As businesses brace for 2025, the European Union will introduce significant updates to the Harmonized System (HS) of tariff classification, effective 1 January 2025. These changes, encapsulated in the Combined Nomenclature (CN), are vital for companies engaged in international trade to ensure accurate classification and compliance. The upcoming revisions reflect advancements in statistical requirements, commercial policies, and technological developments.

Key Updates

The 2025 HS classification update incorporates several critical changes to enhance the monitoring of specific goods, simplify classifications, and improve import control. Key updates include:

1. Introduction of new subheadings:

• Sharks and Shark Fins (Chapter 3)
• Tomatoes (Chapter 7)
• Biofuels (Chapter 27)
• Liquid Urea (Chapter 31)
• Wood Waste and Laminate Floor Covering (Chapter 44)
• Steel Laminations and Stator and Rotor Cores (Chapter 85)

These additions will facilitate more precise tracking and statistical analysis of these products.

2. Simplification of chapter 85:

• Reflecting the implementation of the Declaration on the Expansion of Trade in Information Technology Products (ITA) agreement, Chapter 85 has been simplified to streamline classifications related to technology products.

3. New subheadings based on the World Customs Organization (WCO) recommendations:

• In line with recommendations from the WCO, new subheadings are introduced in Chapters 27 and 29 to reflect current trade and regulatory environments better.

Impacted Industries

The 2025 HS classification update will significantly affect various industries. Companies in the following sectors should prioritize reviewing their classification databases:

1. Energy & Environment:

• Biofuel producers and companies dealing with wood waste must conform to the new classifications to facilitate trade and compliance.

2. Chemicals & Fertilizers:

• Businesses involved with liquid urea and other chemical products will be subject to the revised classifications.

3. Electronics & Technology:

• Companies involved in the production or trade of technology products, especially those related to the ITA agreement, must adapt to the simplified Chapter 85.

4. Construction Materials:

• Firms dealing with laminate floor coverings and other related materials must update their classifications per the new subheadings.

5. Steel & Manufacturing:

• Introducing classifications for steel laminations and stator and rotor cores will impact this sector.

Why Review Your Classification Database?

Accurate HS classification is not just a legal requirement but a strategic advantage. More than incorrect classification can lead to significant penalties, delays, and increased scrutiny from regulatory authorities. Reviewing and updating your classification database ensures:

• Regulatory Compliance: Avoid penalties and legal issues by following the latest trade regulations.
• Operational Efficiency: Streamlined customs procedures and faster clearance times.
• Cost Savings: Prevent overpayment of duties and unexpected costs due to misclassification.
• Reputation Management: Maintain your business’s reputation by demonstrating compliance and regulatory awareness.

Don’t Wait! Stay Ahead!

In the dynamic world of international trade, anticipating and adapting to regulatory changes is crucial. The 2025 updates to the EU HS classification present both challenges and opportunities. By proactively updating your classification database, you can ensure compliance, optimize operations, and protect your business interests.

How We Can Help

At Tradewin, we are experts in navigating the complexities of international trade regulations. Our team is ready to assist you in preparing for the 2025 HS classification updates. Our services include:

• Comprehensive Audit: Thoroughly review your current classifications to identify and rectify discrepancies.
• Customized Strategy Development: Tailored plans to ensure full compliance with the new standards.
• Training & Support: Training sessions will help your team understand and implement the changes effectively.
• Ongoing Compliance Monitoring: Regular updates and monitoring to keep you compliant with evolving regulations.

By recognizing and preparing for these changes, you position your business for success. Reach out to Tradewin today to find out more.