How industry engages on classification matters at the WCOBy the International Chamber of Commerce
How does a specific product become the subject of a global classification decision at the WCO? What information is considered when amendments are made to the Harmonized System (HS) nomenclature? And how can a company or industry sector engage at the WCO to support classification decisions and HS amendments?
Involvement and information from industry is critical in making classification decisions for complex commodities and keeping the HS up to date with technological developments and changes in trade flows. Because it moves parts and finished goods around the globe, the private sector has a vested interest in the global classification decisions made by the WCO’s Harmonized System Committee (HSC).
The HSC is composed of Customs officials of Contracting Parties to the HS Convention, who provide much needed stability and predictability in Customs classification. Committee decisions, often accompanied by a classification opinion, provide guidance to Customs administrations as well as importers and exporters.
A commodity gets identified for classification when a new product starts being traded globally and is not clearly identified in the HS, if there is a classification dispute between countries, or if there are cases of a lack of uniformity in the classification. Amendments to the legal text of the HS nomenclature take place during five-year review cycles. The 2017 edition of the nomenclature is currently in effect with the next edition scheduled for implementation in January 2022.
Options for industry engagement
There are two primary methods for industry to support the classification of commodities and amendments to the HS nomenclature:
- The first option is for a company or industry organization to directly engage their home Customs administration on the classification matter. A list of HS officials in national administrations can be found on the WCO website. Technical and reference information can be provided to the Customs officials for inclusion in the working documents that support the classification decision. In addition, the Customs officials may invite technical representatives from industry to the HSC meeting to answer questions and/or give a brief presentation.
- The second option is for industry to contact the International Chamber of Commerce (ICC) either directly or through an ICC national committee. Through a Memorandum of Understanding (MOU) with the WCO, ICC participates as an observer during meetings of the HSC and its Review Sub-Committee. ICC provides reference information and non-papers in response to requests from the WCO Secretariat, and also coordinates presentations and demonstrations to support the classification of goods or amendments to the nomenclature.
ICC recently provided a non-paper on additive manufacturing (3D printing), which was the basis for an HS amendment proposal for this new technology. In addition, ICC has coordinated presentations and demonstrations for classification issues involving smartphones, smartwatches, drones, large screen monitors, multicomponent integrated circuits and tablet computers, among others.
Thus, the private sector has two established ways to express its views and be part of a collaborative approach to a successful outcome on classification matters, a collaborative approach which is vigorously championed by both the WCO and ICC, and one that has benefitted industry and Customs administrations alike.
ICC Commission on Customs and Trade Facilitation
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ICC is the world business organization, helping businesses of all sizes and in all countries to operate both internationally and responsibly. It has a global network which includes over six million members in more than 100 countries.