ECONOMIC CLASSIFICATIONS Advanced course Day 3 – first morning session Custom classifications / HS and CN Zsófia Ercsey - KSH – Hungary Marie-Madeleine Fuger - INSEE – France Hans Van Hooff - CBS - Netherlands THE CONTRACTOR IS ACTING UNDER A FRAMEWORK CONTRACT CONCLUDED WITH THE COMMISSION

Foreign trade classification Harmonized System (HS) Since 1988, revision every 5 years Classification built and managed by the WCO (World Customs Organization) Only commodities (transportable goods) A little more than 5 000 products grouped into 21 sections and 97 chapters 4 levels The sections are coded in roman numerals The chapters in 2-digits numbers (01 – 97) Headings and subheading, respectively in 4 and 6-digits numbers Very precise rules to classify imports and exports: Customs taxes 2000 pages of explanatory notes

Foreign trade classification Harmonized System (HS): Focus at the rules Rule 1 :titles of sections, Chapters and sub‑Chapters are provided for ease of reference only Rule 2: Incomplete or unfinished articles; Articles presented unassembled or disassembled Rule 3: classification of goods classifiable under two or more headings Rule 4: classification of goods when rules 1 to 3 are useless Rule 5: packing materials and packing containers Rule 6: classification of goods within the subheading

Foreign trade classification HS is updated every 5 years to: take into account change in consumption patterns Introduce new products (>50 million US $) Suppress items with low level of trade (<100 million US $) Be fitted for monitoring specific products (for environment concerns, food safety and public security) Agriculture Chemicals Reach a more simple HS (because of lower tax duties rates)

Foreign trade classification Last revision in 2012 ⇒ HS 2012 220 amendments mainly in agricultural sector (98) chemical sector (27) machinery sector (30) …. Next revision in 2017: already completed ⇒ HS 2017 234 amendments mainly in agricultural sector (among which fish and wood) - 85 - Chemical and pharmaceutical sector – 45 - Better description for ICT products (smartphones, multimedia devices) Introduction of LED lamps, hybrid vehicles

Foreign trade classification Combined nomenclature (CN) Strictly linked to HS + details About 14,400 headings (of which about 9,300 CN subheadings) organized in five hierarchical levels Same rules than HS + some specific notes Updated each year Used for Foreign trade statistics Custom duty purposes Classification rules the General Rules for the Interpretation of the Harmonized System the Section and Chapter explantory notes The relevant criteria for HS and CN are: The material (substance) The degree of transformation The function

Foreign trade classification 0407 00 Birds’ eggs, in shell, fresh, preserved or cooked - Of poultry -- For hatching 0407 00 11 --- Of turkeys or geese 0407 00 19 --- Other 0407 00 30 -- Other 0407 00 90 - Other Self-explanatory text 0407 00 Birds’ eggs, in shell, fresh, preserved or cooked 0407 00 11 Turkey or goose eggs for hatching 0407 00 19 Poultry eggs for hatching (excluding turkey or goose) 0407 00 30 Poultry eggs, in shell, fresh, preserved or cooked (excluding for hatching) 0407 00 90 Birds’ eggs, in shell, fresh, preserved or cooked (excluding for hatching)

Foreign trade classification: tools and help for classifying goods Harmonized system: http://harmonizedsystem.wcoomdpublications.org/ Combined nomenclature (CN): Ramon is a very rich source of information http://ec.europa.eu/eurostat/ramon/index.cfm?TargetUrl=DSP_PUB_WELC For the record, CN 2016: http://ec.europa.eu/eurostat/ramon/nomenclatures/index.cfm?TargetUrl=LST_CLS_DLD&StrNom=CN_2016&StrLanguageCode=EN&StrLayoutCode=HIERARCHIC

CN2016: helpful links

Thank you!