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Both the Harmonized System (HS) and the Standard International Trade Classification (SITC) will change. The Australian Bureau of Statistics (ABS) will also change the way in which the Australian Harmonized Export Commodity Classification (AHECC) is published.
The ABS will release additional information papers as further work is undertaken on the classifications.
This information paper has the following contents:
User opportunity to review statistical code changes
Impact on statistical series
Electronic publication of the AHECC
THE HARMONIZED SYSTEM
The HS is a broad classification system of approximately 5,000 6-digit headings which are used to classify internationally traded goods as they enter or leave a country. It was developed and is maintained by the World Customs Organization (WCO). First introduced on 1 January 1988, it has been adopted by most trading nations, including Australia. It enables information on traded goods to be compared internationally.
Australia expands the international HS to produce two different classifications for imports and exports. These classifications are the Combined Australian Customs Tariff Nomenclature and Statistical Classification (referred to as the Customs Tariff) and the AHECC.
The extensions to the HS exist:
Australia's international merchandise trade statistics are derived from information provided by importers, exporters and their agents to Customs. Statistics are produced on Australia's imports and exports.
The HS is subject to ongoing review by the WCO to ensure it:
The HS is reviewed by the WCO on a systematic basis, but major changes are normally implemented only every five years. HS2007 is the third major revision of the HS since the System was adopted by the WCO and it is estimated to impact on more than 1,000 of the approximately 5,000 6-digit headings to the nomenclature.
Changes at the 6-digit level of the HS have implications for all Australian extensions of those 6-digit codes (i.e. 8- and 10-digit import codes and 8-digit export codes). HS codes scheduled for change could be affected by:
The ABS will prepare spreadsheets showing the proposed changes to the export and import classifications. These will be released on the ABS website in an information paper, Proposed changes on 1 January 2007 to statistical codes for the AHECC and the HS Tariff. This is planned for release in August 2006.
Users of trade statistics can request that existing statistical structures be split to provide greater detail on specific commodities. When such a request is made, the ABS conducts a Classification Feasibility Study to ensure the dissection meets certain criteria. These criteria include:
However, any requests received will be deferred until the new classification is implemented. Requests to change statistical codes will be charged for in the normal manner as outlined on the ABS website at: https://www.ausstats.abs.gov.au/Ausstats/subscriber.nsf/0/B2B2BA8878330025CA257110007E36D6/$File/5499055001_international%20trade%20cfs_1.pdf.
ABS initiated changes
The ABS approach for HS2007 is to maintain the existing statistical codes in the Customs Tariff and AHECC where possible. However, the ABS will not necessarily create a statistical code for each theoretical split. The ABS may consider closing up statistical codes where:
In addition, the ABS may close up statistical codes in extreme cases where misreporting at the statistical code level results in data quality problems. This is not generally done, unless repeated liaison with importers or exporters fails to rectify the data quality problems.
While the most detailed statistics on Australia's international merchandise trade are available according to the statistical codes of the Customs Tariff and the AHECC, statistics are also presented according to broader classifications. These include:
At the same time as the HS2007 review, changes are being made to the SITC. This is the main classification used for high level outputs of aggregate merchandise trade and trade in goods statistics. In the past, in order to maintain continuity in SITC series, the United Nations Statistics Division issued appropriate correlation tables between SITC and each new edition of HS. However, a strict period-to-period comparability was being lost for a growing number of series due to significant changes in the HS. An aim of the current review is to address these anomalies. More information about the SITC review can be found on the United Nations website at http://unstats.un.org/unsd/trade/sitcrev4.htm
It is unlikely that the HS and SITC changes will have any major impact on the international BEC or BoPBEC.
ANZSIC is used to present trade statistics on an industry of origin basis. These statistics are compiled by allocating statistical codes from the AHECC and Customs Tariff to an industry of origin based on the primary activities of the industry with which they are most commonly associated. The ANZSIC classification has been recently revised, however international trade data will not be presented according to the new ANZSIC until the July 2009 reference month.
USER OPPORTUNITY TO REVIEW STATISTICAL CODE CHANGES
As the ABS is intending to maintain the current statistical codes wherever possible, the ABS will generally not consult clients as part of this review. However, the ABS will appreciate feedback on any apparent errors in the statistical codes or concordances.
The ABS will progressively issue proposed changes to the 8-digit export statistical codes from August 2006 and then provide a limited period for interested parties to provide feedback. A similar process will be followed for the 10-digit import statistical codes, once Customs has released the 8-digit tariff items.
After the consultation period, the final new classifications will be made available progressively on the ABS website, so importers, exporters and their agents and statistical users can update their systems. It is expected that these will be available by mid to late November 2006.
IMPACT ON STATISTICAL SERIES
As occurred with the introduction of the previous update to the HS in 2002 and as occurs with subsequent changes to statistical codes in the AHECC and HS Tariff, no attempt will be made to maintain the time series of individual statistical codes i.e there will be a break in series between the HS2002 and HS2007. However, statistical codes unaffected by the introduction of HS2007 will be comparable before and after 1 January 2007 (about 15 chapters appear not to be changing with HS2007). Detailed concordances will be available to assist clients trying to follow the export or import of particular commodities over time. While it will not be explicitly ensured, it is more likely that the broader levels of the classification will be compatible over time
Subject to further investigation, ABS is unlikely to maintain time series of international merchandise trade data, on a recorded trade basis, before and after 1 January 2007. For trade data on a Balance of Payments basis, it is unlikely that the ABS will maintain the time series except for SITC at the two digit level and BoPBEC at the detailed (or 109 category) level. These plans will be confirmed in a future information paper.
ELECTRONIC PUBLICATION OF THE AHECC
In addition to being responsible for the statistical codes of the AHECC, the ABS produces the actual classification which is used by exporters and their agents and statistical users. When HS2002 was implemented in January 2002, the ABS released a hard copy of the AHECC (about 760 pages) to subscribers. Since then the ABS has issued replacement pages (usually twice a year) as a PDF.
With the January 2007 changes the ABS is planning to only release the AHECC in electronic format. The exact format is still being finalised but it is anticipated that a spreadsheet will be used with each item (e.g. 6 digit heading, 8 digit statistical code, UQ) presented in a different column. This format will facilitate electronic searching of the classification. The spreadsheet will be printable in a readable format but the presentation will not be as hard copy friendly as the current paper-based AHECC. Exporters, agents or statistical users requiring a hard copy of the AHECC will have to print their own copy.
The Australian Customs Service will continue to produce a hard copy version of the HS tariff.
Any comments on the proposed electronic release of the AHECC should be directed to the contact listed below.
It is proposed to release the following information papers during the year, with their tentative timing indicated:
HS2007 Review Team
Balance of Payments and International Trade Section
Australian Bureau of Statistics
PO Box 10
BELCONNEN ACT 2616
ph: 02 6252 5409
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