Beginning International Trade – Harmonized System


Interested in going global with your products?

You don’t necessarily need to be a huge company to do so.

This involves many steps, but the first one is determining what your number is for your product code using the international Harmonized System.

If you’re in the US, your Harmonized System number (also called HS number) consists of a total of 16 digits. This is a combination of the 6-digit HS number, and the 10-digit “Schedule B” numbers required by the US. The first six numbers classify traded products, and are used by customs around the world so they know what your duty fees and taxes will be. Additional numbers help governments to distinguish what’s what in terms of your product category.

A “Schedule B” number is what the US uses to classify exported products. This makes up the remaining 10 digits, which follow the Harmonized System code. The US also uses these numbers to monitor US exports.

The US Census Bureau uses the Schedule B information, as well as Shippers’ Export Declaration (SED) to figure U.S. export statistics. This information can also be used by the state you’re in, to figure how much exporting is going on. Often, once listed as an exporter, your state may offer various benefits to help you get going – such as supplementing some trade show expenses here and abroad, and listing you as an exporter within the state.

You’ll have to do a bit of research to determine your HS number and Schedule B number. Visit the U.S. Census Bureau’s web site to classify your products. Choose wisely and carefully, and spend some time studying this since you’ll have to live with it for some time. You do NOT want them to choose for you, as this can be limiting or not a precise fit for your products. The wrong classification can hold your products up in customs.

Here are some good resources:

Census Bureau’s web site  (also listed above)

U.S. International Trade Commission

This video can help you understand how to classify your product:

http://www.census.gov/foreign-trade/data/video022.html

 

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