Tariff nomenclatures are codes and denominations used by logistics professionals such as SpainSur Forwarders.
These are a source of doubt among many traders operating in international trade.
Today in our blog we want to show you which are the most common tariff nomenclatures, what digits they contain and why they are important.
What are tariff nomenclatures?
Tariff nomenclatures are a way of organizing goods and classifying them. These are a clear and visible description of the content and origin of the goods.
Based on this, the customs duties of the goods are set at customs clearance. It goes without saying that it is an application in international trade cases.
These designations, which could be likened to our passport or ID card, are essential to streamline and ensure a safe and efficient buying and selling process and international trade system.
Three binding tariff nomenclatures in Spain
Today, there are three binding classification systems to pay attention to, which are respected and shared by almost all countries in the world.
- Amortized System (AS).
- Combined Nomenclature (CN).
- TARIC coding.
But what do each of them bring to the table? And what do they mean? Let’s take a look at it.
The amortized system (SA)
The amortized system (AS) is the most widely used nomenclature in the world of international trade.
It arose as a need to unify the different coding methods that existed in different areas of the world. Needless to say, this was a major hindrance to the reliability of international trade and security when transporting goods between different areas of the world.
The World Customs Organization (WCO), seeing that there was no consensus on the choice of a system to everyone’s liking, set to work in the 1970s to create one.
Thereafter, 147 countries agreed to design it, and in 1988 the Amortized System came into force. It is constantly being updated; it is updated every 4 years.
This tariff nomenclature has 6 digits:
- The first two correspond to the chapters (1 to 97).
- The following two, to the games.
- The last two, the subheadings.
In addition, as annexes, a series of auxiliary texts were designed, which are very necessary for the correct application of the HS. This set of documents are the classification criteria, the product index, the database and the explanatory notes.
Combined Nomenclature (CN)
The tariff nomenclature is an international trade code specific to the European Union. It can be considered complementary to the HS, since it is composed of the HS plus two digits that are placed at the end, making a total of 8 numbers.
It is therefore the foundation of the EU codification method and is updated annually and its content is published in the Official Journal of the EU.
Its function is the application of the Common Customs Tariff. The purpose of this is to identify non-EU goods and fix the relevant customs duties on them. On the other hand, it is essential to make the Intrastat declaration between member countries.
As is the case with the HS, it contains a number of ancillary texts, such as explanatory notes, classification regulations and binding arancerelated information.
The Integrated Tariff of the European Communities (TARIC)
TARIC Coding is the last of the three standard tariff nomenclatures.
This was created to apply customs duties that differ to some extent with the EU Common Customs Tariff.
These include anti-dumping measures, border inspections, sanitary control, etc.
It is managed by the European Commission together with the member states, and one of its advantages is that it is constantly updated by its computer system.
It is composed of 10 digits: the 6 HS digits, the 2 NC digits and the last two digits are the company’s own digits. However, it is allowed to add up to 3 codes of 4 characters each to make the nomenclature more precise.
