TradeLane

It’s that time of year where you get out the fall or winter jacket as the temperatures begin to drop. Well at least they do in Canada. There is almost nothing better than reaching into one of the pockets and finding a 10 or 20 dollar bill. The thoughts race through your mind as you gaze upon your new found treasure. Ahh found money.

Maybe I could buy something nice for someone….

Maybe I could place a bet on my favorite team….Or better still the underdog….

Maybe I could save it for a rainy day…Nah that’s just way too sensible.

Found money can turn up in the most unlikely places. The Canadian Customs Tariff has a whole chapter dedicated to found money, but most people never think to look there. Chapter 99 is titled “Special Classifications – Commercial”. What exactly does that mean? Housed in Chapter 99 are Harmonized System (H.S.) classifications that are tied to certain conditions; for the most part a specific end use. Goods imported into Canada that are normally dutiable may have an applicable Chapter 99 classification that would render them duty free provided they meet the criteria of the Chapter 99 classification.

Over the last two weeks, requests for training seminars and workshops have really accelerated.  It might be our charming speakers, the nice weather, or perhaps, unbeknownst to me of course, that they are serving sangria at lunch. Regardless of the reason I thought I would touch on some of the unsung benefits of HTS Classification training. 

If you are in compliance, at some point in your career you have asked an engineer for the type of screw in a machine. Maybe you asked what it was made out of, or the head type, and they looked at you quizzically and likely ignored your request. They may have given you the look that said… “Those regulatory people must be fun at parties...”  (We are, but only because the Tariff drives us to drink).  For those lucky people with apparel classification, we need to know the thread count… really we do.

Compliance manuals are excellent vehicles to help importers and exporters ensure that they are doing everything they can to operate in conformity with the various laws and regulations under which they operate. The trick, however, is in deciding what actually needs to go into the manual.

A good jumping off point is to take a realistic look at the way your enterprise operates, and then ascertain what kinds of risk your various activities present to a regulator.

Binding rulings allow an importer to get a determination on the correct classification and duty rate for their products in advance of importation.  A binding ruling request can be submitted electronically or in a letter to the CBP Information Exchange, National Commodity Specialist with a detailed description of the product along with relevant specifications, descriptive literature and samples. The importer generally receives a response within 30 days. Once Customs issues the ruling, the classification is binding for all US ports.  

When was the last time your company did an in-depth review of the Harmonized Tariff Classifications assigned to the parts you import into the US? Go ahead and take a minute to think about it, I’ll wait…

I’m going to take a stab in the dark and say that you are guessing the last review was done sometime before the advent of the iPod, but after the Reagan Administration. Don’t worry, you’re not alone. I cannot tell you how many companies I deal with that find themselves in the same position. Unfortunately for them, more often than not they are only brought to ask this question of themselves because CBP has asked it of them in the form of an audit. If you take one thing away from this blog, DO NOT wait until CBP has asked you this question.