Argentina sanctions Huawei for failing to comply with the payment of software licenses

By Estudio Chaloupka

According to the Argentine Customs Administration, the General Agreement on Tariffs and Trade (GATT) states that it is not possible for the tech company to import hardware equipment from China to its Argentine subsidiary without paying to Huawei Tech Investment -the parent company- all software and license rights related tu such equipment.

A software license grants the legal right to use a piece of software. The use of a software product is governed by the terms and conditions stated in the license agreement as well as by copyright law.

Argentina’s regulation states that when a product ships internationally into the country, the importer must declare the value of both the hardware and the software on the commercial invoice. The value of the software license is required to be included as part of the declared value when pre-loaded on the goods being imported. This creates a complex assessment of the value of the data or instructions installed on all of the various devices or hardware being imported.

Current valuation rules are established under the GATT, which provides a Customs valuation system that primarily bases the Customs value on the transaction value of the imported goods, which is the price actually paid or payable for the goods when sold for export to the country of importation, with certain adjustments.