march 2007 copyright © 2007 world customs organization. all rights reserved. requests and inquiries...

March 2007March 2007 Copyright © 2007 World Customs Organization. Copyright © 2007 World Customs Organization. All rights reserved. Requests and inquiriesAll rights reserved. Requests and inquiries

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HS 2007 Technology SectorHS 2007 Technology Sector

Introduction of the HS 2007Introduction of the HS 2007

and its Impact on the IT Sectorand its Impact on the IT Sector

Ron HellerRon Heller

WCO Tariff and Trade AffairsWCO Tariff and Trade Affairs

DirectorateDirectorate



HS 2007 Technology SectorHS 2007 Technology SectorExcerpt from the Excerpt from the PreamblePreamble

Desiring to facilitate international trade, Desiring to facilitate international trade, Desiring to facilitate the collection, comparison and analysis Desiring to facilitate the collection, comparison and analysis

of statistics, in particular those on international trade,of statistics, in particular those on international trade, Desiring to reduce the expense incurred by redescribing, Desiring to reduce the expense incurred by redescribing,

reclassifying and recoding goods as they move from one reclassifying and recoding goods as they move from one classification system to another in the course of international classification system to another in the course of international trade and to facilitate the standardization of trade trade and to facilitate the standardization of trade documentation and the transmission of data,documentation and the transmission of data,

Considering that changes in technology and the patterns of Considering that changes in technology and the patterns of international trade require extensive modification ot the international trade require extensive modification ot the Convention on nomenclature for the Classification of Goods in Convention on nomenclature for the Classification of Goods in Customs tariffs, done at Brussels on 15 December 1950, Customs tariffs, done at Brussels on 15 December 1950,

Considering the importance of accurate and comparable data Considering the importance of accurate and comparable data for the purposes if international trade negotiations,…for the purposes if international trade negotiations,…




Article 9Article 9

The Contracting Parties do not assume The Contracting Parties do not assume by this Convention any obligation in by this Convention any obligation in relation to rates of Customs duty.relation to rates of Customs duty.




Development of the HSDevelopment of the HS




Nomenclatures ConsultedNomenclatures ConsultedIn development of the HSIn development of the HS

Closely Related to CCCN

•CCC Nomenclature

•SITC Rev. 2

•Customs Tariff of Japan

•Tariff Nomenclature for the Latin American FTA (NABALALC)

•Nomenclature of Goods for the External Trade Statistics of the (European) Community and Statistics of Trade between Member States (NIMEXE)

./..




Nomenclatures Consulted (cont.)Nomenclatures Consulted (cont.)Not closely related to CCCN

•Customs Tariff of Canada, Import and Export Commodity Classifications

•Tariff Schedules of the United States Annotated (TSUSA), Schedule B

•International Union of Railways Standard Commodity Nomenclature (NUM)

•International Air Transport Association Worldwide Air Cargo Commodity Classification (WACCC)

•Freight Tariff of the Association of West India Trans-Atlantic Steamship Lines (WIFT)

•Standard Transportation Commodity Code (STCC)




HS Revision ProcessHS Revision Process




ProposProposalal

SecretarSecretariatiat

Review Sub-Review Sub-CommitteeCommittee

HS HS CommitteeCommittee

CounCouncilcil

Draft Draft RecommendationRecommendation

RecommendaRecommendationtion

ImplementaImplementationtion

2.5 years




HS COMMITTEE FINALIZES TEXTS (Art. 7)HS COMMITTEE FINALIZES TEXTS (Art. 7)

PREPARES A RECOMMENDATION FOR ADOPTION BY WCO PREPARES A RECOMMENDATION FOR ADOPTION BY WCO COUNCIL (Art. 8)COUNCIL (Art. 8)

RECOMMENDED AMENDMENTS NOTIFIED TO CONTRACTING RECOMMENDED AMENDMENTS NOTIFIED TO CONTRACTING PARTIES (Art. 16.1)PARTIES (Art. 16.1)

OBJECTIONS, IF ANY, TO BE FILED IN SIX MONTHS (Art. 16.3)OBJECTIONS, IF ANY, TO BE FILED IN SIX MONTHS (Art. 16.3)

FINAL LIST OF RECOMMENDED AMENDMENTS NOTIFIED FINAL LIST OF RECOMMENDED AMENDMENTS NOTIFIED THEREAFTER (Art. 16.3)THEREAFTER (Art. 16.3)

IMPLEMENTATION DATE (1 JANUARY - ABOUT TWO YEARS IMPLEMENTATION DATE (1 JANUARY - ABOUT TWO YEARS LATER) (Art. 16.4)LATER) (Art. 16.4)

ALL HS CONTRACTING PARTIES OBLIGED TO IMPLEMENT ALL HS CONTRACTING PARTIES OBLIGED TO IMPLEMENT AMENDMENTS IN CUSTOMS TARIFFS AND FOR TRADE AMENDMENTS IN CUSTOMS TARIFFS AND FOR TRADE STATISTICS (Art. 16.5)STATISTICS (Art. 16.5)




Harmonized System and IT AgreementHarmonized System and IT Agreement




Annex: Modalities and Product CoverageAnnex: Modalities and Product Coverage

Any Member of the World Trade Organization, or State or separate customs territory in Any Member of the World Trade Organization, or State or separate customs territory in the process of acceding to the WTO, may participate in the expansion of world the process of acceding to the WTO, may participate in the expansion of world trade in information technology products in accordance with the following trade in information technology products in accordance with the following modalities:modalities:

1. Each participant shall incorporate the measures described in paragraph 2 of the 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, Declaration into its schedule to the General Agreement on Tariffs and Trade 1994, and, in addition, at either its own tariff line level or the Harmonized System (1996) and, in addition, at either its own tariff line level or the Harmonized System (1996) (“HS”) 6-digit level in either its official tariff or any other published versions of the (“HS”) 6-digit level in either its official tariff or any other published versions of the tariff schedule, whichever is ordinarily used by importers and exporters. Each tariff schedule, whichever is ordinarily used by importers and exporters. Each participant that is not a Member of the WTO shall implement these measures on an participant that is not a Member of the WTO shall implement these measures on an autonomous basis, pending completion of its WTO accession, and shall incorporate autonomous basis, pending completion of its WTO accession, and shall incorporate these measures into its WTO market access schedule for goods.these measures into its WTO market access schedule for goods.




Recommendation of 25 June 1999Recommendation of 25 June 1999(2002 Amendments to the HS)(2002 Amendments to the HS)




85.4285.42 Electronic integrated circuitsElectronic integrated circuitsand microassembliesand microassemblies

8542.108542.10 Cards incorporating anCards incorporating anelectronic integrated circuitelectronic integrated circuit(“smart” cards)(“smart” cards)

2002 Amendments




85.2585.25 ...Television cameras; still image...Television cameras; still imagevideo cameras and other videovideo cameras and other videocamera recorders; digitalcamera recorders; digitalcameras.cameras.

8525.308525.30 Still image video camerasStill image video camerasand other video cameraand other video camerarecorders.recorders. ; digital cameras.; digital cameras.

2002 Amendments




Recommendation of 26 June 2004Recommendation of 26 June 2004(2007 Amendments to the HS)(2007 Amendments to the HS)




REVIEW SUB-COMMITTEE (March 2004)REVIEW SUB-COMMITTEE (March 2004)

HS COMMITTEE (May 2004)HS COMMITTEE (May 2004)

COUNCIL RECOMMENDATION (June 2004)COUNCIL RECOMMENDATION (June 2004)

FINAL LIST OF AMENDMENTS AFTER DELETING FINAL LIST OF AMENDMENTS AFTER DELETING OBJECTIONS (January 2005)OBJECTIONS (January 2005)

IMPLEMENTATION - IMPLEMENTATION - 1 January 20071 January 2007




1992 AMENDMENT1992 AMENDMENT – MAINLY EDITORIALMAINLY EDITORIAL– # of HS CODES : 5019 to 5018# of HS CODES : 5019 to 5018

1996 AMENDMENT1996 AMENDMENT– 393 SETS OF AMENDMENTS393 SETS OF AMENDMENTS– # of HS CODES : 5018 to 5113# of HS CODES : 5018 to 5113

2002 AMENDMENT2002 AMENDMENT– 374 AMENDMENTS APPROVED374 AMENDMENTS APPROVED– # of HS CODES : 5113 to 5224# of HS CODES : 5113 to 5224

2007 AMENDMENT2007 AMENDMENT– 354 AMENDMENTS APPROVED354 AMENDMENTS APPROVED– # of HS CODES : 5224 to 5052# of HS CODES : 5224 to 5052




Heading 84.43Heading 84.43Before 2007, the classification of printers, Before 2007, the classification of printers,

especially multifunctional printers, led especially multifunctional printers, led to difficulties and controversies. to difficulties and controversies. ““Traditional” printers in 84.43Traditional” printers in 84.43 Some ink-jet printers in 84.43Some ink-jet printers in 84.43 Consumer-type facsimile (fax) machines in Consumer-type facsimile (fax) machines in

85.1785.17But…




Radio-telegraphic facsimile receivers in 85.27. Radio-telegraphic facsimile receivers in 85.27.

Generally, PC printers in 84.71 (pursuant to Generally, PC printers in 84.71 (pursuant to Note 5(D) to chapter 84); whereas one large-Note 5(D) to chapter 84); whereas one large-scale digital printing device was classified by scale digital printing device was classified by the HSC in 84.43.the HSC in 84.43.

Photocopiers cited in 90.09 (2002 HS), but no Photocopiers cited in 90.09 (2002 HS), but no consensus on the classification of digital copiers consensus on the classification of digital copiers or multifunctional printer/fax/copier machines.or multifunctional printer/fax/copier machines.

Heading 84.43Heading 84.43





In 2007, heading 84.43 covers :In 2007, heading 84.43 covers : allall types of types of printersprinters allall types of types of copying machinescopying machines all facsimile (fax) machinesall facsimile (fax) machines combinationscombinations of the above of the above




A home for all “multifunctional printing A home for all “multifunctional printing machines”, machines that perform machines”, machines that perform two or more of the functions of --two or more of the functions of --

printingprinting copyingcopying facsimile transmissionfacsimile transmission





Subheading 8443.31 covers Subheading 8443.31 covers “multifunctional printing “multifunctional printing machines”, capable of machines”, capable of connecting to an ADP machine connecting to an ADP machine or to a network*.or to a network*.


* “Network” includes a telephone network (voice or data quality).




All telephonesAll telephones (mobile phones transferred from heading 85.25)(mobile phones transferred from heading 85.25)

Base stationsBase stations (for mobile phone networks)(for mobile phone networks)

Machines for the reception, conversion and Machines for the reception, conversion and transmission or regeneration of voice, transmission or regeneration of voice, imagesimagesor other data, including switching and or other data, including switching and routing apparatusrouting apparatus (from 84.71 and 85.25)(from 84.71 and 85.25)


Covers --Covers --




But But thisthis type type

Heading 85.17 Heading 85.17 (con.)(con.)

What are “base stations” of What are “base stations” of 8517.61?8517.61?

Not Not thisthis type type




Heading 85.25Heading 85.25Transmission apparatus for radio-broadcasting or Transmission apparatus for radio-broadcasting or

television. Electronic cameras, such as TV cameras, television. Electronic cameras, such as TV cameras, digital still image and motion picture cameras.digital still image and motion picture cameras.

Simplified structure : All cameras together in Simplified structure : All cameras together in one subheading (8525.80)one subheading (8525.80)

However, no longer a mention of radio-telephony and radio-telegraphy (moved to 85.17).




Monitors Monitors ProjectorsProjectors Television receiversTelevision receivers


In 2007, brings together :

In 2007, excluded from 84.71 By Note 5(v) to Chapter 84




Monitors with cathode-ray tubesMonitors with cathode-ray tubes For automatic data processing machinesFor automatic data processing machines OtherOther

Other monitorsOther monitors For automatic data processing machinesFor automatic data processing machines OtherOther

ProjectorsProjectors For automatic data processing machinesFor automatic data processing machines OtherOther

Television receiversTelevision receivers Without video display or screenWithout video display or screen Other, colourOther, colour Other, black and white or monochromeOther, black and white or monochrome

Heading 85.28Heading 85.28 New structure --New structure --

(from 84.71)(from 85.28)

(from 84.71)(from 85.28)

(from 84.71)(from 85.28)

(from 85.28)(from 85.28)(from 85.28)




Industry-Government Collaboration During the Third HS Review Cycle




New text for “combined” heading :New text for “combined” heading :

““Sound recording and reproducing Sound recording and reproducing apparatus” apparatus” Simpler subheading structureSimpler subheading structure

Heading 85.19Heading 85.19 Heading 85.19 (2002 HS)

Heading 8520 (2002 HS)




All media, whether or not recorded, i.e.All media, whether or not recorded, i.e.

Cards with magnetic stripeCards with magnetic stripe Magnetic media (discs, cassettes, video tapes, Magnetic media (discs, cassettes, video tapes,

etc.)etc.) Optical media (CD, DVD)Optical media (CD, DVD) ““Flash memories" (cards, sticks, etc.)Flash memories" (cards, sticks, etc.) ““Smart cards” with a built-in chipSmart cards” with a built-in chip

Heading 85.23 (2002 HS)

Heading 85.24 (2002 HS)

Heading 85.23 (2007 HS)

Heading 85.23

Chapter Note 4(a)

Chapter Note 4(b)




Note 6 to chapter 85 (1996 amendment)Note 6 to chapter 85 (1996 amendment)

Records, tapes and other media of heading Records, tapes and other media of heading 85.23 or 85.24 remain classified in those 85.23 or 85.24 remain classified in those headings when presented with the apparatus headings when presented with the apparatus for which they are intended.for which they are intended.

This Note does not apply to such media when they are presented with articles other than the apparatus for which they are intended.




Existing Existing Note 6 to Chapter 85 Note 6 to Chapter 85 deleted.deleted.

Consequently --Consequently -- Records, tapes and other media Records, tapes and other media

are to be classified according to are to be classified according to the GRIs. the GRIs. If presented separately, in new 85.23 If presented separately, in new 85.23 If part of a set put up for retail sale, with If part of a set put up for retail sale, with

the apparatus they accompany (GRI 3(b))the apparatus they accompany (GRI 3(b))

For example,For example,




““Machines and apparatus of a kind used Machines and apparatus of a kind used solely or principally for the manufacture solely or principally for the manufacture of semiconductor boules or wafers, of semiconductor boules or wafers, semiconductor devices, electronic semiconductor devices, electronic integrated circuits or flat panel displays; integrated circuits or flat panel displays; machines and apparatus specified in machines and apparatus specified in Note 9 (c) to this Chapter; parts and Note 9 (c) to this Chapter; parts and accessories”accessories”

New heading 84.86New heading 84.86




New heading 84.86New heading 84.86,, “Equipment for “Equipment for the manufacture of semiconductor the manufacture of semiconductor devices and flat panel displays”devices and flat panel displays”

-- brings together machinery and -- brings together machinery and equipment from many locations in the equipment from many locations in the HS.HS.

8421.19, 8424.89, 8456.10, 8456.91, 8456.99, 8462.21, 8462.29, 8479.89, 8514.10, 8514.20, 8514.30, 8543.11, 8543.89, 9010.41, 9010.42, 9010.49

… and others

…such as --




WCO SECRETARIAT’S WCO SECRETARIAT’S DELIVERABLESDELIVERABLES

Correlation tablesCorrelation tables

HS 2007 NomenclatureHS 2007 Nomenclature

Booklet “Amendments to the HS”Booklet “Amendments to the HS”

Explanatory Notes (new lay out)Explanatory Notes (new lay out)

Information to UNSD and WTOInformation to UNSD and WTO ./..




WCO SECRETARIAT’S DELIVERABLESWCO SECRETARIAT’S DELIVERABLES

Alphabetical Index and Classification Alphabetical Index and Classification OpinionsOpinions

HS Commodity Data BaseHS Commodity Data Base

Laboratory GuideLaboratory Guide

E-learning modules on HS 2007 E-learning modules on HS 2007 amendmentsamendments

Workshops in each WCO regionWorkshops in each WCO region




NOMENCLATURE AND NOMENCLATURE AND CLASSIFICATION: Amendments CLASSIFICATION: Amendments

to the Harmonized System to the Harmonized System Nomenclature Nomenclature

Effective from 1 January 2007. Effective from 1 January 2007. WCO: February 2006WCO: February 2006

Correlation Tables Contained In :




MEMBERS’ TASKSMEMBERS’ TASKS

Translation Translation (in many (in many countries)countries)

Amend Customs tariff and Amend Customs tariff and statistical nomenclaturestatistical nomenclature

Update Explanatory NotesUpdate Explanatory Notes Publish amended publicationsPublish amended publications./..




MEMBERS’ TASKSMEMBERS’ TASKS

Tariff negotiationsTariff negotiations Complete legal proceduresComplete legal procedures Revise affected regulations Revise affected regulations

etc.etc. Provide capacity buildingProvide capacity building




Looking AheadLooking Ahead




Heading 85.42Heading 85.42New structureNew structure

Electronic integrated circuitsElectronic integrated circuits Processors and controllersProcessors and controllers MemoriesMemories AmplifiersAmplifiers OtherOther

PartsParts

“Multichip integrated circuits”

[Defined by Note 5(iii) to Chapter 85]




Note 8 to Chapter 85 and MCP Agreement

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