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2007 WCO Changes to the HTS Imminent

1/21/07 6:00 PM | John Goodrich | Export Compliance
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For the past six months I have made you aware of the sweeping changes being made to the Harmonized Tariff System (HTS) and the uncertainty as to when those changes will be implemented. The International Trade Commission (ITC) has now announced that the final version of the 2007 HTS including the World Customs Organization (WCO) changes will become effective on February 3, 2007.

Guy_holding_question_marks_in_front_of_his_faceFor the past six months I have made you aware of the sweeping changes being made to the Harmonized Tariff System (HTS) and the uncertainty as to when those changes will be implemented. The International Trade Commission (ITC) has now announced that the final version of the 2007 HTS including the World Customs Organization (WCO) changes will become effective on February 3, 2007.

The International Trade Commission (ITC) has posted a draft version of the 2007 HTS at its website. Some of you may have discovered that this draft edition includes a dark red watermark that renders the document almost illegible.

The friendly folks at the ITC are committed to posting the final version no later than January 22, 2007, at the same link listed above. In the interim importers are to use the 2007 preliminary HTS also posted at the ITC link above.

U.S. Customs and Border Protection (CBP) has announced plans for implementing the updated tariff. Based on industry input, they are allowing a 17-day grace period ending on February 20, 2007, for importers to transition to the new numbers. Implementation plans are posted at their website. CBP warns the community that they will be lenient about classification discrepancies during this grace period but only insofar as the discrepancy relates to the underlying WCO changes.

Exporters are likely scratching their heads over the confusion. The Census Bureau published the export version of the tariff, the Schedule B, including all WCO changes on their website at the beginning of the year.

What is an importer supposed to do? Get moving! You have until February 3, 2007, to compare your old classifications to the new ones, update your HTS database and inform your Customs Broker of the changes.

While this may seem like an insurmountable task to accomplish, it is not as difficult as it first might appear. If you are like most importers, the changes will affect about 10% of your classifications. One importer advised me that of the 50 HTS classifications they regularly use, only one had changed.

What database, you ask? (Sigh) If you are asking that question, I can recommend a consultant who can assist your company with its compliance processes.