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The HS: a Multi-Purpose Tool

It may be hard to imagine what effect a small six digit code could have on international efforts to reduce global warming; or in suppressing the activities of a criminal syndicate involved in the manufacture of synthetic drugs; or on the capacity of a developing country to provide basic health care for its people.

Yet since the early 1970’s, a group of highly skilled international experts at the World Customs Organization in Brussels created and continue developing a goods nomenclature system that enables nations to monitor goods passing across their borders for these purposes and more. Without it, many national regulations and international conventions would be unable to be enforced and considerable guesswork would surround bi-lateral and multi-lateral trade negotiations.

As international trade became more complex and governments around the world demand greater effectiveness from their Customs Administrations, nations turned toward the WCO’s Harmonized Commodity Description and Coding System (Harmonized System or HS) to be a central pillar of their requirement for fiscal and regulatory compliance.  The HS has neared universal coverage, providing the strongest globally unifying trade classification tool in history.

The sophistication of international trade and the increasing concern at cross-border crime has seen the Harmonized System evolve into a multi-purpose tool – a veritable Swiss Army knife - that provides much more than ensuring that what are "apples" in one country are not "oranges" in another.

To a customs official at a frontier post checking a road transport consignment, it provides vital information to assist them to carry out their duties. Without the vital HS code there would be confusion, lengthy searches and delays. To other officials coping with waves of sea cargo, airfreight consignments or express mail, it has become a vital partner. We can expect that this dependence will increase as 21st century commercial and social demands evolve.

At the international level, the Harmonized System is based on a hierarchy of Sections, Chapters, headings and subheadings. This has given the WCO the framework to respond to the concerns of many governments and international organizations who want to take steps to counter newly emerging problems. The creation of HS codes for ozone depleting substances, precursor chemicals to manufacture illicit drugs, hazardous wastes, endangered species, chemical weapons and narcotics and psychotropic substances are examples of this responsiveness to international concerns. Multiple international conventions, agreements and initiatives rely on the HS for practical implementation at the borders.

The WCO updates the Harmonized System through a five-year review cycle. The latest version of the Harmonized System was approved in June 2019, and entered into force on 1 January 2022. In addition to input from the Members, the Harmonized System Committee and the Harmonized System Review Sub-Committee also receive input from partnerships maintained by the WCO with diverse international organizations, such as the Food and Agricultural Organization of the United Nations, and from international industry bodies. This regular renewal allows for the HS to change as new issues are raised requiring clear and appropriate responses.