Why is Classification in the Aerospace Industry so Difficult?

Posted by Ashleigh Fyman
Blog originally posted on 13/08/2020 01:43 PM

Tradelane-Header classifying planes.pptx

What if I told you classifying an airplane was like classifying the parts of the human body. Don’t worry, you don’t have to be an anatomist to be able to classify an airplane, but the intricacies do draw some parallels. The human body is made up of organs, tissue, muscles, bones, tendons, etc., whereas an airplane is made up of panels, motors, computers, seats, bolts and screws, and thousands of other parts.

I’m no anatomist. I began my career at Tradewin as a Classification Consultant, where I spent 8 hours a day, 40 hours a week, 52 weeks a year doing nothing but Harmonized Tariff Schedule (HTS) classification… for six years. I loved it. During my classification years, I worked extensively as an import consultant for the aerospace industry, and it took every bit of those six years to become an “expert” (self-proclaimed) aerospace classifier. 

So what is it that makes classifying aerospace parts so difficult? Let’s explore a couple of factors that come into play:

1. 8803.30 – Parts of goods of heading 8801 or 8802 (for example, helicopters & airplanes)

Perfect! I found my classification right away – parts of airplanes are expressly listed. I’m importing a part that goes on an airplane, so parts of an airplane MUST be correct… right? In some cases, that is correct. However, in a vast number of other cases, that would be incorrect. This line of thinking has gotten many importers in a bit of trouble with Customs and caused them to buckle down on their classifications. Subheading 8803.30 is not a “go-to” for all aircraft parts.

Consider our human body example. Bones are “part of” the human body, so in our hypothetical HTS, you would be tempted to classify your imported bones as “parts of the body.” But, what if it turns out bones are specifically called out in a different chapter (say…there’s a calcium chapter)? Similarly, while it may be true that a pipe is a part of the aircraft in the sense that it’s installed on an airplane, since pipes are specifically named in each material chapter, it would be more appropriate to classify a pipe in the steel chapter.

2. You don’t know what you don’t know

It took years of experience to feel completely confident in understanding all the possible headings in which a part could be included. Sure, maybe you could get lucky and type a part description or keyword in CROSS to lead you in the right direction – however,  that strategy is dependent on there being an existing ruling for a similar part which is not a guarantee and is not a reliable classification methodology.

Familiarizing yourself with the intricacies of the Harmonized Tariff Schedule is truly the only way to confidently classify aerospace parts. There are section notes that exclude entire chapters of the tariff schedule; meaning, for someone to confidently classify a part in chapter 85, for example, they would have to rule out all of the 32 headings in chapter 90. Not to mention all the other chapter and section exclusions.

One could reasonably classify a multi-function display (MFD) in either headings 8531 or 9013 which provide “electric sound or visual signaling apparatus” and “other optical appliance and instruments,” respectively. Before asking what the difference between these headings is, you first have to know that both headings exist. Only then can you effectively compare the two, and avoid arriving at an incorrect classification because of unfamiliarity.

3. The complexity of the parts

Back to our anatomy example. You want to classify a bone in the calcium chapter, but first, you need to identify the type of bone. Is it a skull? Rib cage? Spine? Sternum? Once you’ve identified the type of bone, you may need to know several other details about it to classify it in the correct subheading, such as what other parts of the body it connects to, and how. As in our earlier pipe example, once you confirm the material composition, you may also need to know the pipe length, diameter, end type, if it has fittings, or what it’s conveying. Where is it used or is it part of a finished goods kit? All are viable pieces of information needed.

Many aerospace parts have multiple applications. An engineer orders a part without knowing the end use or final application. Unless the engineers themselves are also doing the classification work, you’ll likely need to work with someone else to obtain all required product composition and use information. Getting the very specific, intricate details needed for every part can be difficult.

As with any industry, aerospace classification is intertwined with its own set of unique challenges. It can be difficult at times, but certainly not impossible. Asking the right questions, gathering as much information as possible, and becoming as intimate with the Harmonized Tariff Schedule as possible will make the task of classifying aerospace parts much easier.

When in doubt, Tradewin is here to help

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Topics: HS Classification

Blog originally posted on 13/08/2020 01:43 PM

Ashleigh Fyman

Written by Ashleigh Fyman

Ashleigh is a U.S. Trade Advisory Consultant with over seven years of industry experience. In her current role, Ashleigh supports Tradewin’s audit services, leads prior disclosure and post-entry projects, and advises U.S. importers on proper country of origin marking, and anti-dumping and countervailing determinations for imported products. Prior to her current role, Ashleigh was promoted to Tradewin’s Manager of Classification Services after working as a Classification Consultant for five years. Ashleigh is detail-oriented with exceptional organizational skills and a passion for research. She holds a Bachelor of Business Administration with a concentration in Human Resource Management and has been a Licensed Customs Broker since 2015.