Football (buying) Agent loses tribunal case on VAT

March 27, 2009


Source: Umbro International Ltd v. The Commissioners for Her Majesty’s Revenue & Customs (HMRC) [2009] EWHC 438 (Ch) (


Umbro (the well known sports clothing brand) appealed against the decision of a VAT Tribunal in February 2008 that rejected its claim for overpaid customs duties on its product. The facts of the case are uncontroversial, rather what was at issue was the interpretation of these facts.


The case concerned Customs duty (which is paid on the customs value of imported goods). Under the terms of Council Regulation (EEC) 2913/92 (“the Customs Code”), commission charged by the importer’s buying agent is excluded from the dutiable customs value.


Because Umbro only import and sell sport goods, they used a company (PNH Limited) to act as their buying agent from the approved Chinese manufacturers (Dongguan Haiqi Sports Garment Co Ltd (DHS)). They therefore argued that PNH’s profit mark-up should be deducted from the customs value of the final goods. HMRC however rejected this argument and suggested instead that PNH were a principal in their own right rather than an agent and just because Umbro called the relationship an agency, did not make it so [29]. The tribunal agreed with HMRC (although they criticised several aspects of their procedure) and this decision is the appeal.


Ultimately Umbro failed to meet the burden of proof and establish that PNH were an agent. Neither the level of risk faced by PNH [38] nor the fact that the commission paid by PNH was a variable mark-up [50] were definitive in themselves, however put together these factors suggested that PNH was capable of acting as a principal in their own right.  

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About Kris

Associate Professor in Sports Law, Staffordshire University; British Gymnastics Senior Coach

View all posts by Kris

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