By: Brandon French, Associate Attorney, BLG
The new 2022 Harmonized System (HS) nomenclature has been accepted by all parties at the Harmonized System Convention. The HS nomenclature is used as a basis for the classification of goods around the globe. Every six months, the HS Committee of the World Customs Organization (WCO) meets to discuss potential changes in the HS. These changes are often due to advancements in technology, or other important factors such as difficulty classifying items due to their unique features which were not otherwise described in the tariff schedule. All changes are compiled over a five year period and approved by the WCO membership through the HS Committee. The 2022 HS included 351 different sets of amendments that cover a range of issues.
Below are some of the key amendments in the 2022 HS:
- Smartphones: The HS Committee has addressed these items due to the fact that the proper classification was unclear. The 2022 HS will now include a subheading and Note specifically related to these devices.
- Metal Forming Machinery: Due to advances in technology, changes were made to heading 8462 to prevent classification difficulties and improve import trade statistics.
- Flat Panel Display Modules: Changes to the 2022 HS now allow for these items to be classified easier by removing the previous language that required the need to identify the final use of the products for purposes of classification.
- Health and Safety Equipment: Likely due to the recent COVID-19 pandemic, the HS Committee has amended certain HS provisions relating to diagnostic kits, placebos, and clinical trial kits. Additionally, cell cultures and cell therapy have gained more specific provisions in the latest HS nomenclature.
- Terrorism: New subheadings have been created for dual use goods that can also be used for unauthorized use. These can include, but are not limited to: (1) radioactive materials, (2) biological safety cabinets, and (3) items related to improvised explosive devices.[1]
Businesses should be aware of these numerous HS changes that will go into effect January 1, 2022. It is important that the 2022 HS nomenclature is critically reviewed to determine if any classifications have changed, or if there are additional Notes that should be analyzed. As well, Companies who believe that their products are not properly identified in the new 2022 HS nomenclature can began an internal review and start preparing documentation to request changes to the HS for their products. The HS Committee meets every six months, but information that will be reviewed during the next cycle should be prepared and submitted as soon as possible. The agencies that prepare U.S. proposals for changes to the upcoming 2027 HS are U.S. Customs and Border Protection and the U.S International Trade Commission.
For any additional inquiries, or if you would like to discuss changes in the 2022 HS nomenclature in more detail, please contact Brandon French at [email protected].
[1] Additional changes in the 2022 HS nomenclature are described in the attached release from the World Customs Organization http://www.wcoomd.org/en/media/newsroom/2020/january/the-new-2022-edition-of-the-harmonized-system-has-been-accepted.aspx.
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