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5422.0 - International Merchandise Trade, Australia, Dec 2000  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 20/02/2001   
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Feature Article - Revision to the Harmonised System (2002)


INTRODUCTION

Changes to the international Harmonized Commodity Description and Coding System (the Harmonized System or HS) will be introduced on 1 January 2002. 1 January 2002. The Harmonized System is the 6-digit classification upon which the Combined Australian Customs Tariff and Statistical Nomenclature (the Customs Tariff - the 8-digit and 10-digit import codes) and the Australian Harmonized Export Commodity Classification (AHECC - the 8-digit
export codes) are based.

The HS is a broad classification system of approximately 5,000 6-digit headings which are used for classifying goods involved in international trade. First introduced on 1 January 1988, it has subsequently been adopted as the basis for describing and classifying goods for Customs purposes by most trading nations, including Australia. It provides international comparability of trade information for administrative and statistical purposes.

The international changes will necessarily impact on the more detailed commodity classifications used by the Australian Customs Service (Customs) and the ABS to capture and disseminate data on goods traded by Australia. The changes will affect individuals and organisations involved in importing or exporting goods or using ABS trade statistics. The purpose of this article is to provide information about the processes and timetable that will be followed, to enable implementation on 1 January 2002.


THE HARMONIZED SYSTEM

The HS is maintained by the World Customs Organization (WCO) and is subject to systematic review to ensure it:

  • reflects newly developed commodities and changes in the types of commodities traded;
  • meets administrative requirements, for example, for the General Agreement on Tariffs and Trade, or to clarify the existing nomenclature; and
  • minimises the burden on data providers by requesting only the level of detail that is administratively and statistically relevant.

While the HS is reviewed by the WCO on a systematic basis, major changes are implemented only every four years or so. The last round of major changes to the HS was implemented on 1 January 1996, affecting approximately 10% of the 6-digit codes in the HS. Implementation of the current set of changes will affect segments of the Explanatory Notes and 5% of the 6-digit HS codes.

The HS changes include: deletion of a code completely; placement elsewhere in the classification (eg. with more-related commodities); combining of codes; splitting of one code into two or more; and changes in the Explanatory Notes on how commodities are
to be treated.


AUSTRALIAN CLASSIFICATIONS

Changes at the 6-digit HS level will necessarily have implications for the more detailed 8- and 10-digit import codes and 8-digit export codes. These codes will be changed to reflect the different HS treatment, including: Customs decisions to collapse or sub-divide HS codes to manage application of duty rates; statistical requirements of analysts for different information; and changes to the unit of quantity for reporting purposes.

While the most detailed statistics on Australia's international trade are made available according to the statistical codes of the Customs Tariff and AHECC, statistics are also available compiled using more aggregated classifications. It is considered unlikely that the HS changes will have any significant impact on the presentation of data according to these classifications.


CONSULTATION PROCESS

The ABS is about to commence consultation on the changes to the HS and the import and export classifications with those involved in the importing and exporting of goods and use of detailed trade statistics. This phase is expected to be completed by June 2001.

During this period detailed proposals for changes to the classifications will be released progressively on the ABS website for comment. It is expected that exports consultation will start in March and run through to the end of April 2001. Consultation on imports is likely in the period April to June 2001.

Industry will be advised of the process through the issuing of an Australian Customs Notice (ACN). Current subscribers to ABS data services will receive a letter from the ABS. Every effort will be made to ensure that all those affected are aware of the proposed changes and have an opportunity to comment on those aspects of interest to them.

All submissions received by the ABS prior to the respective deadlines will be considered. Any submissions that request changes to areas of the classification which are not not affected by international HS changes will be charged for at the normal rate for Classification Feasibility Studies.

After consultation has been completed, details of the new classifications will be made available progressively on the ABS website so importers, exporters and their agents can update their systems. It is expected that these will be available by mid to late November 2001.

For further information about the proposed changes, readers can:
  • visit the ABS website and view the changes via the International Trade Theme Page (www.abs.gov.au see Themes, International Trade);
  • send in the order form appearing on the last page of this publication, to obtain detailed specifications of the proposed changes to the HS Sections when they
  • become available for consultation; or
  • write to, email or telephone:


HARMONIZED SYSTEM REVIEW, 2002 - ORDER FORM

Please open PDF file below to print the order form on page 3.


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