| Things like the HS code and all the associated costs | | | | member countries that use this coding system |
| are not necessarily the first things that come to mind | | | | cannot alter the heading or subheading in any way, |
| when people think about global trade, but they are | | | | which keeps the numbering system harmonized. |
| integral to the process of any import and export of | | | | There are more than 200 countries, customs and |
| goods and materials. If you are involved with global | | | | economic unions in total that use the HS for a |
| trade management, you must understand the | | | | number of activities related to global trade |
| Harmonized Commodity Description and Coding | | | | management. They can use it to determine the |
| System (HS) of tariff nomenclature, a | | | | landed cost and as a basis for customs tariffs, |
| globally standardized system of names and numbers | | | | collection of international trade statistics rules of |
| to classify traded products which was developed and | | | | origin, collection of internal taxes, trade negotiations, |
| maintained by the World Customs Organization, a | | | | transport tariffs and statistics, monitoring of |
| Brussels-based independent intergovernmental | | | | controlled goods and areas of customs controls and |
| organization with more than 170 member countries. | | | | procedures including risk assessment, information |
| You must also understand the landed cost of any | | | | technology and compliance. The codes have changed |
| raw materials, semi-finished and finished goods, | | | | a bit over the years, though, so it is important to be |
| including the total cost of purchasing, transporting, | | | | sure that the definition set being used for the goods |
| warehousing and distributing. | | | | or materials in question is correct for the current |
| The average person probably doesn’t know the | | | | system. |
| HS code exists, but chances are that products | | | | Understanding all the codes and performance |
| throughout their home and office were classified by | | | | measures used to determine global trade factors and |
| this coding system before making their way down | | | | examine the efficiency of an organization’s |
| the supply chain to their local store. The HS is a | | | | logistics is an integral part of managing an international |
| six-digit nomenclature consisting of four digits known | | | | commodity-based business. |
| as the heading, followed by a subheading. The 170 | | | | |