Learn the legal consequences of undervaluing imported goods in Turkey in 2026, including additional customs duties, Article 234 penalties, customs valuation disputes, post-clearance audits, false invoice allegations, Law No. 5607 investigations and defense strategies for foreign companies.

The undervaluation of imported goods in Turkey can expose an importer to substantially more than an additional customs duty assessment. Where Turkish customs authorities determine that the customs value declared for imported goods was lower than the amount that should legally have been declared, the importer may face additional customs taxes, administrative monetary penalties, post-clearance investigations and, in more serious cases involving alleged intentional deception, a criminal investigation under Turkish anti-smuggling legislation.

For foreign companies, the most important legal distinction is between a customs valuation disagreement and deliberate customs fraud. A multinational company may incorrectly exclude a royalty, misunderstand whether an intercompany payment forms part of customs value or rely on an incorrect valuation methodology without deliberately attempting to evade customs duties. Conversely, authorities may allege that an importer intentionally used a false invoice, concealed additional payments or created a lower customs price solely to reduce the tax burden.

Turkey’s customs valuation rules are principally governed by Customs Law No. 4458 and the Customs Regulation. According to the Ministry of Trade, customs value is determined first through the transaction-value method and, where that method cannot legally be used, through the successive valuation methods prescribed by the legislation.

The factual reason for the alleged undervaluation therefore determines both the financial consequences and the appropriate legal defense.

What Is Customs Undervaluation in Turkey?

Customs undervaluation occurs where the customs value declared for imported goods is lower than the customs value that should legally have been determined under Turkish customs legislation.

This does not necessarily mean that the commercial invoice itself is false. Customs value can differ from the invoice price because the customs valuation rules may require particular amounts to be added to the price actually paid or payable.

For example, certain commissions, packing costs, assists, royalties, licence fees and proceeds accruing to the seller may have to be included where the statutory requirements are satisfied. The Ministry of Trade emphasizes that such additions must be based on objective and quantifiable data and that amounts should not be added to the transaction price unless the customs legislation specifically requires their inclusion.

Accordingly, an importer should never accept a customs undervaluation allegation without first checking whether the administration’s proposed additions are legally justified.

How Is Customs Value Determined in Turkey?

The principal method is generally the transaction value, meaning the price actually paid or payable for goods sold for export to Turkey, subject to the statutory conditions and required adjustments.

If this method cannot legally be applied, Turkish customs valuation rules provide additional methods based on identical goods, similar goods, unit or deductive value, computed value and ultimately a fallback methodology. These methods are intended to be considered in the statutory sequence rather than allowing the customs authority to choose an arbitrary replacement figure simply because it believes the declared price is low.

This can become one of the strongest defenses in a customs valuation dispute. An importer should ask why the transaction value was rejected, what evidence justified rejection and precisely how the alternative customs value was calculated.

Does a Low Invoice Price Automatically Mean Undervaluation?

No.

A price can be lower than comparable imports for legitimate commercial reasons. Long-term supply agreements, volume discounts, liquidation sales, advance payments, seasonal pricing, market-entry discounts or differences in product specifications can all produce genuine price variations.

Turkish customs may investigate a price it considers unusually low, but the importer should be given an opportunity to support the commercial reality of the transaction with documentation.

Relevant evidence can include the sales contract, purchase orders, commercial invoices, price lists, bank transfers, supplier correspondence and accounting records. Where a discount explains the price, the commercial basis and timing of that discount should also be documented.

A low transaction value and a false transaction value are therefore not the same thing.

What Happens If Turkish Customs Determines That Goods Were Undervalued?

The first consequence may be an additional customs assessment.

If customs determines that the declared value produced insufficient import duties, the authority may calculate the difference between the amount originally paid and the amount it considers legally payable.

The financial effect can extend beyond ordinary customs duty because customs value may influence other import-related taxes and financial liabilities.

The company should therefore obtain a declaration-by-declaration calculation rather than relying on a single aggregate figure provided during an audit.

The calculation should then be tested against the correct GTIP, applicable duty rates and valuation methodology.

Can Undervaluation Result in an Administrative Customs Penalty?

Yes, potentially.

Where an undervaluation results in underpaid customs duties, administrative penalty provisions under Customs Law No. 4458 may become applicable, depending on the precise factual circumstances and legal basis.

However, the customs debt and the administrative penalty should be reviewed separately. Even if additional customs duty is ultimately payable, it does not necessarily follow that every penalty imposed by the customs administration has been calculated or legally justified correctly.

The importer should therefore examine the statutory provision cited in the penalty decision, the amount of the tax difference and the methodology used to calculate the penalty.

Is Every Customs Undervaluation Case a Criminal Case?

No.

This distinction is extremely important.

A customs valuation disagreement can remain an administrative customs matter. Criminal risk becomes more serious where the authorities allege intentional conduct such as fabricated invoices, concealed payments, double invoicing or deliberately misleading customs documents.

For example, a genuine dispute over whether a royalty should be included in customs value is materially different from an allegation that the importer paid USD 500,000 for goods but deliberately submitted a USD 250,000 invoice to customs.

The first case may involve interpretation of valuation legislation. The second may give rise to allegations of deliberate customs evasion.

Foreign companies should therefore resist any attempt to treat every valuation difference as evidence of fraud.

When Can Anti-Smuggling Law No. 5607 Become Relevant?

Where customs authorities believe undervaluation was part of deliberate conduct designed to evade customs obligations, the matter may potentially be referred for investigation under Anti-Smuggling Law No. 5607.

The precise offence alleged should always be identified. It is not sufficient for authorities or advisers to describe the matter generally as “customs fraud.”

The investigation should determine what document was allegedly false, who prepared it, what price was actually paid, what the importer knew and whether there is evidence of deliberate concealment.

Customs Enforcement operates under legislation including Customs Law No. 4458, Anti-Smuggling Law No. 5607 and Criminal Procedure Code No. 5271, meaning serious customs valuation cases can potentially have both administrative and criminal dimensions.

Can Using a False Invoice Lead to Criminal Liability?

Potentially, yes.

An invoice intentionally created to show a lower price than the amount actually agreed or paid can create significantly greater risk than an ordinary valuation disagreement.

Investigators may compare the customs invoice with bank payments, accounting records, supplier records, purchase contracts and electronic correspondence.

If two invoices exist, the company should identify the purpose of each document. A pro forma invoice, revised commercial invoice or credit note may have a legitimate commercial explanation.

However, where authorities conclude that a lower invoice was deliberately created only for customs clearance while the actual commercial invoice reflected a higher payment obligation, criminal exposure can become considerably more serious.

Why Are Bank Payments So Important?

Bank records are often central in undervaluation investigations.

If the customs invoice shows EUR 200,000 but bank records show EUR 300,000 transferred to the seller, customs authorities will likely investigate the additional EUR 100,000.

The importer should be prepared to explain the difference.

The additional payment may concern another shipment, freight, services, royalties, a previous account balance or another independent contractual obligation.

Investigators should not automatically assume that every payment to a foreign seller represents hidden consideration for the imported goods.

A strong defense therefore reconciles every significant payment with the commercial documentation.

Can Royalties and Licence Fees Cause an Undervaluation Assessment?

Yes.

The Ministry of Trade confirms that certain royalties and licence fees related to imported goods can be included in customs value where the buyer must pay them, directly or indirectly, as a condition of sale and they have not already been included in the price actually paid or payable.

However, not every royalty automatically satisfies these requirements.

The analysis should examine what the royalty relates to, who receives the payment, whether it is connected to the imported goods and whether payment is genuinely a condition of the sale for export to Turkey.

This is particularly important for multinational groups dealing with branded goods, technology, pharmaceuticals and licensed manufacturing arrangements.

What About Related-Party Imports?

Related-party transactions frequently attract valuation scrutiny.

A Turkish subsidiary may purchase goods from a foreign parent company or another group entity. Customs authorities may investigate whether the relationship between the parties affected the price.

Related-party status alone does not automatically prove undervaluation.

The company may support the declared price using intercompany agreements, comparable transactions, transfer-pricing reports, pricing formulas and financial records.

Nevertheless, companies should remember that corporate transfer pricing and customs valuation are related but distinct legal systems. A price accepted for corporate income tax purposes does not automatically resolve its customs treatment.

Can Year-End Transfer Pricing Adjustments Create Customs Problems?

Potentially.

Multinational companies may adjust intercompany prices after the end of a financial period to align profitability with a transfer-pricing policy.

Where those adjustments relate to previously imported goods, customs authorities may investigate whether the original customs value remains correct.

An upward adjustment can potentially raise additional customs-duty questions, while a downward adjustment may prompt the company to investigate whether customs duties were overpaid.

For companies making systematic transfer-pricing adjustments, customs and tax teams should therefore coordinate their analysis rather than treating the adjustment solely as a corporate-tax matter.

Can Customs Reject the Transaction Value Because Similar Goods Were Imported at a Higher Price?

Not automatically.

Comparable imports may become relevant under certain customs valuation methods, but comparison requires more than finding another product with a higher price.

Quantity, commercial level, product specifications, quality, origin, timing and contractual terms can all affect price.

The transaction-value method remains the starting point under Turkish customs valuation rules, and subsequent methods become relevant when the conditions for using transaction value are not met.

An importer should therefore request clarification as to which valuation method the administration actually applied.

Can Customs Conduct a Post-Clearance Audit for Undervaluation?

Yes.

A valuation issue may arise long after goods have been released into free circulation.

Turkey’s customs authorities use post-clearance controls and data analysis to identify customs risk. This means a pricing methodology repeatedly used across several years can become the subject of later review.

A foreign company receiving one undervaluation assessment should therefore examine whether the same pricing methodology was used in previous declarations.

If so, the company should calculate its broader exposure before responding to customs.

Why Is Undervaluation Risk Particularly Important in 2026?

Turkey’s broader customs control environment remains highly active in 2026. The Ministry of Trade has emphasized the importance of reviewing import conditions based on the applicable customs tariff and import regime, while customs valuation remains one of the core elements used in determining import duties.

For foreign companies, this makes documentation especially important. A customs value used successfully in previous years should not automatically be assumed to remain defensible if the commercial agreement, payment structure or relevant customs rules have changed.

Companies engaged in related-party imports, royalty arrangements or unusual pricing structures should therefore conduct a customs valuation review before a post-clearance investigation begins.

Can Goods Be Seized in an Undervaluation Investigation?

Potentially, where the authorities believe the conduct goes beyond an ordinary administrative valuation discrepancy and forms part of a suspected offence under Law No. 5607.

Seizure is a procedural protective measure and should not automatically be confused with permanent confiscation.

If goods are seized, the company should immediately obtain the seizure documentation, identify the legal basis of the measure and determine whether continued retention can be challenged.

The company should also document the commercial condition and value of the goods, particularly where they are perishable or likely to depreciate quickly.

Can Company Directors Be Criminally Investigated?

Potentially, but corporate title alone is not sufficient to establish criminal responsibility.

Investigators may examine who approved the import, who knew the actual price, who communicated with the foreign supplier and who instructed the customs broker.

A foreign director with no operational involvement in Turkish customs matters should not automatically be treated in the same way as a manager who personally arranged the transaction.

Criminal responsibility requires individualized analysis of each person’s conduct and knowledge.

Can the Customs Broker Be Responsible?

Potentially.

The importer should determine exactly what information was given to the customs broker and what the broker independently decided.

If the company gave the broker the genuine commercial invoice but the broker incorrectly declared another amount, that may be important evidence.

Conversely, if the company deliberately provided only a lower invoice while concealing the actual purchase agreement, the factual position is entirely different.

Correspondence between the importer and customs broker should therefore be preserved immediately.

What Should a Company Do After Receiving an Undervaluation Assessment?

The company should first obtain the formal customs decision and identify the notification date.

It should then reconstruct the customs value from the beginning. The invoice, sales contract, payment records, freight and insurance documents, royalties, related-party agreements and other relevant payments should all be examined.

The company should also determine whether the disputed practice affects previous imports.

If criminal allegations are possible, the administrative customs defense and criminal defense should be coordinated carefully so that statements made in one proceeding do not contradict arguments presented in another.

Can an Undervaluation Assessment Be Appealed?

Potentially, yes.

Where Customs Law No. 4458 provides an administrative objection remedy against the relevant assessment or penalty, strict filing periods must be respected.

The objection should challenge the actual valuation methodology rather than merely arguing that the resulting tax is excessive.

If customs rejected transaction value, the importer should explain why the statutory requirements for transaction value were satisfied. If customs added royalties or other payments, the importer should challenge whether the relevant legal conditions for inclusion existed.

Where the administrative dispute remains unresolved, judicial review before the competent Turkish tax court may potentially become available under the applicable procedural rules.

Does Paying the Additional Duty End the Criminal Risk?

Not automatically.

Administrative customs debt and criminal liability should be treated separately.

Payment may have procedural or substantive consequences depending on the alleged offence and the applicable provisions, but a company should not assume that paying the additional assessment automatically closes a criminal investigation.

Likewise, payment should not be treated as an automatic admission that the company deliberately undervalued the goods.

Legal advice should be obtained before payment is used as part of a criminal-defense strategy.

What Evidence Is Most Important in an Undervaluation Defense?

The strongest defense is generally built around the commercial reality of the transaction.

The company should preserve the final commercial invoice, all pro forma invoices, purchase agreement, purchase orders, bank transfers, accounting records, freight and insurance documents, royalty agreements, transfer-pricing records and communications with the supplier and customs broker.

Where a discount or pricing adjustment explains the lower price, the documentary basis should be established clearly.

The central questions are straightforward: What was actually paid? What additional amounts were connected to the imported goods? Why was the declared customs value selected?

What Are the Biggest Mistakes Companies Make?

One of the most serious mistakes is assuming that an invoice alone proves customs value. The commercial transaction must be capable of being reconstructed through contracts, payments and accounting records.

Another mistake is treating a customs valuation disagreement as a purely accounting problem even after prosecutors become involved.

Foreign companies may also damage their position by giving inconsistent explanations in administrative and criminal proceedings.

Finally, companies should never modify invoices, recreate documents or alter historical records after learning about an investigation. Preservation of the original documentary chain is essential.

Frequently Asked Questions About Undervaluation of Imported Goods in Turkey

1. What is customs undervaluation in Turkey?

Customs undervaluation occurs where the customs value declared for imported goods is lower than the amount that should legally have been determined under Turkish customs valuation rules.

2. Does a low invoice automatically mean customs fraud?

No. Legitimate commercial reasons can explain a low price. The transaction and supporting documentation must be examined before fraud can be alleged.

3. Can undervaluation lead to additional customs duties?

Yes. If customs determines that the declared value was too low, it may assess the difference between the duties paid and the amount it considers legally payable.

4. Can customs impose an administrative penalty as well?

Potentially, yes. Customs Law No. 4458 contains penalty provisions applicable to qualifying valuation discrepancies. The debt and penalty should nevertheless be reviewed separately.

5. Can undervaluation lead to a criminal investigation under Law No. 5607?

Potentially, where authorities allege deliberate conduct such as false invoicing, concealed payments or other intentional customs evasion. An ordinary valuation disagreement should not automatically be treated as smuggling.

6. Are royalties included in customs value?

Sometimes. Qualifying royalties and licence fees may need to be included where the statutory conditions are met, including the requirement that they relate to the imported goods and are payable as a condition of sale.

7. Can related-party pricing be accepted as customs value?

Potentially. Related-party status does not automatically invalidate transaction value, but customs may investigate whether the relationship influenced the price.

8. Can company directors be investigated personally?

Potentially, where evidence connects an individual director with the allegedly unlawful conduct. Corporate title alone should not establish criminal liability.

9. Can goods be seized because of an undervaluation allegation?

Potentially, where authorities believe the conduct constitutes a suspected smuggling offence rather than merely an administrative customs valuation discrepancy.

10. Can a foreign company challenge a Turkish customs undervaluation assessment?

Potentially, yes. The company may challenge the valuation methodology and resulting assessment through the applicable administrative procedures and, where available, before the competent Turkish court.

Legal Support for Customs Undervaluation and Criminal Risk in Turkey

An allegation that imported goods were undervalued can create several distinct legal problems at the same time. The company may face additional customs duties, administrative penalties, post-clearance audits, seizure of goods and potentially a criminal investigation under Anti-Smuggling Law No. 5607.

The correct defense should therefore determine whether the disputed amount actually forms part of customs value, whether the transaction-value method was lawfully rejected and whether the authorities possess evidence of deliberate deception rather than a technical customs valuation disagreement. Turkish customs valuation rules require the statutory valuation methodology to be followed and permit additions to transaction value only where the relevant legal conditions are satisfied.

Our law office provides professional legal assistance concerning customs undervaluation, customs valuation disputes, false invoice allegations, related-party imports, royalty and licence-fee disputes, additional customs assessments, administrative penalties, Law No. 5607 investigations, seizure and confiscation risks and customs-related criminal proceedings in Turkey.

Fırat Fesih Kaya assists foreign importers, international manufacturers, investors, multinational companies and company executives with reviewing customs valuation calculations, reconstructing international transactions, challenging additional assessments and coordinating administrative customs disputes with criminal-defense proceedings.

Phone: +90 312 434 22 22
Mobile: +90 532 769 22 22
Email: info@firatfesihkaya.av.tr
Address: Mevlana Boulevard No: 221, Yıldırım Tower No: 148, 06520 Balgat, Çankaya, Ankara, Turkey

For professional legal support concerning undervaluation of imported goods, customs penalties or related criminal allegations in Turkey, you may contact our law office for a case-specific assessment of the declared customs value, additional assessment, administrative penalties and potential criminal exposure.