Ankara, TurkeyAnkara, Turkey23 February 200523 February 2005

Tariff Classification Tariff Classification

Greetings from UK Customs!Greetings from UK Customs!

The three liability elements The three liability elements

Tariff

Classification

Valuation Origin

AspectsAspects Importance of Tariff ClassificationImportance of Tariff Classification Background to tariff structureBackground to tariff structure World Customs OrganisationWorld Customs Organisation Harmonised System NomenclatureHarmonised System Nomenclature General Rules of InterpretationGeneral Rules of Interpretation Nomenclature CommitteeNomenclature Committee OpinionsOpinions Explanatory NotesExplanatory Notes European CommunityEuropean Community Combined NomenclatureCombined Nomenclature Nomenclature Committees Nomenclature Committees Explanatory Notes Explanatory Notes EC RegulationsEC Regulations Statements in Committee minutesStatements in Committee minutes Binding Tariff InformationBinding Tariff Information Dealing with classification disputes and issues Dealing with classification disputes and issues

The importance of Tariff The importance of Tariff ClassificationClassification

Nearly all Trade policy measures are Nearly all Trade policy measures are attached to the tariff classificationattached to the tariff classification

These include import duties, preferences,These include import duties, preferences,

anti-dumping, licences,suspensions,quotas.anti-dumping, licences,suspensions,quotas. The Tariff is used as a basis for Trade The Tariff is used as a basis for Trade

Agreements- WTO- HS6Agreements- WTO- HS6 Trade statistics depend on accurate Trade statistics depend on accurate

classification – Balance of paymentsclassification – Balance of payments

The importance of getting it rightThe importance of getting it right

In the EU we can call for arrears of duty for In the EU we can call for arrears of duty for up to 3 years after the date of importationup to 3 years after the date of importation

Too late to recover from consumerToo late to recover from consumer Pay out of own pocket!!!Pay out of own pocket!!! Other attached measures might be wrongOther attached measures might be wrong

World Customs OrganisationWorld Customs Organisation

World Customs OrganisationWorld Customs Organisation

Harmonised System Nomenclature forms the core Harmonised System Nomenclature forms the core structure of over 200 countries customs tariffs structure of over 200 countries customs tariffs world-wideworld-wide

HS comprises the 4-digit Headings and 6-digit HS comprises the 4-digit Headings and 6-digit Sub-HeadingsSub-Headings

Alphabetical IndexAlphabetical Index 6 General Rules of Interpretation6 General Rules of Interpretation WCO OpinionsWCO Opinions HS Explanatory Notes HS Explanatory Notes

General Rules of InterpretationGeneral Rules of Interpretation

1 Text of Headings and Sub-Headings, and Section1 Text of Headings and Sub-Headings, and Section and Chapter Notesand Chapter Notes 2a Unassembled or unfinished goods2a Unassembled or unfinished goods 2b Mixtures – use Rule 32b Mixtures – use Rule 3 3a Most specific description3a Most specific description 3b Essential character, Sets3b Essential character, Sets 3c Equal merit – last heading in numerical order3c Equal merit – last heading in numerical order 4 Most akin4 Most akin 5a Packing specifically for the product5a Packing specifically for the product 5b Normal packaging for transport 5b Normal packaging for transport 6 Rules also apply to sub-headings 6 Rules also apply to sub-headings

SetsSets

Must be put up in sets for retail saleMust be put up in sets for retail sale Consist of at least two different articles that Consist of at least two different articles that

are classifiable in different headingsare classifiable in different headings Consist of articles put up together to meet a Consist of articles put up together to meet a

particular need or function particular need or function

PartsParts

Articles are only classified as parts of the Articles are only classified as parts of the article for which they are intended if therearticle for which they are intended if there

is no more specific headingis no more specific heading

for example car tyres are classified as such for example car tyres are classified as such in articles of rubber (Chapter 40) and not as in articles of rubber (Chapter 40) and not as parts of cars.parts of cars.

EC Combined NomenclatureEC Combined Nomenclature

EC further sub-division of HS to 8 and 10 digits and EC further sub-division of HS to 8 and 10 digits and beyondbeyond

Also used by many non-EU countries, especiallyAlso used by many non-EU countries, especially CIS, Turkey, EFTA, CARDS, MAGREB etcCIS, Turkey, EFTA, CARDS, MAGREB etc Four Customs Code Nomenclature Committees –Four Customs Code Nomenclature Committees – Agriculture/ChemicalsAgriculture/Chemicals TextilesTextiles Mechanical/ElectricalMechanical/Electrical Miscellaneous Miscellaneous

EC decisionsEC decisions

Entry in the Committee minutesEntry in the Committee minutes CN Explanatory NotesCN Explanatory Notes EC RegulationsEC Regulations Change to the CNChange to the CN Binding Tariff InformationBinding Tariff Information European Court of Justice rulingsEuropean Court of Justice rulings

Binding Tariff InformationBinding Tariff Information

A trade facilitation measure to provide legal A trade facilitation measure to provide legal certaintycertainty

Binding on customs administrationsBinding on customs administrations 6 year validity (but will become 3)6 year validity (but will become 3) Customs can revoke, but allow period of Customs can revoke, but allow period of

gracegrace Accessible on Internet (Europa)Accessible on Internet (Europa) Review and Appeals proceduresReview and Appeals procedures

Getting your voice heardGetting your voice heard

Raise issues with your customs Raise issues with your customs administration – including review and administration – including review and appeals, courtsappeals, courts

Customs administrations are more likely to Customs administrations are more likely to listen to Trade Federations/Associationslisten to Trade Federations/Associations

Possible trade representation at both EC Possible trade representation at both EC and WCO classification committees and WCO classification committees