Some information on the Tariff

These are some things about the structure and use of the Tariff and the Commodity Code system posted on my twitter account in June 2011.

1. Did you know that if you have the CAS/ CUS of a chemical you can cross ref to the com/code? see ECICS the European Customs Inventory of Chemical Substances. It is an information tool managed by the European Commission's Directorate General (DG) for Taxation and Customs Union which allows users to:
• clearly and easily identify chemicals;
• classify them correctly and easily in the Combined Nomenclature;
• name them in all EU languages for regulation purposes.
It was first published in 1974 and became an activity of the Group of European Customs Laboratories in 2009. It is available freely as part of DG Taxation and Customs Union's Data Dissemination System. ECICS lists chemical names in a number of EU languages (currently mainly eleven) along with their tariff classification in the European Community's Combined Nomenclature (eight-digit CN codes). As the CN codes are based on the "Harmonized Commodity Description and Coding System" emanating from WCO, the ECICS tariff classifications are helpful throughout the world.

2. Harmonized System (HS) for commodity codes came in 1 Jan 1988 it used 200,000 commodities traded internationl to make appropiately 9,000 codes. Managed by the World Customs Organisation (WCO) to is harmonised in over 200 countries which account for 98% of world trade by value.

3. There are 21 Sections in the structure of the tariff schedule each divided into Chapters. There are 97 Chapters in all. The HS Coding system is designed so that the more developed or manufactured a product is the later it comes in the tariff. This works for Chapters and within the headings and sub-headings of chapters.

4. The General Interpretative Rules (GIRs) give 6 rules that must be used if it is not clear which commodity code number is suitable for your goods. You do not choose the commodity code with the lowest duty rate or the one that describes the goods as "other". You must look at the goods not the additional information when deciding on a code, and if in doubt, ask Customs.

5. You can receive an "opinion" from Customs, but these are not legally binding. For a legal decision you must apply for a Binding Tariff Information (BTI) Ruling.

6. The commodity code number is important because it:
* corresponds directly to the rate of import duty payable
* points to any import restrictions
* indicates if any preferential agreement applies
* relates directly to any trade policy measure affecting the import of the goods
* is used in trade statistics
* Facilitates trade negotiations, eg preference agreements
* shortens customs clearance times
* reduces the number of disputes between Customs
* increases trade supply chain security

7. You must select commodity code numbers with care - here are some tips:
1. Need full product information
2. Need access to the commodity codes
3. Use Chapter Headings
4. Use Explanatory Notes
5. The European Inventory of Chemicals
6. Know the General Interpretative Rules

Need to go further ????
Check for EBTI rulings , Tariff Notices, the Compendium of Classification Opinions, Official Journal – Commission Regulations, HS Decisions – on World Customs Organisation website

Whatever you do when classifying goods - TAKE IT SERIOUSLY!

Further reading: S&H Articles
History of Customs Duty
General Interpretative Rules - the GIRs
Brief Guide to Tariff Classification
Relevant training: Tariff Classification Explained