This is an important reminder for all exporters (and importers, too!) to stay current on product classification numbers. Exporters need to be concerned about the accuracy of their export documents and Electronic Export Information (EEI) filing through AESDirect. Importers need to be concerned as well; using outdated classification codes can create customs clearance issues.
When one set of codes change, other codes are affected. For example, when updates are made to the U.S. Harmonized Tariff Schedule (HTS), Schedule B codes may also be affected. (Learn more about this in our article, HS, HTS and Schedule B: What's the Difference?) That's why it’s crucial to pay attention to product classification updates.
The World Customs Organization (WCO) generally updates the Harmonized Schedule (HS) nomenclature every five years. The last set of codes became effective January 2022.
This HS nomenclature is used as the basis for determining customs tariffs in more than 200 countries around the world. The HS influences U.S. HTS and Schedule B codes, and it can impact trade agreements that use tariff-change rules.
In addition to HTS and Schedule B changes inspired by these HS changes, the International Trade Commission (ITC) and U.S. Census Bureau typically publish annual editions of the codes at the beginning of every year, as well as supplements or revisions as required throughout the rest of the year. That means you should be reviewing these classifications regularly—not just every five years.
As part of your company’s year-end checklist as well as your Export Compliance Program (ECP), you should take the opportunity to review your products and classification numbers to see if they are subject to any newly announced changes.
If you’re misclassifying your products, you may be committing fraud, and you could face fines and other penalties. Fortunately, there are plenty excellent classification resources available to exporters to help you avoid that fate.
I linked to the Schedule B and HTS search tools above. In addition, Shipping Solutions Product Classification Software offers a more advanced search tool that covers:
Still unsure about your classifications?
Contact the Trade Information Center at 1-800-USA-TRAD[E] (1-800-872-8723) or contact your local Export Assistance Center, which offers a variety of great trade resources for support.
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This article was first published in November 2016 and has been updated to include current information, links and formatting.