TBML002U · TBML
Is a trade transaction being used to transfer value through invoice deflation below expected market value — understating the price to move value to the importer, evade duty, or settle an obligation outside the visible trade?
Under Invoicing occurs when the value of goods or services on an invoice is intentionally understated below their true market value. It is the mirror of over-invoicing: where over-invoicing moves value to the *exporter* through overpayment, under-invoicing moves value to the *importer* — the buyer receives goods worth far more than the price paid, and the difference is settled or realised outside the visible trade.
It is used to:
A customer imports goods from a counterparty at a price materially below the market benchmark. The trade documents are internally consistent, but the declared value cannot be reconciled with the commodity's benchmark price. The value gap accrues to the importer; it may be settled through a separate channel, netted against an unrelated obligation, or simply realised on resale at market price. Where the counterparty is a shell and the parties share ownership, the under-price is not a commercial discount — it is a transfer mechanism.
Curated from fc-04-tbml-analytics-toolkit/typologies/TBML002/TBML002_Under_Invoicing.md