ITA Products and Harmonized System Jürgen Richtering Chief, Integrated Data Base Section Economic Research and Statistics Division WTO Secretariat WTO Information Technology Symposium, 29 March 2007

2 Scope of Presentation ITA product coverage Harmonized System Amendments Transposing ITA products Product lists WTO Schedules

WTO Information Technology Symposium, 29 March Product Coverage of ITA Attachment A, Section 1 Major IT products (112 items related to 110 HS6d including 24 ex) Attachment A, Section 2 Semiconductor manufacturing and testing equipment and parts (78 items related to 45 HS6d including 71 ex, incl. Att. B items) Attachment B List of specific ITA products (13 items without codes, most of them are already covered by Attachment A)

WTO Information Technology Symposium, 29 March ITA Products in WTO Schedules ITA Annex Paragraph 1 Each participant shall incorporate the measures described in paragraph 2 of the Declaration into its schedule to the General Agreement on Tariffs and Trade 1994, … ITA commitments became legal bindings reflected in participants WTO Schedules

WTO Information Technology Symposium, 29 March ITA Products in WTO Schedules Most participants have made ratifications to their Schedule by including ITA commitments at national tariff line level (more detailed than HS) Following the ITA product lists but with divergences for Attachment B products Included in the WTO Consolidated Tariff Schedule (CTS) database with ITA flag

WTO Information Technology Symposium, 29 March Harmonized System Amendments 1992 Amendment (5018 HS codes) Mainly editorial 1996 Amendment (5113 HS codes) 393 amendments 2002 Amendment (5224 HS codes) 374 amendments 2007 Amendment (5052 HS codes) 354 amendments 2012 Amendment already started A nomenclature used by most countries since Maintained by the World Customs Organization (WCO), revised every four or five years

WTO Information Technology Symposium, 29 March Coverage of HS Amendments Percentage HS subheadings involved in each HS amendment

WTO Information Technology Symposium, 29 March Implementation of HS Amendments for ITA WTO Schedules (Bound duties) Done by WTO Members / Secretariat ITA product lists: Attachment A and B to ITA Done by ITA participants / ITA Committee / Secretariat Schedules of applied tariff (Applied duties) Done by WTO Members themselves When HS amended, HS structure and codes for ITA products need to be updated in …

WTO Information Technology Symposium, 29 March Relationship between the three transpositions: bound, applied and ITA list Could be done independently Applied should conform to bound Applied/bound should conform to ITA product lists But … Divergences between ITA list and bound/applied already exist because of Attachment B products Change of the product list may result in amendment of bound or applied coverage

WTO Information Technology Symposium, 29 March Roadmap WTO Schedules Will be transposed with existing CMA procedures May be reviewed by ITA Committee ITA lists will be transposed by ITA Committee Ratification of bound Schedules may be needed when the new ITA lists are agreed

WTO Information Technology Symposium, 29 March ITA Products and HS subheadings have been affected by HS2002 ( to and ) Transposition of WTO Schedules have been done for most Participants Following procedure and methods specified in WT/L/605 Document G/IT/W/22 describes these changes in detail

WTO Information Technology Symposium, 29 March ITA Products and HS 2007 Major changes on ITA products Changes on printing machinery (84.43), ADP machines (84.71), semiconductor manufacture equipment (84.86), telecommunication products (85.17), media for recorded data (85.23), monitors (85.28) 158 of 241 subheadings have been affected 54 of 111 in Attachment A-1, 53 of 58 in A-2, and 51 of 71 in B Non-consensus correlations for printers (84.43), semiconductor equipments(84.86)

WTO Information Technology Symposium, 29 March HS 2007 Transposition of Schedules Under CMA framework Same methodologies as HS 2002 for Schedule Starting Second half of this year Methodology documents : WT/L/673

WTO Information Technology Symposium, 29 March HS 2007 Transposition of ITA Lists Technical transposition by following WCO standard correlation table Potentially increase ex items Classification divergence of Attachment B products more complicated Redefine ITA product coverage in HS2007 nomenclature May reduce ex items, cleaner list May make it easier for discussions on Attachment B items (e.g. agree full heading as ITA) Needs to be negotiated

WTO Information Technology Symposium, 29 March Example of Printers – Schedule HS2007 HS Machines which perform two or more of the functions of printing, copying or facsimile transmission, capable of connecting to an automatic.. ex * ex ex ex * ex * Correlation Table HS2002National CodeDutyITA * %No …… Yes …… Yes …… * Yes …… * %No HS2007DutyITAProduct Description %NoInk-jet printers other than PC printer (HS02 ex ) %Nophotocopying machines [indirect process] (HS02 ex ) YesOther Member As Schedule in HS 2002 Member As Schedule in HS 2007 ITA CodeDescription Input or output units... Facsimile machines Electrostatic photocopying apparatus... ITA Attachment A Section 1 Note: * No concensus for these correlations

WTO Information Technology Symposium, 29 March Example of Printers – ITA List HS2007DescriptionHS Machines which perform two or more of the functions of printing, copying or facsimile transmission, capable of connecting to an automatic.. ex * ex ex ex * ex * Correlation Table ITA Product List in HS 2002 HS2002Description Input or output units... Facsimile machines Electrostatic photocopying apparatus... ITA Attachment A Section 1 HS2002Description Input or output units... Facsimile machines Electrostatic photocopying apparatus... HS2007Description ex Machines which perform two or more of the functions of printing, copying or facsimile transmission, capable of connecting to an automatic.. Excluding:Ink-jet printers other than PC printer (HS02 ex ) and photocopying machines [indirect process] (HS02 ex ) ITA Product List in HS 2007 Note: * No concensus for these correlations

WTO Information Technology Symposium, 29 March Conclusion HS amendments have great impact to ITA products Both WTO Schedules and ITA lists need to be updated Transposition is complicated process

Thank You! WTO Information Technology Symposium, 29 March 2007