Transposition of Members'
CTS Files to the HS 2012 nomenclature:
notes on methodology
ADOPTED ON 11 OCTOBER 2016
Table of Contents
Introduction.. 2
1
dESCRIPTION OF HS 2012 changes. 2
1.1 One-to-one relationships. 3
1.2 Split 3
1.3 Merger 4
1.4 Complex cases. 4
2
Introducing HS 2012 changes in WTO schedules. 5
3
methodology for Processing HS 2012 changes. 8
4
The need for simplification.. 10
5
proposed steps to simplify the HS 2012 transposition.. 11
5.1 INRs and legal instruments. 11
5.2 Take into consideration Members'
transpositions in their applied tariffs. 12
5.3 Simplified correlations. 12
5.4 Correlations without clear codes. 16
5.5 Coding conventions. 17
5.6 Agriculture vs. non-agriculture
breakdown. 17
6
FORMAT AND CONTENTS OF THE hs 2012 TRANSPOSITION FILES. 18
7
verification of members' submissions. 20
7.1 Processing and formatting. 20
7.2 Consistency of submissions. 20
7.3 Compare submissions with the standard
WCO's correlation table. 20
ANNEX:
HS 2012 to HS 2007 correlations. 23
1. This
document describes the methodological guidelines that the Secretariat intends
to follow for the implementation of the HS 2012 transposition. The
procedural and the general technical aspects of this project were adopted by
the General Council Decision of 30 November 2011 (hereafter the "HS 2012
Decision")[1]. Under this project, the Secretariat will
assist developing country Members in preparing their submissions for the HS
2012 transposition exercise and verify the submissions provided by developed
country Members and developing country Members that have prepared their own
submissions.
2. This
document provides a detailed description of the methodology that the
Secretariat will follow in the HS 2012 transposition exercise, which is identical to the one used for the HS 2007
transposition. It builds on the
experience gained from previous transpositions and includes measures proposed
to improve the efficiency and quality of the work, including several
simplifications of the transposition process and a standard procedure for
verifying Members' submissions.
3. This
document is organized in seven sections. Section 1 provides an overview of the
HS 2012 amendments and a categorization of those changes. The manner in which these changes will be
introduced into the WTO Schedules of concessions is further elaborated in
Section 2 with detailed examples.
Section 3 describes the general methodology that the Secretariat will
follow in the transposition. Section 4
discusses some methodological issues that were identified in the context of the
HS 2002 and HS 2007 transpositions, and concludes that certain simplifications
that are in line with the general mandate might be required in order to avoid
unnecessary complexity in the resulting HS 2012 schedules, as well to
preserve a better link to the Members' applied nomenclatures. Section 5 follows by describing the proposed
simplifications. Section 6 presents the
format of the transposition file, and Section 7 describes the general procedure
that will be followed by the Secretariat for verifying Members' submissions. Lastly, the Annex presents the complete HS
2012 to 2007 correlation table, including comments outlining possible
simplifications.
1.1. The
Harmonized System 2012 is the fifth major amendment of the HS since its entry
into force in 1988. The 2012 revision
contains 220 sets of amendments, which results in an increase of the overall
number of HS subheadings from 5,052 to 5,205.
The Contracting Parties to the HS Convention made these amendments in
order to better reflect changes in trade patterns, technological progress,
social and environmental needs, and other textual amendments and structural
simplifications.
1.2. Depending
on the impact of the amendments on the product coverage of one or more related
subheadings, these amendments can be classified as:
(a) clarifying changes,
which do not alter the scope of the HS subheadings concerned, and
(b)
structural changes,
which relate to changes that alter the product coverage of one or more HS
subheadings.
1.3. Over a third of the HS 2012 amendments are clarifying
changes, which normally take the form of a revision of
Section/Chapter/subheading notes or description of subheadings, or a correction
of typographical errors. The
implementation of clarifying changes is straightforward and can be transposed
by a computer program that simply replaces the old texts with the new texts as
specified in the HS 2012 amendment.
1.4.
Thus the transposition work will mainly focus on the remaining structural
changes, which normally create or delete HS subheadings, or change the
codes or descriptions of HS subheadings.
In some cases structural changes could also include a revision of
Section/Chapter or subheading notes, which leads to a change of product
coverage in one or several of its HS subheadings.
1.5. The
structural changes of HS 2012 are defined by 617 pairs of correlations in the
concordance table that have been published by the Secretariat of the World
Customs Organization (WCO)[2].
Of these, 305 HS 2007 subheadings are affected by the HS 2012 transposition, of
which 175 do not exist anymore in the newer version, while 130 6-digit codes
were reused but the product scope was modified. Some 329 new subheadings were
created in HS 2012. Depending on the relationships between HS 2007 and HS
2012 subheadings, as well as the complexity of the changes, the correlations
can be categorized as:
(1) one-to-one relationships,
where one HS 2007 subheading corresponds exactly to one HS 2012
subheading,
(2) splitting
of one HS 2007 subheading into two or more HS 2012 subheadings,
(3) merging
two or more HS 2007 subheadings into one HS 2012 subheading, or
(4) more complex cases, involving
both splitting and merging of whole or part of different HS 2007
subheadings.
1.6. The
extract of the correlation table provided by the WCO below illustrates a
one-to-one relationship. The first column on the left lists HS 2012 subheadings
whose product scope were changed or have been introduced as new entries. The
second column presents the corresponding HS 2007 codes, which may contain an
"ex" prefix to indicate that the corresponding HS 2012 entry contains
only part of the referenced subheading. Remarks by the WCO are shown in the
third column and briefly specify the explanation of the change.
Table 1: Example of
a one-to-one relationship
2012 version
|
2007 version
|
Remarks in WCO's concordance
table
|
2008.93
|
ex2008.99
|
Creation of new subheading 2008.93 for cranberries.
Subheading 2008.92 has been renumbered as 2008.97.
|
2008.97
|
2008.92
|
2008.99
|
ex2008.99
|
HS 2012
|
Product
description
|
|
HS 2007
|
Product
description
|
|
-
Other, including mixtures other than those of subheading 2008.19 :
|
|
|
-
Other, including mixtures other than those of subheading 2008.19:
|
2008.91
|
--
Palm hearts
|
|
2008.91
|
--
Palm hearts
|
2008.93
|
--
Cranberries (Vaccinium …)
|
|
|
|
2008.97
|
-- Mixtures
|
|
2008.92
|
-- Mixtures
|
2008.99
|
--
Other
|
|
2008.99
|
--
Other
|
|
|
|
|
|
1.7. In
this case, HS 2012 Subheading 2008.97 originates from only one HS 2007
subheading, which is not prefixed, and
is entirely transferred to only one HS 2012 subheading. This is a one‑to‑one
relationship where the product coverage of HS 2012 subheading 2008.97 is
exactly the same as HS 2007 subheading 2008.92; i.e. a simple renumbering of
the subheading is done.
1.8. Note
that part of (ex) HS 2007 subheading 2008.99 (other) is assigned to HS 2012
subheading 2008.93 (cranberries) and the remaining part (ex) that is retained
in code 2008.99 is redefined in the HS 2012 version. To make it clear that only "part
of" a subheading is assigned to another subheading, the HS 2007 subheading
is prefixed by "ex". Although HS 2012 subheading 2008.93
originates from only one HS 2007 subheading, this is not a one-to-one
relationship since the corresponding HS 2007 subheading is split into more than
one HS 2012 subheading.
1.9. A split takes place when the products covered
by one subheading are divided into at least two new or reused subheadings; this
can be seen as a one-to-many relationship. In the example below, HS 2012
subheadings 1001.11 and 1001.19 are derived from HS 2007 subheading
1001.10 which was split to differentiate between seeds and other; the HS 2007
code is deleted as a subheading and, in this case, becomes an explanatory entry
(header) in HS 2012.
Table 2: Example of
a split2012 version
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
1001.11
|
ex1001.10
|
Subheadings 1001.10 and 1001.90 have been subdivided to
provide separately for seeds of durum wheat and other wheat and meslin
|
1001.19
|
ex1001.10
|
1001.91
|
ex1001.90
|
1001.99
|
ex1001.90
|
HS 2012
|
Product
description
|
|
HS 2007
|
Product
description
|
1001
|
Wheat
and meslin
|
|
1001
|
Wheat
and meslin
|
1001.1
|
-
Durum wheat
|
|
1001.10
|
-
Durum wheat
|
1001.11
|
--
Seed
|
|
|
|
1001.19
|
--
Other
|
|
|
|
1001.9
|
-
Other
|
|
1001.90
|
-
Other
|
1001.91
|
--
Seed
|
|
|
|
1001.99
|
--
Other
|
|
|
|
1.10. Mergers
usually result from simplifications where the distinction of products is no
longer maintained in the new nomenclature; in general this is due to the low
volume of trade in one or more of the concerned subheadings. Since several
subheadings are merged into one, it may be seen as a many-to-one
relationship.
Table 3: Example of
a merge
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
9109.10
|
9109.11
|
Subheadings 9109.11 and 9109.19 have been merged into new
subheading 9109.10 because of the low volume of trade
|
|
9109.19
|
HS 2012
|
Product
description
|
|
HS 2007
|
Product
description
|
9109
|
Clock
movements, complete and assembled
|
|
9109
|
Clock
movements, complete and assembled
|
9109.10
|
-
Electrically operated
|
|
9109.1
|
-
Electrically operated
|
|
|
|
9109.11
|
--
Of alarm clocks
|
|
|
|
9109.19
|
--
Other
|
9109.90
|
-
Other
|
|
9109.90
|
-
Other
|
1.11. A
complex case is a many-to-many relationship where both splitting and merging of
whole or part of different HS 2007 subheadings into several HS 2012
subheadings occurs at the same time.
Table 4: Example of
a complex case
2012
version
|
2007 version
|
Remarks in WCO's
concordance table
|
0101.21
|
ex0101.10
|
Subdivision of subheading
0101.10 to provide separately for horses and asses.
Amendment adopted as a result
of the FAO proposal to enhance the monitoring of the good global security.
|
0101.29
|
ex0101.90
|
0101.30
|
ex0101.10
|
|
ex0101.90
|
0101.90
|
ex0101.90
|
HS 2012
|
Product
description
|
|
HS 2007
|
Product
description
|
0101
|
Live horses, asses, mules and hinnies.
|
|
0101
|
Live horses, asses, mules and hinnies.
|
0101.2
|
- Horses :
|
|
|
|
0101.21
|
-- Pure-bred breeding animals
|
|
0101.10
|
-
Pure-bred breeding animals
|
0101.29
|
-- Other
|
|
0101.90
|
-
Other
|
0101.30
|
-
Asses
|
|
|
|
|
|
|
|
|
0101.90
|
-
Other
|
|
|
|
1.12. In this case, HS 2007 subheading 0101.10 is
split into two HS 2012 subheadings and HS 2007 subheading 0101.90 is split
into three HS 2012 subheadings. At the
same time, both part of 0101.10 and part of 0101.90 are merged into HS 2012
subheading 0101.30.
2.1. When
introducing HS changes into WTO schedules of concessions, paragraph 4 of the
HS 2012 Decision provides the guiding principle to be observed in the
transposition exercise: to the extent possible, the existing concessions (e.g.
bound duties, ODCs, INRs, etc.) should be maintained
unchanged. In other words, the scope
of the concessions should remain unaltered in both versions of the
nomenclature. Any ambiguity in the scope
that could result from the introduction of an HS amendment should normally be
addressed through the introduction of (new) national tariff line breakouts
based on the previous version of the HS.
2.2. The
types of changes discussed in section I above constitute a framework that
facilitates the tracking of modifications from HS 2007 into HS 2012 and
facilitate the understanding of the explanations by the WCO. One way of doing
this is to look first at the HS 2007 subheading and then focus on the relevant
HS 2012 subheading(s) where the specific product should be allocated. An
alternative approach is to start with the HS 2012 subheading and then search
for the relevant HS 2007 subheading(s) that they originate from.
2.3. In
case a Member has a ceiling binding of 20 per cent for agricultural products
and 10 per cent for non-agricultural product, the transposition of
the Member's commitments would be relatively straight forward. It would only be
necessary to classify the HS 2012 subheadings in agricultural and
non-agricultural products and then reflect the concessions according to these
two sectors. It would not be necessary
to have a detailed description of where an HS 2007 subheading goes in the 2012
nomenclature.
2.4. In
the approach proposed by the Secretariat, the transposition of Members'
commitments starts with the standard HS 2012 nomenclature, which is then linked
to the corresponding national tariff lines in HS 2007 via the WCO's 6-digit
correlation table. The specific concessions are identified and, where relevant,
breakouts are created whenever the concessions within a particular subheading
are different. A correlation table describing how the HS 2012 tariff lines are
linked to the national HS 2007 lines is also produced for transparency.
2.5. In
the example below, HS 2012 Subheading 1001.19 originates from HS 2007
subheading 1001.10 (see Table 2 above), which is broken down into three
national tariff lines. These three
national tariff lines are called "candidate lines". In the WCO correlation
table, the HS 2007 subheading is prefixed with an "ex" to
indicate that HS 2012 subheading 1001.19 originates from only part of the
products covered by HS 2007 subheading 1001.10. To identify which of the three
national tariff lines should be assigned to the HS 2012 subheading, a
comparison of the product scope in both versions of the HS needs to be
undertaken on a case‑by‑case basis; i.e. a manual correlation – as opposed to
automatic – has to be carried out.[3]
Case 1.a: All
candidate lines with identical level of commitments
HS
2012
|
Product
description
|
HS
2007
|
Product
description
|
Duty
|
INR
|
1001.1
|
-
Durum wheat
|
1001.10
|
- Durum wheat
|
|
|
1001.11
|
- - Seed
|
1001.1010
|
- - For animal feed
|
5
|
A
|
|
|
1001.1020
|
- - For sowing
|
5
|
A
|
|
|
1001.1090
|
-
- Other
|
5
|
A
|
1001.19
|
- - Other
|
1001.1010
|
- - For animal feed
|
5
|
A
|
|
|
1001.1020
|
-
- For sowing
|
5
|
A
|
|
|
1001.1090
|
-
- Other
|
5
|
A
|
2.6. The
comparison of product descriptions in both versions shows that HS 2012 subheading 1001.19
originates from two national tariff lines (1001.1010 and 1001.1090), which
means that the remaining third candidate line should be discarded. However, in
this specific situation, the commitments contained on each of the national
tariff lines are identical for all three candidate lines. Consequently, whether
only two or all candidate lines are retained, the duty level that would
correspond for HS 2012 subheading 1001.19 is 5 per cent with an INR for Member
"A". Hence, whenever the
concessions are identical for all candidate lines the exact identification of
national tariff lines that have to be retained is not necessary and the
transposition can be done through an automatic program without recurring to a
manual transposition. The corresponding correlation that will be created by the
program, which is used for tracking purposes, would not be entirely correct for
the precise allocation of products between both nomenclatures, but this will
have no impact on the Member's commitments in the new version of the HS.
Case 1.b: All
candidate lines with identical level of commitments, transposition to HS 2012
HS 2012
|
|
Duty
|
INR
|
HS 2007
|
|
Duty
|
INR
|
1001.1
|
- Durum wheat
|
|
|
1001.10
|
- Durum wheat
|
|
|
1001.1100
|
-- Seed
|
5
|
A
|
1001.1010
|
- - For animal feed
|
5
|
A
|
|
|
|
|
1001.1020
|
- - For sowing
|
5
|
A
|
|
|
|
|
1001.1090
|
- - Other
|
5
|
A
|
1001.1900
|
-- Other
|
5
|
A
|
1001.1010
|
- - For animal feed
|
5
|
A
|
|
|
|
|
1001.1020
|
- - For sowing
|
5
|
A
|
|
|
|
|
1001.1090
|
- - Other
|
5
|
A
|
2.7. The
situation is different when the concessions for the candidate lines within a
subheading are different; candidate lines for deletion have to be identified
and breakouts in HS 2012 have to be created to reflect the different levels of
such concessions.
Case 1.c: Candidate
lines with different level of commitments
HS 2012
|
|
Duty
|
INR
|
HS 2007
|
|
Duty
|
INR
|
1001.1
|
- Durum wheat
|
|
|
1001.10
|
- Durum wheat
|
|
|
|
|
|
|
1001.1010
|
- - For animal feed
|
5
|
A
|
1001.1100
|
- - Seed
|
5
|
A
|
1001.1020
|
- - For sowing
|
5
|
A
|
|
|
|
|
1001.1090
|
- - Other
|
4
|
A
|
1001.19
|
- - Other
|
|
|
|
|
|
|
1001.1910
|
- - - For animal feed
|
5
|
A
|
1001.1010
|
- - For animal
feed
|
5
|
A
|
|
|
|
|
1001.1020
|
- - For sowing
|
5
|
A
|
1001.1990
|
- - - Other
|
4
|
A
|
1001.1090
|
- - Other
|
4
|
A
|
Case 2: The case of a one-to-one relationship
was introduced in Table 1. An HS 2007 subheading was entirely transferred to a
single HS 2012 subheading and the latter originates from only one HS 2007
subheading. This means that there is no
change in the product scope for these subheadings and a simple renumbering is
done. This change can be introduced in a schedule of concessions by
substituting the HS 2007 code with the new HS 2012 code. If there are national
breakouts under the affected subheadings, the first six digits of the national
codes are replaced.
Case 2: One-to-one
relationship
HS 2012
|
Product description
|
Duty
|
INR
|
HS 2007
|
Product description
|
Duty
|
INR
|
2008.97
|
-- Mixtures
|
|
|
2008.92
|
-- Mixtures
|
|
|
2008.971
|
--- with added spirit
|
|
|
2008.921
|
--- with added spirit
|
|
|
2008.9711
|
---- Tropical fruit
|
5
|
A
|
2008.9211
|
---- Tropical fruit
|
5
|
A
|
2008.9719
|
---- Other
|
0
|
B
|
2008.9219
|
---- Other
|
0
|
B
|
2008.9790
|
--- Other
|
5
|
C
|
2008.9290
|
--- Other
|
5
|
C
|
Case 3: In this case multiple HS
2007 subheadings are entirely merged into a single HS 2012 subheading (none of
the HS 2007 are prefixed), i.e. all the products covered by the HS 2007
subheadings are fully transferred to one, and only one, HS 2012 subheading.
2.8. The
example below shows that two HS 2007 subheadings are transferred to HS 2012
subheading 9109.10 where they need to be recorded in terms of HS 2012 codes
(see Table 3 for the 6-digit correlation). National headers (7-digit codes)
corresponding to each one of the HS 2007 subheading are first introduced under
the HS 2012 subheading and the national tariff lines are listed under each
national header. Thus, there is no need to create national breakouts by comparing
product scope in each version of the HS.
Case 3.a: The
entirety of HS 2007 subheadings are transferred to a single HS 2012 subheading
HS2012
|
Product description
|
HS
2007
|
|
Duty
|
INR
|
9109
|
Clock movements, complete and
assembled
|
9109
|
Clock movements, complete and
assembled
|
|
|
9109.10
|
- Electrically operated
|
9109.1
|
- Electrically operated
|
|
|
|
|
9109.11
|
--
Of alarm clocks
|
5
|
A
|
|
|
9109.1110
|
--- With opto-electronic display
|
|
|
|
|
9109.1190
|
--- Other
|
0
|
B
|
|
|
9109.19
|
-- Other
|
|
|
|
|
9109.191
|
--- Of a width < 50 mm
|
|
|
|
|
9109.1911
|
----
For use in civil aircraft
|
5
|
B
|
|
|
9109.1919
|
---- Other
|
0
|
C
|
|
|
9109.1990
|
--- Other
|
5
|
B
|
Case 3.b: The
entirety of HS 2007 subheadings are transferred to a single HS 2012 subheading,
transposition to HS 2012
HS2012
|
Product description
|
Duty
|
INR
|
HS 2007
|
Duty
|
INR
|
9109
|
Clock
movements, complete and assembled
|
|
|
9109
|
|
|
9109.10
|
-
Electrically operated
|
|
|
9109.1
|
|
|
9109.101
|
-- Of alarm clocks
|
|
|
9109.11
|
|
|
9109.10110
|
--- With opto-electronic
display
|
5
|
A
|
9109.1110
|
5
|
A
|
9109.10190
|
--- Other
|
0
|
B
|
9109.1190
|
0
|
B
|
9109.109
|
--
Other
|
|
|
9109.19
|
|
|
9109.1091
|
--- Of a width < 50 mm
|
|
|
9109.191
|
|
|
9109.10911
|
---- For use in civil aircraft
|
5
|
B
|
9109.1911
|
5
|
B
|
9109.10919
|
---- Other
|
0
|
C
|
9109.1919
|
0
|
C
|
9109.10990
|
--- Other
|
5
|
B
|
9109.1990
|
5
|
B
|
Case 4: A slight variation of case 3 where
automatic transposition could also be used is when the concessions are
identical at the level of each of the HS 2007 subheadings, and one or more of
the HS 2007 subheadings are prefixed with "ex". Consider HS 2012
subheading 8456.90 which originates from a full HS 2007 subheading (8456.90)
and part of 8479.89.
Case 4.a: Identical
level of commitments for each of the HS 2007 subheadings
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
8456.90
|
8456.90
ex8479.89
|
The scope of heading 84.56 was expanded to cover also
water-jet cutting machines.
|
HS2012
|
Product description
|
HS 2007
|
Product description
|
Duty
|
INR
|
8456.90
|
- Other
|
8479.89
|
-- Other
|
|
|
|
|
8479.8910
|
--- Air purifiers
|
0
|
B
|
|
|
8479.8920
|
--- Machines for plating by
dipping
|
0
|
B
|
|
|
8479.8930
|
--- Machines for glazing
ceramics
|
0
|
B
|
|
|
8479.8990
|
--- Other
|
0
|
B
|
|
|
8456.90
|
- Other
|
|
|
|
|
8456.9010
|
-- Numerically controlled
|
5
|
A
|
|
|
8456.9090
|
-- Other
|
5
|
A
|
2.9. In
the example above, HS 2007 subheading 8479.89 consists of 4 national tariff
lines. To reflect the level of commitment in HS 2012, the national tariff
line(s) where "water-jet cutting machines" are classified within
8479.89 has (have) to be identified.
HS2007 Subheading 8479.89 if prefixed in the correlation table and only
part of this subheading should be transferred to HS2012 subheading 8456.90. The
commitments are identical within each subheading, which means that an analysis
of the product scope in HS 2007 is not necessary to correctly reflect the
concessions in HS 2012 as shown in the table below.
Case 4.b: Identical
level of concessions for each of the HS 2007 subheadings, transposition to
HS 2012
HS2012
|
Product description
|
Duty
|
INR
|
HS 2007
|
Duty
|
INR
|
8456.90
|
- Other
|
|
|
8479.89
|
|
|
8456.9010
|
-- Water-jet cutting
machines
|
0
|
B
|
8479.8910
|
0
|
B
|
|
|
|
|
8479.8920
|
0
|
B
|
|
|
|
|
8479.8930
|
0
|
B
|
|
|
|
|
8479.8990
|
0
|
B
|
|
|
|
|
8456.90
|
|
|
8456.9090
|
-- Other
|
5
|
A
|
8456.9010
|
5
|
A
|
|
|
|
|
8456.9090
|
5
|
A
|
2.10. The
correlation table that traces the transfer of products from HS 2007 into HS
2012 needs to identify all the national tariff lines in HS 2007 that are
possibly concerned. Whether or not all candidate lines are retained will not
affect the level of concessions when they are expressed in HS 2012.
3.1. Paragraph
9 of the HS 2012 Decision mandates the Secretariat to review the submissions
prepared by Members. This review will follow a factual report[4]
which will include observations on the application of the transposition
procedure/methodology. This report will
first be submitted to the Members concerned for comments with a view to
reaching a common understanding. Any
outstanding issue that cannot be resolved will be attached to the "Draft
HS 2012 file" and will be circulated for multilateral review.
3.2. As
provided in paragraph 3 of the HS 2012 Decision, the Secretariat's work shall
be based on each Member's latest schedule, as reflected in the CTS. If tariff lines affected by changes in the
HS 2012 nomenclature have not yet been certified in the HS 2007 nomenclature,
then the "draft HS 2007 files", which have been approved by all other
Members in the multilateral review of the HS 2007 transposition, shall be used
as the basis for those tariff lines.
3.3. The
methodology employed by the Secretariat is based on the guiding principle for
the transpositions according to which the overall product coverage will not be
altered by any HS amendments. Products
removed from one subheading have to be reallocated to another subheading(s). Therefore, no matter how the HS subheadings
are affected by the change in HS versions, each subheading in the new
nomenclature must be composed of one or more subheadings or parts of these
subheadings from the old nomenclature.
3.4. Based
on this principle and the experience gained in the previous two transposition
exercises, a uniform processing methodology has been developed. It includes some semi‑automatic
procedures in order to
standardize and simplify the transposition process. Like in the HS 2002 and HS 2007 transposition
exercises, the following three-step procedure will be used by the WTO
Secretariat:
(1) All
the HS 2012 subheadings that are related
to structural changes will be
identified. For each of these HS 2012 subheadings, all
corresponding HS 2007 subheadings and their related national tariff lines will be identified in the CTS
Concession table and allocated
to their respective HS 2012 subheadings. The
result of this step will be a table listing all HS 2012 subheadings and
the corresponding HS 2007 national
tariff lines that could potentially be
reallocated under these HS 2012 subheadings.
A pair of HS 2012 and HS 2007 subheadings should be the same as
that in the WCO standard correlation tables.
One pair may correspond to more than one national tariff line. And one national tariff line may correspond
to more than one pair of HS six-digit
correlations or HS 2012 subheadings. All
tariff lines corresponding to an HS 2012 subheading are called "candidate
lines" for this HS 2012 subheading.
(2) A computer program will evaluate
all candidate lines for each HS 2012 subheading to
determine whether they could be simplified by, for example, collapsing them in
a single subheading. Specifically, if
all candidate lines corresponding to an HS 2012 subheading have identical concessions (if they present the
same core parts of the concessions, e.g. bound duty, INRs, ODCs, SSG, etc.),
these candidate lines could be simplified by collapsing them into one HS 2012
line. As it is no longer necessary to
distinguish between those candidate lines with identical concessions, the
different "origins" of these candidate lines could be ignored to
simplify the outcome. The HS 2012
subheading code and description would become the new tariff line code and
description.[5]
(3) When the concessions of candidate lines do not
fit in any of the four cases listed in Section II above, these HS 2012
subheadings and candidate lines will be put aside for manual
transposition. These candidate lines
will then be examined on a case-by-case basis to determine whether they should
be retained for this HS 2012 subheading or should be removed from this HS 2012
subheading. Since one HS 2007 subheading
can be split into more than one HS 2012 subheading, a national tariff line under
this HS 2007 subheading could, in theory, be assigned to each corresponding HS
2012 subheading as a candidate line.
Depending on the product coverage of this national tariff line, it may be
retained or dropped
for a specific HS
2012 subheading, but it should appear under at least one HS 2012 subheading. For all candidate lines that are kept, tariff
line codes and descriptions may need to be re-defined accordingly based on the national product
descriptions. These new codes and
descriptions become part of the new CTS in HS 2012 and the pairs of tariff line
codes in HS 2007 and HS 2012 are recorded in the correlation table.
3.5. Although
a large number of lines could be automatically transposed through a computer
program, and this process will significantly reduce the workload and help focus
the resources on the manual work, it should be noted that the manual work
involved would still be extensive and will require a considerable
resources from the WTO Secretariat.
3.6. The
following chart illustrates how this process is applied for processing two HS changes of a mock schedule with four national
tariff lines. The first change related to
subheading 9109.10 is processed automatically since the
two national tariff lines have the same duties.
The second change on subheadings 2008.93 and 2008.99 involves different duties for
candidate lines. It has to be processed
manually to take into account the national descriptions and duty rates.
Figure 5: Example of transposition procedures
WCO
Correlation Table
|
|
Schedule
of concessions in HS 2007
|
|
|
HS 2012
|
HS 2007
|
|
TL Code in HS 2007
|
Description
|
Duty
|
9109.10
|
9109.11
|
|
9109.1100
|
National
Description A
|
50%
|
|
9109.19
|
|
9109.1900
|
National
Description B
|
50%
|
|
|
|
|
|
|
HS 2012
|
HS 2007
|
|
TL Code in HS 2007
|
Description
|
Duty
|
2008.93
|
ex2008.99
|
|
2008.99.10
|
National
Description C
|
10%
|
2008.99
|
ex2008.99
|
|
2008.99.90
|
National
Description D
|
20%
|
|
|
|
|
|
|
|
|
Step 1
Candidate lines for HS
2012 subheadings
|
|
New Schedule in HS 2012
|
HS 2012
|
HS 2012
|
HS 2007
|
HS 2007
|
Description
|
|
|
TL code in HS 2012
|
Description
|
|
9109.10
|
Standard Description 1
|
9109.11
|
9109.1100
|
National Description A
|
50%
|
Step 2
|
9109.10
|
Standard Description 1
|
50%
|
9109.10
|
Standard Description 1
|
9109.19
|
9109.1900
|
National Description B
|
50%
|
Collapsed
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2008.93*
|
Standard Description 2
|
2008.93
|
2008.9910
|
National Description C
|
10%
|
|
|
|
|
2008.93
|
Standard Description 2
|
2008.93
|
2008.9990
|
National Description D
|
20%
|
Step 3
|
2008.9300
|
Standard Description 2
|
20%
|
2008.99
|
Standard Description 3
|
2008.99
|
2008.9910
|
National Description C
|
10%
|
Manual
|
2008.9910
|
National Description C
|
10%
|
2008.99
|
Standard Description 3
|
2008.99
|
2008.9990
|
National Description D
|
20%
|
|
2008.9990
|
National Description D
|
20%
|
|
|
|
|
|
|
|
|
|
|
|
*
It is assumed that as a candidate, HS 2007
national tariff line 2008.9910 is not relevant to HS 2012 subheading
2008.93. Therefore, it was dropped for
2008.93, but retained for 2008.99.
4.1. The
general aim of the HS amendments is to better align the international
classification standard to the changing requirements of the international
trading system, keeping it simple, relevant, and comprehensible. This sometimes requires substantial
regroupings of parts of headings or subheadings to other or newly defined
subheadings. Reflecting such changes in
the WTO schedules of concessions is often difficult due to the large number of
"legal legacies" that need to be preserved in order to retain
unaltered the different concessions.
From the WTO perspective, one of the main reasons for transposing
Members' Schedules of concessions is to allow for a comparison of the bound
duties reflected in the Schedules of concessions vis-à-vis the applied duties
(i.e. to ensure that concessions are not being breached).
4.2. The
"HS 2007 transposition methodology[6]"
highlighted the need for simplification of a limited number of cases, based on
the experience gained in the HS 2002 transposition exercise. Indeed, the
Secretariat had previously dedicated a substantial amount of manual work on a
handful of subheadings with complex coding structure and very complicated
technical descriptions. While the "2002 methodology"[7]
was technically correct, a disproportionately large amount of resources were
required and had the disadvantage of resulting in a complicated nomenclature
structure that was very difficult to align to the nomenclature of the applied
tariff used by Members in practice. In addition, some of the theoretical
breakdowns might be virtually empty, with no traded products actually being
classified under them.
4.3. While
the previous transposition procedures have stressed the principle of not
affecting the scope of the concessions to the extent possible, they have also
acknowledged the practical importance of achieving some degree of
simplification in case of complex cases.
Several simplification methods were provided for in the earlier HS transpositions
procedures in respect of the bound duties[8],
and are described in paragraph 5 of Annex 2 of the HS 2012 decision.
For instance, when two tariff lines with different duties were combined, the duty corresponding
to the tariff line with majority trade, or the simple or trade weighted average
could be assigned
as a single duty to a new tariff line, which otherwise
would need to be split in two in correspondence with the two different duties.[9]
4.4. Although
the decision does not mention methodologies that could be used to deal with
other types of simplifications, similar practical steps could be taken to
simplify the transposition work when the same bound duty is involved.
5.1. In
light of the previous section and the lessons learned from the former
transposition exercises, the Secretariat proposes to maintain the practical
solutions that aim at keeping the structure of Members' Schedules of
concessions simple, while preserving their rights and obligations. The use of any of these methods, which have
already been formally approved by the Committee for the HS 2007 transposition,
will be duly flagged and noted in the transposition files for transparency.
5.2. The
HS 2002 transposition took into account all INRs (present and earlier) and the
reference to the legal instruments (present and first). When two HS subheadings were merged and the
tariff lines under them had different INRs or instruments, new breakouts were
created to embody the different INRs or instruments, even though all other
elements of the concessions, e.g. bound duties and ODCs, were exactly the same.
For example:
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
3808.50
|
3808.50
ex3808.91
ex3808.92
ex3808.93
ex3808.94
ex3808.99
|
The scope of subheading 3808.50 has been expanded to cover
the products listed in the new subheading Note 1 to Chapter 38. Amendments
made consequential to the Rotterdam Convention on the prior informed consent
procedure (PIC) for certain hazardous chemicals and pesticides in
international trade
|
HS2012
|
Product description
|
HS 2007
|
|
Duty
|
INR
|
3808.50
|
- Goods specified in
Subheading Note 1 to this Chapter
|
3808.5000
|
- Goods specified in
Subheading Note 1 to this Chapter
|
0
|
B
|
|
3808.91
|
-- Insecticides
|
|
|
|
3808.9110
|
--- Containing inorganic substances
|
0
|
A
|
|
3808.9190
|
--- Other
|
0
|
B
|
|
|
3808.92
|
-- Fungicides
|
|
|
|
|
3808.9210
|
--- Maneb; zineb; mancozeb
|
0
|
A
|
|
|
3808.9290
|
--- Other
|
0
|
B
|
|
|
3808.93
|
-- Herbicides, …
|
|
|
|
|
3808.9310
|
--- Plant-growth regulators
|
0
|
A,B
|
|
|
3808.9390
|
--- Other
|
0
|
B
|
|
|
3808.94
|
-- Disinfectants
|
|
|
|
|
3808.9410
|
--- Based on quatermay ammonium salts
|
0
|
|
|
|
3808.9490
|
--- Other
|
0
|
|
|
|
3808.9900
|
-- Other
|
0
|
A
|
5.3. Although
the duty for all tariff lines under HS2012 subheading 3805.50 is zero, several
breakouts would still have to be created just for purpose of differentiating
the products corresponding to different INRs.
Not only is it difficult to determine the appropriate descriptions for
those breakouts, because they relate to many chemical terminologies both at the
level of the national tariff lines and in the chapter notes, but they also
result in breakouts that have no relationship with the breakouts of Members'
applied tariff line structure.
5.4. Since
INRs are normally attached to a duty level, it could be reasonable to simplify
those entries of INRs that relate to the same duty, keeping just one
entry. The Secretariat has previously
adopted an approach that avoids the creation of new breakouts solely for
differentiating INRs (present and earlier) and legal instruments (present and
first) in the HS 2007 transposition. The
"candidates" with the same duty but different INRs were collapsed
into one tariff line. For Members
holding INRs for only part of the tariff line, an ex-out was added in front of
country codes. In the case of the above
subheading the tariff line would read as shown in Table 4 below.
Table
5: Example of different INRs
HS Code
|
Description
|
Bound Duty
|
Present INR Text
|
3808.5000
|
- Goods specified in
Subheading Note 1 to this Chapter
|
0
|
exA,
exB
|
5.5. Similarly,
the "candidate lines" with the same duty but different present or
earlier instruments will also be collapsed into one tariff line. Any document symbol related to this tariff
line, fully or partially, will be listed together in the instrument fields.
5.6. For
the tariff lines that were affected by HS 2012 changes, assuming data
availability and to the extent that this helps in resolving complex
correlations, the Secretariat will take into consideration the transpositions
that have been done by Members in their applied tariffs. This would be
particularly useful in the case of correlations where the WCO could not achieve
a consensus among the Contracting Parties to the HS[10]. If the Secretariat determines that a Member
took a simplified approach in the transposition of that Member's applied
tariffs, the Secretariat would try to adopt the same approach as long as it
would be in line with the guiding principles of the transposition. Similarly, for Members belonging to a customs
union or using the same nomenclature, the Secretariat will endeavour to treat
their transpositions in a similar manner.
However, tariff lines that have not been affected by HS 2012 changes
will not be aligned to the applied tariff by the Secretariat.
5.7. The
WCO correlation table circulated in document G/MA/W/105[11]
is the main basis for the Secretariat's work. A simplified correlation table
could reduce the manual work involved and will ensure consistency in the
treatment of files that the Secretariat will process. Based on an analysis of HS 2012 changes, the
Secretariat proposes the simplification of some correlations as discussed below
and flagged in the Annex. If a Member
intends to make use of the standard correlation table or take other approaches,
it would need to inform the Secretariat.
(a) Simplifying the changes of subheadings deleted due to low volume of
trade
The HS 2012 amendments
removed headings with annual World trade below a $100 million threshold and
subheadings with annual trade below $50 million, unless these need to be
maintained for other reasons, such as environmental or social concerns. In
order to ensure a correct classification of the products originally falling
under the deleted subheadings, the WCO provides a correlation to indicate where
these products are reallocated.
In implementing these changes in their applied
tariff, Members typically delete these headings and subheadings. The products originally classified under the
deleted subheadings will apply the duties of the new subheadings where they are
reallocated.
In the HS 2012 amendments,
over 60 HS 2007 subheadings have been removed because the trade volume was
below the above-mentioned threshold.
These subheadings are flagged in the correlation table included in the
Annex. For 18 subheadings in the HS 2012
transposition, the Secretariat proposes to apply the rate(s) previously applied
to the tariff line(s) with the majority of trade if the low-trade subheadings
(or parts thereof) can actually be considered to be of marginal importance thus
omitting the correlation for the low-trade subheadings[12],
unless the subheading that was deleted due to low trade appears in the
nomenclature of the applied tariff. It
should be noted that this approach is expressly provided for in the HS 2012
Decision[13].
In the example below,
the commitments on subheading 1102.10 in HS 2007 will be discarded.
Simplification a: Low volume of trade
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
1102.90
|
1102.10
1102.90
|
Deletion of subheading 1102.10 because of the low volume
of trade.
|
HS 2012
|
Product description
|
Duty
|
HS 2007
|
Product description
|
Duty
|
1102
|
Cereal flours other than of wheat or meslin.
|
|
1102
|
Cereal flours other than of wheat or meslin.
|
|
|
|
|
1102.1000
|
- Rye flour
|
10
|
1102.2000
|
- Maize (corn) flour
|
5
|
1102.2000
|
- Maize (corn) flour
|
5
|
1102.9000
|
- Other
|
0
|
1102.9000
|
- Other
|
0
|
However this is not
possible in the following case where both HS 2007 subheadings are deleted and
merged into a new Subheading in HS2012:
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
2528.00
|
2528.10
2528.90
|
Subheadings 2528.10 and 2528.90 have been deleted because
of the low volume of trade.
|
(b) Simplifying selected complex changes
Complex changes account for
most of the Secretariat's workload of the HS transposition. In order to precisely maintain minor
differences among newly created breakouts, complicated structures and arcane
descriptions have to be employed.
Although these are technically correct, they are not aligned to the
national tariff, which can cause problems in the use of these schedules in the
future. Research done by the Secretariat
suggests that it is possible to simplify some of these cases, by considering
the patterns of trade and the reason behind the HS change. Three such situations are described
below.
Simplification
1: In the HS 2012 amendments, the scope of 28.52
was expanded by inserting the expression "whether or not chemically
defined" to compounds of organic or inorganic mercury. This change was
introduced in response to the international convention for facilitating the monitoring and control of these products under the Rotterdam
Convention on the prior informed consent procedure (PIC) for certain hazardous
chemicals and pesticides in international trade. Non-chemically defined mercury compounds
originally classified under a dozen of HS 2007 subheadings were transferred to
the new HS 2012 subheading 2852.90[14];
eight of the HS 2007 subheadings end with "90" or "9"
meaning that they are residual subheadings of the heading. When the national HS 2007 subheadings are more
detailed than 6-digit, it is not a straightforward exercise to identify the
products that could contain non-chemically defined mercury compounds. This
newly created subheading groups all the compounds based on the sole content of
non-chemically defined mercury. Therefore, it might not be necessary to
overcomplicate this subheading with new breakouts according to the other
elements contained in these compounds and, hence, avoid the introduction of
complicated codes and product descriptions that will not exist in the national
tariff. In this particular case, it
would seem appropriate to keep only one line and omit the details.
The key question for the transposition would be
which duty should be recorded for this new tariff line in HS 2012. Since most Members did not have national
breakouts specifically for not chemically defined mercury compounds under those
12 HS 2007 subheadings, trade statistics are normally not available. In this case, the mode[15]
of the duties of all the HS 2007 tariff lines could be used to arrive at
the duty of the new subheading.
Candidate lines that are not bound are discarded from the calculation of
the mode[16].
HS 2012 subheading 2852.90 will be fully unbound only if all the candidate
lines are unbound.
Simplification b.1a: HS 2012 subheading 2852.90
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
2852.10
2852.90
|
2852.00
ex2830.90
ex2835.39
ex2842.10
ex2848.00
ex2849.90
ex2850.00
ex2934.99
ex3201.90
ex3501.90
ex3502.90
ex3504.00
ex3824.90
|
The scope of heading 28.52 has been expanded by inserting
the expression "whether or not chemically defined". Subsequently
heading 28.52 has been divided to cover, under the new subheading 2852.10,
chemically defined inorganic or organic compounds of mercury, excluding
amalgams (facilitating the monitoring and control of these products under the
Rotterdam Convention on the prior informed consent procedure (PIC) for
certain hazardous chemicals and pesticides in international trade) and, under
the new subheading 2852.90, other inorganic or organic compounds of mercury,
excluding amalgams. For the purposes of subheading 2852.10, the expression
"chemically defined" has been defined in Subheading Note 1 to
Chapter 28. Expansion of the scope of heading 28.52 entails the transfer of
non-chemically defined compounds of mercury to the new subheading 2852.90.
|
Out of the 110
Members' CTS files in HS 2007, none has a national tariff line under the
12 HS 2007 subheadings listed in the correlation table above with a product description relating to
"non-chemically defined compounds of mercury". Consequently, all
national tariff lines under the subheadings in HS 2007 will remain fully listed
in HS 2012 for 10 of these 12 subheadings[17].
Although the product scope is reduced from HS 2007 to HS 2012, these can be
seen as a special case of one-to-one relationship as shown in the example
below.
Simplification b.1b: HS 2007 subheadings linked to HS 2012 2852.90
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
2830.90
|
ex2830.90
|
Non-chemically defined compounds of mercury have been
transferred to new subheading 2852.90.
|
HS2012
|
|
Duty
|
INR
|
HS 2007
|
|
Duty
|
INR
|
2830
|
Sulphides; polysulphides,
whether or not chemically defined.
|
|
|
2830
|
Sulphides; polysulphides,
whether or not chemically defined.
|
|
|
2830.1000
|
- Sodium sulphide
|
0
|
2830.1000
|
- Sodium sulphide
|
0
|
|
2830.90
|
- Other
|
|
2830.90
|
- Other
|
|
|
2830.9010
|
-- Potassium sulphide
|
0
|
A
|
2830.9010
|
-- Potassium sulphide
|
0
|
A
|
2830.9020
|
-- Zinc sulphide
|
5
|
B
|
2830.9020
|
-- Zinc sulphide
|
5
|
B
|
2830.9030
|
-- Cadmium sulphide
|
0
|
A,B
|
2830.9030
|
-- Cadmium sulphide
|
0
|
A,B
|
2830.9090
|
-- Other
|
3
|
A
|
2830.9090
|
-- Other
|
3
|
A
|
Simplification
2:
The scope of HS 2007 subheading 3002.10 (Antisera and other
blood fractions and modified immunological products, whether or not obtained by
means of biotechnological processes) was expanded to cover
other immunological products which are directly involved in the regulation of
immunological processes.
Simplification b.2: HS 2012 subheading 3002.10
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
3002.10
|
ex2925.29
ex2933.29
ex2934.99
ex2937.90
ex3002.10
ex3002.20
ex3002.90
ex3907.20
|
The scope of subheading 3002.10 has been expanded to cover
other immunological products which are directly involved in the regulation of
immunological processes.
|
HS2012
|
Product description
|
HS 2007
|
Product description
|
3002
|
Human blood; animal blood prepared for therapeutic, prophylactic or
diagnostic uses; antisera, other blood fractions and immunological
products, whether or not modified or
obtained by means of biotechnological
processes; vaccines, toxins, cultures of micro-organisms (excluding yeasts) and similar products
|
3002
|
Human blood; animal blood prepared for
therapeutic, prophylactic or diagnostic uses; antisera and other blood fractions
and modified immunological products,
whether or not obtained by means of biotechnological processes; vaccines,
toxins, cultures of micro-organisms (excluding yeasts) and similar products.
|
300210
|
- Antisera, other blood fractions and immunological products, whether or not modified or obtained by means of
biotechnological processes
|
300210
|
- Antisera and other blood fractions
and modified immunological products,
whether or not obtained by means of biotechnological processes
|
300220
|
- Vaccines for human medicine
|
300220
|
- Vaccines for human medicine
|
300230
|
- Vaccines for veterinary medicine
|
300230
|
- Vaccines for veterinary medicine
|
300290
|
- Other
|
300290
|
- Other
|
Five of eight HS 2007 subheadings are residual subheadings (ending with
90 or 9). Like in the previous case, it would seem appropriate to have only one
tariff line without a further breakout. The mode of the candidate lines would
be retained as the level of binding.
Simplification
3: Heading 96.19 was created for sanitary towels (pads) and
tampons, napkins and napkin.
Simplification b.3: HS 2012 subheading
9619.00
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
9619.00
|
ex392620, ex392690
481840
560110
ex610821, ex610822, ex610829
ex611120, ex611130, ex611190
ex611300
ex620891, ex620892, ex620899
ex620920, ex620930, ex620990,
ex621050,
ex630790
|
Creation of new heading 96.19 for sanitary towels (pads)
and tampons, napkins and napkin liners for babies and similar articles, of
any material
|
Subheading 9619.00
originates from 19 HS 2007 subheadings and was previously classified according
to their constituent material[18].
HS 2007 subheadings 4818.40 and 5601.10 should be fully retained as these
subheadings are entirely merged in the newly created heading. Regarding the
remaining 17 subheadings, it is proposed to retain the mode so as not to
unnecessarily overcomplicate the nomenclature.
Simplification b.3: HS 2012 subheading 9619.00, transposition to HS
2012
HS2012
|
Product description
|
Duty
|
INR
|
HS
2007
|
Duty
|
INR
|
9619.00
|
|
|
|
|
|
|
9619.001
|
- Of paper pulp, paper, cellulose wadding or webs of
cellulose fibre
|
|
|
4818.40
|
|
|
9619.0011
|
-- description of HS 2007 4848.4010
|
0
|
A
|
4818.4010
|
0
|
A
|
9619.0019
|
--
Other
|
5
|
B
|
4818.4090
|
5
|
B
|
9619.002
|
-
Of textile wadding
|
|
|
5601.10
|
|
|
9619.0021
|
--
description of HS 2007 5601.1010
|
5
|
A
|
5601.1010
|
5
|
A
|
9619.0029
|
-- Other
|
0
|
|
5601.1090
|
0
|
|
9619.0090
|
- Other
|
0
|
exA, exB
|
3926.2000 3926.9000
6108.2100 6108.2200 6108.2900
6111.2000 6111.3000 6111.9000
6113.0000
6208.9100 6208.9200 6208.9900
6209.2000
6209.3000 6209.9000 6210.5000 6307.9000
|
0
0
0
0
0
0
0
5
0
0
5
0
0
3
0
2
0
|
B
A
|
Other
issues related to the Secretariat’s transposition
5.8. HS
Contracting Parties were not able to reach consensus for one HS 2012 amendment.
Assuming data availability, the Secretariat will take into consideration the
transpositions which have been done by Members in their applied tariffs. In
case this information is not available or, if it does not help in resolving the
issue, the Secretariat will adopt a uniform approach by applying the
correlation provided by the WCO.
2012 version
|
2007 version
|
Remarks in WCO's
concordance table
|
4101.20
4101.90
|
ex4101.20
ex4101.20
4101.90
|
The transfer results from the amendment of subheading
4101.20.
* *No consensus for these correlations.
|
HS2012
|
Product
description
|
HS 2007
|
Product description
|
4101
|
Raw hides and skins of bovine (including buffalo) or
equine animals (fresh, or salted, dried, limed, pickled or otherwise
preserved, but not tanned, parchment-dressed or further prepared), whether or
not dehaired or split.
|
4101
|
Raw
hides and skins of bovine (including buffalo) or equine animals (fresh, or
salted, dried, limed, pickled or otherwise preserved, but not tanned,
parchment-dressed or further prepared), whether or not dehaired or split.
|
410120
|
-Whole hides and skins, unsplit,
of a weight per skin not exceeding 8 kg when simply dried, 10 kg when
dry-salted, or 16 kg when fresh, wet-salted or otherwise preserved
|
410120
|
-
Whole hides and skins, of a weight per skin not exceeding 8 kg when
simply dried, 10 kg when dry-salted, or 16 kg when fresh, wet-salted or
otherwise preserved
|
410150
|
-Whole hides and skins, of a weight exceeding 16 kg
|
410150
|
-
Whole hides and skins, of a weight exceeding 16 kg
|
410190
|
- Other, including butts, bends and bellies
|
410190
|
-
Other, including butts, bends and bellies
|
5.9. The
length of HS codes (six or more digits) used in the current CTS database will
be maintained for this transposition exercise. For those tariff lines where the
transposition was done automatically, the resulting tariff line codes could
have fewer digits than unaffected CTS lines.
In order to maintain a uniform tariff line coding, the HS codes of automatically
transposed tariff lines will be padded with trailing zeros in order to yield
the same code length as that of the tariff lines in the current schedule.
5.10. Like
in the previous transposition exercise, the classification of Agricultural (AG)
and non‑Agricultural (non-AG) products will follow the distinction proposed by
the Chairman of the NAMA negotiations in his latest draft modalities text[19]. This definition, which was presented in the
HS 2002 nomenclature, will be transposed to HS 2007, and then to HS 2012 by
applying the standard WCO correlation tables.
5.11. There
are two cases where the HS 2007 transposition resulted in a mix of AG and
non-AG products at the level of subheadings.
These were: non-AG HS 2002
subheading 0509.00 (natural sponges of animal origin) was deleted because of
its low volume of trade. This resulted
in a transfer to a formerly AG only subheading 0511.99 (other products of
animal origin) in HS 2007, which was the residual subheading of Chapter
05. The second case was the creation of
a new heading 28.52 for separate inorganic or organic compounds of mercury that
resulted in mercury compounds originally classified under 29 HS 2002
subheadings being transferred to this new HS 2007 subheading. Among the 29 HS 2002 subheadings
involved, two of them (ex3502.90 and ex3504.00) were defined as agricultural
products. HS 2007 subheading 0511.99 was treated as an agricultural product,
while 2852.00 was classified as a non-agricultural product.
5.12. There
is one case where the HS 2012 transposition results in a mix of Ag and non-Ag
products at the subheading level. HS 2012 subheading 2852.90 (non-chemically
defined organic or inorganic compounds of mercury, excluding amalgams)
originates from 12 HS 2007 subheadings, three of which are AG subheadings
(ex3501.90, ex3502.90 and ex3504.00). In the absence of a new definition in HS
2012, the Secretariat would propose to treat HS 2012 subheading 2852.90 as
a non-agricultural product considering that the agricultural component consist
only of a minor part of the new subheadings, both in terms of importance of
classification and volume of trade.
6.1. This section provides
further technical information on the format and contents of the HS 2012
transposition files to be prepared by the Secretariat. It should also serve as
a guideline to the format of the files that will be prepared by those Members
that will submit their own transpositions.
The format of the two key tables as well as reference information on WCO
HS 2012 nomenclature and correlation tables was already made available to
Members through the IDB File Exchange Facility[20]. The information is reproduced
in Tables 6 and 7 below, together with some additional explanations.
6.2. The changes that result from
the HS transposition are summarized in Tables 6 and 7. Table 6, called transposition file,
contains all relevant elements of the schedule for all those HS headings where
one or more tariff lines are affected by HS changes. Table 7, usually called the concordance or
correlation table, provides the concordance of all tariff lines in the
transposition file to one or more tariff lines in the schedule in the HS 2007
nomenclature. In its MS Access version,
a query called "Concordance_HS2007_HS2012" is available in each file
in order to extract the reverse concordance from HS 2007 to HS 2012. In MS
Excel, an additional worksheet with the reverse concordance is provided. The electronic files maintained in the
Consolidated Tariff Schedules (CTS) database in HS 2007 serve as the source of
information for Members' commitments.
6.3. Additional tables
transposing relevant concessions and commitments contained in other parts and
sections of the Schedules should also be included as part of the draft HS 2012
files in case relevant HS codes are affected. For example, if tariff
quotas or export subsidies are affected by HS 2012 changes, the Secretariat
will prepare an Excel file which would include (1) the tariff lines affected by
the HS 2012 changes and (2) the corresponding correlation table(s). The tables
maintained in the Consolidated Tariff Schedules (CTS) database will be used by
the Secretariat as the source of this information. The new tables will allow Members to
determine the precise scope of each concession or commitment in the new version
of the nomenclature. To facilitate the review process, an indication of
which tariff lines are affected by the HS 2012 changes within each tariff quota
or export subsidy will be included. The
information described in this paragraph should also be provided in the draft HS
2012 files prepared by Members.
6.4. The scope of the tariff
lines to be covered by this transposition exercise is given in the Annex of
this document. Tariff lines are defined
as all product items which can be identified by a product description and
corresponding commitments. This also includes tariff lines that are not
identified by a unique HS product code.
In the format of the Secretariat tables, these tariff lines are
identified by different tariff line suffixes.
All tariff lines in the HS 2012 transposition table need to be linked
via the concordance table with the HS 2007 version of the final concession
table in the Consolidated Tariff Schedules database.
6.5. For the sake of transparency
and facilitate the review process, it is also recommended to include the
unbound parts of HS 2012 subheadings affected by the transposition in the
correlation table and in the transposition file. This is necessary for those cases where
product descriptions can only be understood in the context of a full listing of
all product items within one subheading.
For example, the product description "Other" can only be
interpreted correctly if one knows all the items that are not covered by this
residual category. Leaving out unbound
items at the tariff line level, i.e. more detailed than HS subheadings, could
result in the misinterpretation of product description of bound tariff lines.
6.6. The Secretariat introduced
in the HS 2002 and HS 2007 transpositions all unbound tariff lines in the new
final concession table (listing the full nomenclature), as well as in the
transposition file and the correlation tables (in the HS2007
transposition). These files have been
made available for the multilateral review exercises. The final concession
table will be the basis for the HS 2007 version of the CTS, which is currently
under preparation. For the HS 2012
transposition exercise the Secretariat will prepare (1) a correlation table,
including correlations for unbound tariff lines, (2) a transposition file and
(3) a new final HS 2012 concession table covering the full nomenclature. However, in the document prepared for the
purpose of certification the unbound tariff lines will not be shown.
Table 6: Transposition file
FIELD NAME
|
DESCRIPTION
|
Member
|
Country code of the WTO Member
(ISO Alpha Code).
|
TL
|
Tariff line number, headings
or sub-headings.
|
TLLevel
|
Tariff line product level.
|
TLS
|
Tariff Line Suffix.
|
Ex
|
Ex recording concession on
part of the product or Ex1, Ex2, etc. recording concessions at different duty
levels.
|
Sector
|
Ag: Standard definition of agriculture used by
the Secretariat ; Ag-ex: Headers that
include both agricultural and non-agricultural products; Null:
Non-agricultural products.
|
Description
|
Product's description in
English, French or Spanish with dashes essential.
|
Certified
|
C: Certified, A: Approved but not yet certified; or
Null: Not certified.
|
Base Duty AV
|
Ad valorem duty only,
examples: 30 for (30%) or 11.75 for
(11.75%).
|
Base Duty Other
|
Specific duty or duty
containing a specific rate element (currency and quantity unit included) –
see examples under Base Duty Nature field below.
|
Base Duty Binding Status
|
B: Bound;
U: Unbound.
|
Base Duty Nature
|
A: ad valorem=10%; M: mixed=10% or $2/kg whichever is the
higher (/lower); C: compound=10% + S2/kg; S:
specific=$2/kg; O: other
textual duty.
|
Bound Duty AV
|
Ad valorem duty only,
examples: 30 for (30%) or 11.75 for
(11.75%).
|
Bound Duty Other
|
Specific duty or duty
containing a specific rate element (currency and quantity unit included) –
see examples under Bound Duty Nature field below.
|
Bound Duty Binding Status
|
B: Bound;
U: Unbound.
|
Bound Duty Nature
|
A: ad valorem=10%; M: mixed=10% or $2/kg whichever is the
higher (/lower); C: compound=10% + S2/kg; S:
specific=$2/kg; O: other
textual duty.
|
ODC Duty AV
|
Other duties and charges (ODC)
ad valorem duty.
|
ODC Duty Other
|
Specific duty or duty
containing a specific rate element (currency and quantity unit included) –
see examples under ODC Duty Nature field below.
|
ODC Textual Information
|
Textual information related to
ODCs.
|
ODC Duty Nature
|
A: ad valorem=10%; M: mixed=10% or $2/kg whichever is the
higher (/lower); C: compound=10% + S2/kg; S:
specific=$2/kg; O: other
textual duty.
|
Special Safeguard
|
SSG (English); SGS (French); and SGE (Spanish)
|
Present Instrument
|
Legal instrument on the
present concession, e.g. UR/94 for the Uruguay Round
|
Present INR Text
|
Initial negotiating rights on
the present concession (2 or 3 alpha ISO or other codes, separated by a
hyphen).
|
First Instrument
|
Legal instrument establishing
the first concession, e.g. G/47, etc.
|
Earlier INR Text
|
Initial negotiating rights on
earlier concession(s) and, if available, the duty level and reference on
historic INRs. E.g. CH 10 T/51-EEC6
20-US (2 or 3 alpha ISO or other codes, separated by a hyphen or comma).
|
Implementation From
|
Implementation period: Start year.
|
Implementation To
|
Implementation period: End year.
|
Table 7: Concordance table
FIELD NAME
|
DESCRIPTION
|
Reporter
|
Country code of the WTO Member
(ISO Alpha Code).
|
Ex_HS12
|
'Ex' signifies that only part
of the HS code (TL_HS12) is covered by this correlation.
|
TL_HS12
|
Tariff line number in HS2012
|
TLS_HS12
|
Tariff Line Suffix in HS2012
|
Rate_HS12
|
Ad valorem bound duty rate of tariff lines in the
HS2012
|
OtherRate_HS12
|
Other bound duty rate of
tariff lines in the HS2012
|
Ex_HS07
|
'Ex' signifies that only part
of the HS code (TL_HS07) is covered by this correlation.
|
TL_HS07
|
Tariff line number in HS2007
|
TLS_HS07
|
Tariff Line Suffix in HS2007
|
Rate_HS07
|
Ad valorem bound duty rate of tariff lines in HS2007
|
OtherRate_HS07
|
Other bound duty rate of
tariff lines in HS2007
|
7.1. Paragraph
9 of the HS 2012 Decision mandates the Secretariat to review the draft HS 2012
files prepared by Members before releasing them for multilateral review. In this respect, the Secretariat will prepare
a verification report which will be released together with the draft HS 2012
file prepared by the Member. To this
end, the Secretariat will follow a standard procedure that can be applied
objectively and transparently to all submissions. It can be summarized as follows:
7.2. Submissions
received in formats that differ from the suggested standard format in the
reference information[21]
will be processed in the standard format and converted to a database. The
Secretariat will apply the concordance table submitted to extract data from the
CTS (HS 2007) and list the commitments against the transposition file. In this
process, the issues identified by the Secretariat will be documented in a
report that will be sent to the Member concerned with a description of the
problems and suggestions for correction.
7.3. Consistency
checks will be performed to verify the correctness and completeness of the
submission itself, as well as in relation to the original HS 2007 schedule, as
reflected in the CTS. The following five
aspects will be verified:
(a) As the concordance table for
Members preparing their own file will not include duties, no verification of
duties will be made in this table. If
members provide this information, it will not be used by the Secretariat to
prepare the standard draft HS 2012 transposition file. The Secretariat will generate the HS 2007
duties from the CTS file and the HS 2012 duties from the Member's submission;
(b) All HS 2012 tariff line
codes in the correlation table should match with tariff
line codes in the draft HS 2012 schedule of the submission. Any mismatches will
be identified and noted;
(c) All HS 2007 tariff line codes
in the correlation table should match with tariff line codes in HS 2007
CTS files. Any mismatches will be identified and noted;
(d) If the draft HS 2012 file of a submission
includes a complete nomenclature, then the tariff lines that are not affected
by the HS 2012 changes should be the same as they are in HS 2007. Any
mismatches will be identified and noted;
(e) All tariff lines codes listed in the HS 2012
submission should be in line with WCO standard 2012 version of the HS. Any
mismatches will be identified and noted.
7.4. The
WCO's correlation table indicates that "they are not to be regarded as
constituting classification decisions taken by that Committee; they constitute
a guide published by the Secretariat and whose sole purpose is to facilitate
implementation of the 2012 version of the Harmonized System. They do not have legal status." Therefore, it is possible that WTO Members
deviate in one way or another from that correlation table in the transposition
of their schedule of concessions.
However, since the WCO correlation is the only common basis for the
transposition and will be used by the Secretariat to transpose the schedules of
developing country Members, it seems appropriate to compare the other Members'
submissions with the WCO standard correlation table and to identify any deviations.
7.5. Given
the large workload that this could entail and the limited resources available,
the Secretariat will not be in a position to analyse these submissions on a
line-by-line basis. The Secretariat
intends to use a standard procedure to exclusively identify the deviations that
resulted in an omission of duties that are lower than the duty proposed in
draft HS 2012 files, or which resulted in extra duties that are higher than the
duties resulting from the transposition following the WCO correlation table.
7.6. The
procedure will, firstly, conduct a theoretical transposition by applying the
WCO correlation to the HS 2007 CTS database of the Member concerned. As described in the first step of the general
methodology in Section II above, this will create a table that lists all HS
2012 subheadings, corresponding HS 2007 subheading and all national tariff
lines under each HS 2007 subheading, which could potentially be reallocated
under corresponding HS 2012 subheadings.
Secondly, both the theoretical transposition and the submission will be
grouped by HS six-digit codes and bound duties.
The results are two lists of unique duties for each HS six-digit
subheading. Then a comparison will be
done between the two lists to see if the unique duties under each subheading
can be matched. The comparison has three
possible results:
(a) Under the same HS 2012
subheading, the duties of the submission are exactly the same as the duties of
the theoretical transposition. For
example, under a subheading, the theoretical transposition has duties of 10 per
cent and 20 per cent and the submission for the same subheading has duties 10
per cent and 20 per cent as well. In
this case, although the national correlation could deviate from the WCO's
correlation table, the Secretariat will do no further checking because the
levels of concessions are most likely the same as they were in HS 2007;
(b) Under the same HS 2012 subheading, the
submission has extra unique duties. If
the extra duties are lower than the lowest duties of the theoretical
transposition, they will not be noted by the Secretariat. For example, for a
particular HS 2012 subheading the theoretical transposition by the Secretariat shows 2 duties, 10 per cent and 20 per cent, but the
Member's submission shows three duties, 5 per cent, 10 per cent and 20 per
cent. In the alternative case where the
extra duties in the Member's submission are higher than the highest duties of
the theoretical transposition, the tariff lines under the subheading will be
listed in the verification report. For
instance, the extra duty is 25 per cent instead of 5 per cent.
(c) Under the same HS 2012
subheading, the submission by the Member misses some unique duties, which are
in the theoretical transposition by the Secretariat. The theoretical transposition links all
national tariff lines under the relevant HS 2007 subheadings (candidate lines)
to each HS 2012 subheading. In some
cases such as a HS 2007 subheading is split into several HS 2012 subheadings,
not all candidates should necessarily be kept in certain HS 2012
subheadings; a candidate line can be transferred to different HS 2012
subheadings and it should be deleted as a candidate for the current HS 2012
subheading as long as other national tariff lines under the same HS 2007
subheading are kept for this HS 2012 subheading[22]. To determine whether a candidate tariff line
should be kept or deleted requires checking the product description manually,
as the Secretariat does in manual transpositions. The proposed verification would take a
relatively simple approach: a missing
unique duty will not be identified as a problem as long as other tariff lines
under the same HS 2007 subheading are kept for this HS 2012 subheading. Based on this assumption, a further check
will be done to determine whether a whole HS 2007 subheading is missing for
this HS 2012 subheading. If it is the
case, these will be listed as problems since the missing duties must be the
result of a missing correlation. If it is not the case, then the theoretical transposition
includes all national tariff lines under this HS 2007 subheading and the
submission select only some of them; the missing duties are being reallocated
to other subheadings.
7.7. If
the submissions include other concession elements, such as INRs, they will also
be taken into account in the above-mentioned process. It should be stressed that this comparison by
the Secretariat is not meant to replace the manual checking by other Members
interested in specific products. The automatic procedure is based on a number
of assumptions which may not always correspond to the result of a more in-depth
analysis.
7.8. The
problems found by the Secretariat in applying this procedure will be presented
in an Excel verification report, which will include three parts corresponding
to the three steps: problems found in
processing, inconsistencies, and deviations related to changes of
concessions. For each problem
identified, the tariff line codes and an explanation will be provided for ease
of reference and review.