Tariff classification

The tariff classification of goods is one of the most difficult tasks for the people who are responsible for completing the documents relating to the export or import of the goods. Although there are international rules, there are also rules in each of the countries using the Harmonized Commodity Description and Coding System. Do I need to enter a 10-digit, 8-digit or 6-digit code? Do I use the Canadian code or the code of the other country?

The Harmonized System is managed by the World Customs Organization (WCO) and is used by more than 200 countries around the world. Although the majority of these countries have 10-digit codes, some such as Mexico have only 8, and Canada will have 8 for export, 10 for imports and 6 or 8 for use on the certificate Origin of NAFTA depending on the rule of origin.

What you should know is that the first 6 digits are international and should be the same in all countries, but the tariff classification of the goods is still subject to interpretation. Thus, depending on the interpretation made in one country or the other, a decision made by one country may be completely different in another for the same product!

How to find one? There are practical tools that can help you determine the tariff classification of your goods. The first is on the USCBP website (https://rulings.cbp.gov/), the Customs Rulings Online Search System (CROSS), and you can simply insert the keyword that best defines your product, Find all decisions rendered by the USCBP. Of course, although these decisions are formal, you do not have to follow that decision if it does not suit you.

Also on the USCBP website, at the very end of the Harmonized Tariff System (HTS) there is an alphabetical index (https://hts.usitc.gov/current). These two tools can guide you to the appropriate tariff classification of your product, but you should always consider section notes, chapter notes and explanatory notes to properly determine tariff classification. In any case, it will be an opinion!

Tariff classification is the basis for customs compliance, determines the rate of customs duty to be paid on your goods, could determine whether a dumping duty could be payable, whether a supplemental declaration such as the Lacey Act is required and ultimately, Will determine the rule of origin to determine whether your product qualifies for a free trade agreement.

The best advice to give you is to mandate your customs broker to determine the correct tariff classification of your products and if necessary, to obtain a national decision from the customs authorities.

For more information do not hesitate to contact us.

Yves Lacelle, Director, Quebec Region Operations.


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