NDTO News Article

HS 22 and HTS Updates for the New Year

The World Customs Organization (WCO) reviews the Harmonized Commodity Description and Coding System (often called a Harmonized System or HS Codes) every five years. The codes themselves are used globally to standardize and categorize products for international trade. The goal of the WCO revisions is to keep the codes up to date with constantly evolving technology and emerging global issues. Now in its seventh edition finalized in 2019, there are 351 sets of updates and modifications encompassing many products in the new version nicknamed “HS 22” (2022 being the year the changes come into effect). These updates will guide participating countries on how to modernize their own tariff systems for more consistent product classification for trade across borders.

A full list of the new HS 22 edition is linked below, but here is a sampling of new classifications categories:

3D printers
Chemicals and materials specifically controlled under international conventions
Electronic waste (e-waste)
Fully electric heavy-duty vehicles
Rapid diagnostic kits for health and medical research
Smartphones
Unmanned Aerial Vehicles (UAVs)

The new HS codes were effective January 1, 2022. With more than 200 countries impacted, it is important to understand the updates as they apply to your company and products when shipped internationally. If old classifications are used, you may find customs and regulatory delays. The US has made steps to modify the Harmonized Tariff Schedule (HTS) which is based on the HS classifications. The additions were accepted by the US International Trade Commission and signed by President Biden in December 2021. The US HTS System adopted these codes on January 27, 2022 (30 days after the presidential proclamation).

Moving forward, be sure to evaluate any global trade management software to align with new product codes. Many items may need reclassification, and if a manual process is used, take the time to ensure products have the most up-to-date classifications. Doing this will save time from shipping delays, unnecessary customs scrutiny, and government regulation issues in the long run. Experts say to pay special attention to the updates in the classification descriptions, legal notes, and product-specific descriptions, as these many have undergone revisions.

Several ND companies specializing in Unmanned Aerial Systems (UAS or drones) may find the new HS 22 codes a welcome change, as they now include tariff codes specifically for UAS and drones. UAS was previously classified as crewed aircraft, which did provide ample definitions matching this type of technology. The new codes can more accurately describe the drones in a variety of ways.

Many of the updates have to do with technological advancements, environmental issues, and dual-purpose items needing more specificity and clarifications. For a recap on HS codes, see our previous article Harmonized System Codes for Harmonized Global Trade. The NDTO can help with HS classifications and help guide your trade questions.