After the World Customs Organization announced the 7th edition of HSN – “HS-2022” with effect from 1st January 2022, the Federation of Freight Forwarders’ Associations in India (FFFAI) in a webinar contemplated the changes in the earlier version of the HS Code.
The Webinar was addressed by Mr Shankar Shinde, Chairman, FFFAI and Mr Krishna Barad, Partner – Customs & International Trade, Indirect Taxes – BDO India as Guest Speaker.
Mr Dushyant Mulani, Chairman-Elect, FFFAI; Vice Chairmen, FFFAI Mr S. Nataraja, Mr Kartik Pancholi and Mr Sudip Dey; Mr Vinod Sharma, Hony. Secretary, FFFAI; Mr S. Ramakrishna, Past Chairman and Advisor, FFFAI and other Members of the Federation, also spoke on the occasion.
The webinar witnessed the participation of all Office Bearers along with approximately 800 FFFAI members from across the country.
Highlighting the importance and critical aspects of the WCO HS Nomenclature, recognised internationally, Mr Shinde in his opening remark said, “HSN is the basic tool of international trade and we are legally bound to classify goods correctly. We need to very carefully understand the 7th edition of the HSN, many of them are linked with GST. It is our pleasure to organise this important webinar with an expert speaker, Mr Krishna Barad, to highlight and analyse the new HSN. FFFAI endeavours to enhance domain knowledge pertaining to CB/FF and end to end logistics business and this webinar is one of such ongoing initiatives.”
Further pointing our he says that since its creation in the 70s, the HS Code has become a universal economic language essential to the fluidity of international trade. The system is used by more than 200 countries and economies as a basis for their customs duties and for the collection of international trade statistics. More than 98% of goods in international trade are classified in terms of HS.
The FFFAI Chairman also appreciated the efforts taken by CBIC, Customs and GST department in sync with IT –DG System CBIC to update system to have smooth transition for timely clearance of shipments.
Stating the changes in HSN as the biggest happening in the new year 2022 for the Customs Broking business in particular, Mr Dushyant Mulani said it would affect the CB business to a greater extent. Accordingly, CBs should have clear understanding about the new changes in HSN to apply the same correctly avoiding hassles and penalty, etc.
In his speech Mr Barad focused on HSN Classification Changes, Case Laws & Illustrations and How to do product HS classification.
The new HS 2022 edition makes some major changes to the Harmonized System with a total of 351 sets of amendments at 6-digit level covering a wide range of goods moving across borders. The goods are divided into the following sectors: agriculture (77), chemical (58), wood (38), textile (21), base metal (27), machinery (57), transport (22) and other (56).
Adaption to current trade through the recognition of new product streams and addressing environmental and social issues of global concern are the major features of the HS 2022 amendments.
Major highlights of HS-2022 include:
- Visibility has been introduced to a number of high-profile product streams to recognise the changing trade patterns.
- Electrical and electronic waste, commonly referred to as e-waste (an example of a product class which presents significant policy concerns as well as a high value of trade): specific provisions included in HS-2022 for its classification to assist countries in their work under the Basel Convention.
- New provisions for novel tobacco and nicotine-based products resulted from the difficulties of the classification of these products, lack of visibility in trade statistics and the very high monetary value of this trade.
- Unmanned aerial vehicles (UAVs), commonly referred to as drones.
- Smartphones will gain their own subheading and Note, which will also clarify and confirm the current heading classification of these multifunctional devices.
- Major reconfigurations have been undertaken for the subheadings of heading 70.19 for glass fibres and articles thereof and for heading 84.62 for metal forming machinery.
- Health and safety have also been featured in the changes. The recognition of the dangers of delays in the deployment of tools for the rapid diagnosis of infectious diseases in outbreaks has led to changes to the provisions for such diagnostic kits to simplify classification.
- Goods specifically controlled under various Conventions have also been updated.