&&Film Rescue International imports undeveloped expired photographic and cinematographic film of varying age and manufacturer. The aforementioned film is imported from the United States for processing and developing in Saskatchewan. Current photo labs cannot process this type of undeveloped expired film due to chemistry required or obsolete format of film.&&&&As a result of the processing and development of the film undertaken in Saskatchewan, silver is recovered. The recovered silver is initially contained in sludge that is further refined by the domestic purchaser. The refiner pays 90% of the silver value that they refine to 99.9% purity.&&&&The issue at hand is how to properly value the imported goods as there is no sale for export to Canada. Once the undeveloped film has been processed and transferred to an electronic form of media, it is typically destroyed after a certain amount of time by Film Rescue International, as most clients do not want the originals returned. The silver&&by-product of the development process is the only good that is sold in Canada. If the American client prefers to get the film back after digital conversion, Film Rescue International exports the film back to its original owner.

&&The value for duty must be established using one of the six methods of customs valuation identified in sections 48 to 53 of the Customs Act and must be consider in sequential order.&&&&The transaction value method is ruled out as there is no sale and no price paid or payable. The transaction value method of identical goods and the transaction value method of similar goods both do not apply as there are no such sales to which a comparison can be made as there is no sale. The deductive value method does not apply as no such goods are sold in Canada. The computed value method does not apply as the production costs of the goods cannot be calculated due to the various ages of the film that are often unknown and were produced by various producers. Consequently, this results in the residual basis of appraisal being required to determine the value for duty of the subject goods as per section 53 of the Customs Act.&&&&The residual method gives the company the ability to import and to account for these goods in a flexible manner and allows for values that are fair, uniform, neutral and reflect commercial reality. Further information may be found in Departmental Memoranda D13-3-1 and D13-9-1.&&&&Information provided in the NCR request mentions that the only element of each film imported of tangible value is the troy silver contained in the silver nitrate within each film. You have provided a list of films and the amount of silver to be yielded.&&&&The silver content has been calculated for various formats of film based on the current value of 99% pure scrap silver, as posted on www.kmggold.com to determine the value for duty.&&&&The smallest film we receive regularly; Disc film&&1000 disc films is 26.4 square feet of film&&1000 square feet of film yields on average 20 ounces of silver 38461 disc films to give us 20 ounces of silver&&a single disc film has .00052 ounces of silver Current silver price 35 dollars per once&&One disc film has a value of silver of .0182 USD&&&&The largest film we receive regularly 35mm 36 exp&&1000 36 exposure films is 592 square feet of film&&1000 square feet of film yields on average 20 ounces of silver 1689 36 exposure 35mm to give us 20 ounces of silver&&a single 35mm 36 exposure film has .01184 ounces of silver Current silver price 35 dollars per ounce&&One 35mm 36 exposure film has a value of .4263 USD&&&&The above calculation used to determine the value for duty is appropriate in accordance with the application of the Residual Method.