Harmonized Tariff Schedule Accountability

Issue 531, October 15, 2006

As most importers of record are aware, on December 8, 1993, The North American Free Trade Agreement Implementation Act, also known as the Customs Modernization or “Mod” Act, became effective. Accordingly, this landmark legislation imposed a greater obligation on the Importer of Record in regard to managing its own compliance destiny.

Under the Mod Act, the responsibility for classification of imported merchandise has been moved from Customs and Border Protection (CBP) to the responsibility of the Importer of Record. Formal classification of imported merchandise requires a thorough knowledge of the goods being imported.

CBP has posted to its website a copy of the 2006 Harmonized Tariff Schedule (HTS) for importers to review and classify such goods being imported. In order to access this website please visit www.cbp.gov. Click on Import (at the top of the page), click on Duty Rates (on the left hand column), under "On the Web" (on the far right) click on 2006 HTS (U.S. International Trade Commission) or 2006 HTS by Chapter.

In addition, as the importer of record, you have the right to obtain from CBP a written classification ruling for your imported goods. The ruling, which becomes binding on every CBP office in the United States, eliminates delay and confusion in the release and entry process of imported merchandise and verifies accurate duty and fee assessment.

Failure to exercise reasonable care and the improper classification of goods under the appropriate tariff classification could lead to:

• Incorrect duty assessment which could lead to overpayment of duties
• Additional duties and interest
• Fines and penalties
• Denial of a preferential program benefit which otherwise could be entered as duty free or at a reduced rate of duty

The assistance of a classification expert may be required in order to accurately classify your imported product. DHL Global Forwarding has a group of trained professionals to assist you with your classification needs and with obtaining binding rulings from Customs and Border Protection.

Should your organization require the assistance of one of our trained professionals please contact Mr. Paul Vroman paul.vroman@dh.com, Mr. Karl Krueger karl.krueger@dhl.com or Mr. Ron Reuben ron.reuben@dhl.com to discuss how DHL Global Forwarding can work with you regarding your importing needs.

DHL Global Forwarding values you as a client and we look forward to assisting you with your importing requirements.