What is the Harmonized System (HS)?
The Harmonized Commodity Description and Coding System
generally referred to as "Harmonized System" or simply "HS"
is a multipurpose international product nomenclature developed by the World
Customs Organization (WCO).
It comprises about 5,000 commodity groups; each
identified by a six digit code, arranged in a legal and logical structure and
is supported by well-defined rules to achieve uniform classification.
The system is
used by more than 200 countries and economies as a basis for their Customs
tariffs and for the collection of international trade statistics. Over 98 % of
the merchandise in international trade is classified in terms of the HS.
The HS contributes to the harmonization of Customs and
trade procedures, and the non-documentary trade data interchange in connection
with such procedures, thus reducing the costs related to international trade.
It is also extensively used by governments,
international organizations and the private sector for many other purposes such
as internal taxes, trade policies, monitoring of controlled goods, rules of
origin, freight tariffs, transport statistics, price monitoring, quota
controls, compilation of national accounts, and economic research and analysis.
The HS is thus a universal economic language and code for goods, and an
indispensable tool for international trade.
The Harmonized System is governed by "The
International Convention on the Harmonized Commodity Description and Coding
System". The official interpretation of the HS is given in the Explanatory
Notes (5 volumes in English and French) published by the WCO. The Explanatory
Notes are also available on online and on CD-ROM, as part of a database which
groups all the available HS Tools, by adding to the information on the
Nomenclature, the Compendium of Classification Opinions and the Explanatory
Notes, that relating to the Alphabetical Index and the Brochure on
Classification Decisions taken by the Harmonized System Committee.
The maintenance of the HS is a WCO priority. This
activity includes measures to secure uniform interpretation of the HS and its
periodic updating in light of developments in technology and changes in trade
patterns. The WCO manages this process through the Harmonized System Committee
(representing the Contracting Parties to the HS Convention), which examines
policy matters, takes decisions on classification questions, settles disputes
and prepares amendments to the Explanatory Notes. The HS Committee also
prepares amendments updating the HS every 5 – 6 years.
Decisions concerning the interpretation and
application of the Harmonized System, such as classification decisions and
amendments to the Explanatory Notes or to the Compendium of Classification
Opinions, become effective two months after the approval by the HS Committee.
These are reflected in the amending supplements of the relevant WCO