;
• Supplier confirmations;
• Import declarations;
• Accounting and ERP entries;
• Evidence of post-import services.

The importer should provide a clear explanation of why the fee is included or excluded.

Fees That May Be Excluded

Depending on the facts, the following may often be excluded where separately identified:

• Post-import assembly;
• Installation;
• Commissioning;
• Maintenance;
• Repairs;
• Local training;
• Domestic technical assistance;
• Local adaptation;
• Financing interest;
• Buying commissions;
• Domestic advertising.

The importer should show these amounts separately in contracts, invoices and accounting records. A single combined “engineering package” may be difficult to defend.

Customs Valuation Methods

Where the transaction value is accepted, the invoice price remains the starting point. If Customs rejects the transaction value, it may consider:

1. Identical goods;
2. Similar goods;
3. Deductive value;
4. Computed value;
5. A fallback method.

The importer should request an explanation of the method and calculation. A comparable product without the same engineering or design features may not provide a reliable benchmark.

Post-Clearance Audits

Turkish Customs may review engineering and design fees after the goods have been released. The audit may cover:

• Several import declarations;
• Multiple product models;
• Parent-company payments;
• Engineering projects;
• Royalty arrangements;
• Transfer-pricing adjustments;
• ERP and accounting records.

Under the general framework of Customs Law No. 4458, under-assessed customs duties may generally be notified within three years from the date the customs debt arose, subject to statutory exceptions.

The importer should identify the precise declarations and periods covered by the review.

Financial and Penalty Risks

If Customs concludes that an engineering or design fee was omitted, the importer may face:

• Additional customs duty;
• Import VAT on the revised customs base;
• Additional customs duties;
• Interest;
• Administrative customs penalties;
• Reassessment of earlier imports;
• Storage and financing costs.

A genuine classification or allocation error should be distinguished from intentional concealment. False invoices or knowingly incomplete declarations may create more serious risks.

How Can the Importer Challenge an Assessment?

The importer may argue that:

• The work was not necessary for producing imported goods;
• It was performed in Turkey after importation;
• It relates to domestic services;
• It was already included in the invoice;
• The fee was paid at full market value;
• The payment covers imported and domestic goods;
• Customs used an incorrect allocation;
• The calculation lacks objective data;
• The same amount was added twice;
• The penalty or limitation calculation is incorrect.

Under Article 242 of Customs Law No. 4458, an objection is generally filed within 15 days from lawful notification of the customs decision.

If the objection is rejected, proceedings may be brought before the competent tax court within the applicable procedural period. A separate suspension-of-execution request may be necessary because an objection or lawsuit does not automatically suspend collection.

Settlement may be available for certain customs debts and penalties.

2026 Compliance Checklist

International companies should:

1. Identify all engineering and design payments.
2. Determine where the work was performed.
3. Separate production work from post-import services.
4. Identify the imported goods benefiting from the work.
5. Review buyer-supplied assists.
6. Analyse royalty and licence arrangements.
7. Prepare an objective allocation method.
8. Reconcile invoices, bank records and ERP data.
9. Coordinate tax, transfer-pricing and customs positions.
10. Preserve technical records and project files.
11. Review related-party agreements.
12. Obtain legal advice before a Customs disclosure.

Frequently Asked Questions (FAQ)

1. Are engineering fees paid abroad always included in customs value?

No. Inclusion depends on the nature of the work, its connection with imported goods, who supplied it and whether the legal assist conditions are satisfied.

2. Can buyer-supplied designs be treated as assists?

Yes, if they are supplied free of charge or at reduced cost and are necessary for producing imported goods.

3. Are post-import installation services included?

They may often be excluded if separately identified and performed after the goods enter Turkey.

4. Can a parent company’s engineering costs be added?

Potentially. The importer should document the work, product connection and allocation.

5. Are general research and development costs dutiable?

Not automatically. The work must be connected to producing or selling the imported goods.

6. Can design fees for domestic advertising be added?

Generally not automatically, where they concern only domestic marketing and are unrelated to production of imported goods.

7. How should a multi-product engineering project be allocated?

The importer should use a reasonable, documented method based on production, units, models, cost or another objective factor.

8. Can software design be an engineering assist?

Yes, where it is supplied for manufacturing imported goods and its value is not already included.

9. Can Customs reassess engineering fees after clearance?

Yes. Post-clearance audits may result in additional duty, VAT, interest and penalties.

10. What is the objection deadline for an engineering-fee assessment?

An objection is generally filed within 15 days from lawful notification under Article 242 of Customs Law No. 4458.

This article is intended for general informational purposes only. To avoid any loss of rights, we recommend consulting your lawyer regarding your specific circumstances.

Legal Support for Engineering and Customs Valuation Disputes

Fırat Fesih Kaya Law Office advises foreign manufacturers, engineering firms, technology groups, Turkish importers and international investors on engineering and design fees in customs valuation.

Lawyer Fırat Fesih Kaya can assist with assist analysis, engineering contracts, design-cost allocation, royalty and licence issues, related-party payments, customs audits, additional-duty assessments, administrative objections and tax-court proceedings.

For urgent legal support:

Mobile / WhatsApp: +90 532 769 22 22
Office: +90 312 434 22 22
Email: info@firatfesihkaya.av.tr
Address: Mevlana Boulevard No: 221, Yıldırım Tower, Balgat, Çankaya / Ankara, Turkey