Customs

Meaning, significance of HS Code in import/ export of goods

The Eyewitness News Educational series

HS codes are product identification numbers used in international trade that are recognized by most countries.

The World Customs Organisation (WCO) manages the HS codes, which are widely used by businesses and customs officials to identify commodities.

Harmonized commodity description and coding system or HS is a term utilized for the classification of globally traded products by names and numbers.

In this article, we will discuss the HS Code and its significance in import and export.

Everything you need to know about HS Code

The World Customs Organization’s Harmonized Commodity Description and Coding System is known as the Harmonized System (HS) Classification.

It is an international system for classifying goods for customs purposes, giving each category of goods a special 6-digit HS code.

The Customs Cooperation Council first used the system in 1983. Although most nations in the globe have standardized their HS codes, there are notable exceptions.

The word “harmonized commodity description and coding system,” or “HS,” is known as the system of naming and numbering things that are traded internationally.

The average HS Code contains 6 digits. These six numbers are then categorized into three groups of two digits each.

The HS Code’s structure is considered to be this. The HS Code is written as follows: 420222.

A description of the imported or exported product is provided for every set of two digits.

The first 2 digits Include: the HS chapter (the type of commodity)
The second 2 digits Include: HS heading (raw material information)
Third 2 Digi Includes: HS subheading (finished or non-finished good)

Rules for Harmonised System and HS codes.

There are certain rules that govern and manage the Harmonised System and HS codes. These are:

1. General Rules for Harmonised System:

These make sure that a certain product is exclusively linked to one heading (and subsection) and none else.

There are six general rules of interpretation (GRI), and they are arranged in ascending order, starting with GRI 1 and continuing through GRI 6 and 7.

GRI 1 states that “classification is considered by the terms of the headings and of the section or chapter notes”.

If a classification cannot be thus determined, then GRI 2 to GRI 5 is applied.

GRI 2 has two parts. GRI 2 (a) extends the scope of a heading to cover not just completed products but also “incomplete”, “unfinished”, “unassembled” or “disassembled” products, provided they have the “essential character” of the finished product.

GRI 3 lays down the rules for classifying goods that fall under more than one heading.

GRI 4 applies to goods not specifically covered by any heading (perhaps because they are newly introduced).

GRI 5 applies to the classification of boxes, containers, and cases in which commodities are packed (cases for cameras, guns, jewelry, etc.).

The classification of any packaging that is not covered under GRI 5 is left to the discretion of countries.

GRI 6 contains a classification of goods in the sub-headings.

Importance of HS Code in the Import and Export of goods.

The HS harmonized system code is essential because it interprets the product’s information and enables both parties to avoid unintentional catalog-based confusion during the exchange.

The further components that heavily required HS Codes are as follows:

HS Code for Import and Export
The most crucial action for shippers to do before arriving at the import and export markets is to assign an HS Code.

The importance of the HS code could be considered by importers and exporters.

Most frequently, providers just acquire purchase orders from importers and send their products without having Export Import Data of an item’s HS code.

It is not a good business practice to ship before assigning an HS code as this can lead to significant issues that could be expensive, detrimental to both parties’ primary companies, and damaging to one’s reputation.

Following are the other elements where HS Codes are primarily required:

Import and export tariff rates are certain of the product category.

Acquire and analyze Global Trade data.

Internal taxes and liability to pay.

HS Code for Government Officials

HS Codes are significant for government officials to identify goods being imported and exported in order to acquire the proper taxes.

Harmonized System Codes are referred to as HS Codes.

HS classification codes can be seen as the last obstacle that products must overcome before shipping is complete.

Aside from aiding in the clearance of products through customs, these 6–10-digit numbers known as Harmonized Tariff Codes serve two primary functions and purposes:

They identify the goods that cross a nation’s borders for import or export.

Products are categorized and classified in a global system that is utilized for customs clearance.

How to Find HS Code with EximPedia?

HS codes are significant. A business must specify its business scope, which combines the HS codes of the goods it intends to import, export, and trade, as part of the registration procedure.

This list will ultimately determine whether the company needs additional licenses and what steps are required to be taken.

The HS Code list also assists exporters and importers in avoiding frequent foreign exchange issues such as exchange halts at the border, denial of access to import privileges, and additional fines.

EximPedia is a platform where you can obtain your product-specific HS code. They will help to find out the HS code for your products.

They also provide Import Export data, Global trade data, and Custom Data and provide you updated HS codes to grow your business greatly.

Customs

Customs, UN agency collaborate to fight smuggling

The Eyewitness Reporter

The anti-smuggling efforts of the Nigeria Customs Service has received a boost with the support of the United Nations agency,

United Nations Human Settlements Programme, UN—Habitat.

The Customs got the assurance of collaboration from the UN agency on Tuesday, September 19, 2023, when the acting Comptroller General of Customs, Adewale Adeniyi hosted the ambassadors of the global agency led by Dr. Raymond Edoh in his office.

Adeniyi told his guests that the Service, under his watch, will implement every necessary action against saboteurs of Nigeria’s economy to cripple their ‘illegitimate’ business of smuggling.

“On behalf of the entire Management Team of the Nigeria Customs Service, I wish to inform you that we will partner with you in this campaign, and we will grant you all forms of support you may need to carry out this campaign — and I want to assign one of our amiable DCGs, Abba Kura, to work with you closely.”

He appreciated how they traveled from afar to inform the Nigeria Customs Service of their campaign against smuggling, which, according to him, the Nigeria Customs Service has already started yielding positive results in suppressing the menace of smuggling.

The CGC also welcomed Dr Raymond’s offer to engage officers and men of the Service in capacity—building to enhance their understanding of digital literacy skills, adding that the Service has already started embracing technology to advance its work by introducing related courses to officers.

The CGC appreciated the collaborative effort between the Nigeria Customs Service and UN—Habitat and believes that the collaboration signifies a commitment to tackling smuggling and enhancing trade facilitation in the nation, setting the stage for a more prosperous future.

“What we’re trying to do is to raise a modern Customs Service through partnering with stakeholders to achieve our goals because we value partnership, and I am happy that you extended your hands of collaboration to work with us.”

He also appreciated their pledge to train officers and men of the Service in digital literacy skills, assuring that the Service will continue to prioritize proficiency in the fight against smuggling through a technological approach.

He underscored the importance of digital skills, promising that the relevant Service department will enhance trade facilitation.

On his part, the Director of UN—Habitat, Dr. Raymond Edoh, appreciated President Bola Ahmed Tinubu for reposing the responsibility of heading the Nigeria Customs Service on the Acting Comptroller-General, describing him as “a competent Customs officer who knows the terrain and masters the job.”

According to him, they decided to visit the Ag. CGC at the Customs Headquarters to express their interest in partnering with the Service.

He appreciated the Service for being a “gatekeeper of the country” that protects citizens against border threats, stressing that his organization will collaborate with NCS to mitigate the smuggling of illicit goods and train officers and men of Customs on digital literacy skills and certification.

UN-Habitat is the United Nations entity responsible for developing urban policies and translating them into action to create sustainable cities and promote viable urban development and adequate shelter for all.

Customs

MARAN raises alarm over continued depreciation of Customs’ N180 billion boats on Lagos Marina waters —- calls on CGC Adeniyi to deploy the assets

Wale Adeniyi, Ag, CGC

The Eyewitness Reporter

The Maritime Reporters Association of Nigeria (MARAN) has called on the Comptroller General of the Nigeria Customs Service, Adewale Adeniyi, to rescue the N180 billion Customs patrol boats from further depreciation on the Lagos Marina waters.

In a statement issued by the foremost maritime journalists group, the anti-smuggling patrol boats procured by the former President Goodluck Jonathan Administration for the Nigeria Customs Service (NCS), have been abandoned since 2015 at the Marina Lagos waterfront.

The group noted with concern that more than eight years after procurement, and many years after the immediate past administration of Customs led by Hameed Ali promised that the two patrol boats would be rescued from disuse, the boats have rather become a pitiable sight as most of its gadgets have gone useless.

” More pathetic and anger-inducing is the fact that the patrol boats, which consume more than N5 billion as annual maintenance fees have, however, not been put into use even after being commissioned by former Customs boss, Rtd Col. Hameed Ali.

“It is more unpardonable to note that while these vessels are being eaten away daily by termites, the officers and men of the Western and Eastern Marine Commands of the Customs go on patrol operations on the waterways with obsolete and smaller patrol boats that have made them easy prey for smugglers.

“Many have lost their lives in the process.

“Inside sources claimed that the boats are more than overdue for dry-docking and routine maintenance, going by the manufacturer’s specification.

“It will be recalled that the procurement of the patrol boats was initiated by the management of NCS led by the late Abdullahi Dikko Inde, to boost its marine anti-smuggling operations.

“At that time, the NCS operations, according to research, were at their lowest point because of a lack of functional patrol boats and other operational equipment to withstand smugglers with sophisticated fast-moving equipment, fully armed.

“The government awarded the contract to build the boats to a South African firm, Kobus Naval Design , KND, in 2012.

“The then Jonathan-led Federal Executive Council, FEC, approved N3 billion for the procurement of the two NCS patrol boats for the surveillance of Nigeria waters.

“Based on the order, the two vessels, named ”Customs Pride” and” Group of Nine” were slated to be delivered to the NCS within 10 months but were not until April 2015, three years behind schedule.

“The total cost of building the two patrol boats by the firm catapulted to over N180bn from the initial approved sum, raising questions about perceived sharp practices.

“The patrol boats, which were delivered to the NCS in April 2015 have since then berthed at the Marina Waterfronts, Lagos, where it is idling and rotting away at significant cost of maintenance to the NCS.

“While commissioning the two sea-going boats in September 2019, the CG of Customs, Hameed Ali, admitted that the Service has been weak on the waterways compared to the land and that this necessitated the purchase of the two boats.

“This situation, he agreed, led to the death of nine Customs marine officers while confronting deadly petrol smugglers on the sea in 2012.

“It was in honour of this group of nine gallant officers who died in the service of their fatherland that one of the seagoing vessels was named ‘Group of Nine’ while the other represents the ‘Customs Pride’ on the sea.

“One would expect that since the Service now has four marine commands, namely Western Marine, Eastern Maritime, North-Western Marine and North Eastern Marine commands, there is no better time than now to put the boats the effective.

“Presently Nigeria is going through economic turbulence, and cannot afford the culture of waste amplified by the past administration”

The group therefore called on the Acting CG of Customs, Bashir Adewale Adeniyi, to deploy his dynamic attention to this issue and take immediate steps to get the boats functional as the Customs operations, more than ever, require these vessels to confront smugglers.

“We advise that the issues surrounding the abandonment of the vessels should be sorted out immediately or the Customs management should seek the help of experts to rescue them.

“Nigeria Customs management should purge itself of the indifference and above board attitude of its immediate predecessor that led us to this sorry state”

Customs

Nigeria, Republic of Benin deepen cross-border trade facilitation

The Director General of Benin Republic Customs, Alain Hinkati, signing the agreement while CGC Adeniyi looks on

— as importers of both countries can clear goods, pay duties at either of the countries’ ports

The Eyewitness Reporter

The Nigeria Customs Service has signed an agreement with the Customs administration of the Republic of Benin where importers of both countries can use the ports of either of the countries to clear their goods and pay the relevant customs duties.

Consequently, a Nigerian importer can use Benenoise port to clear his goods destined for Nigeria and equally pay customs duties.

The same scenario applies to a Benenoise importer who can equally make use of Nigerian Ports.

This was part of the agreement reached by the two neighboring countries at the end of the two-day interactive session between the Customs Administrations of the two countries.

The session, which started on Monday, 11th September 2023, at the Abuja Intercontinental Hotel, is expected to deepen the relationship between Nigeria and Benin while promoting their age-old bilateral trade ties.

The Acting Comptroller-General of Customs, Bashir Adewale Adeniyi therefore expressed his commitment to synergize with the Benin Republic to enhance trans-border security and regulate trade between the two countries.

“We are building confidence in the system offered by the Republic of Benin; our importers will use their ports and vice-versa.

“If there are people in the Benin Republic who want to use our ports, we try to build trust in our systems.

“And by virtue of this agreement, what it means is that Nigerian importers willing to use the ports in Cotonou can have their goods cleared in those ports because there would be an opportunity for them to pay duties on goods that are liable for payment of duties.”

Adeniyi made this known on Tuesday, 12th September 2023, when he officially received Senior Officers of Benin Customs, led by their Director-General, Alain Hinkati, at the Nigeria Customs Headquarters Abuja, in continuation of their two-day interactive session.

Other areas that the partnership will address include enhancing the proper use of International Transit Guidelines to govern transit-bound goods and fees from Cotonou Port to Nigeria and integration of Nigeria into the Interconnected System for the Management of Goods in Transit.

The Customs boss further highlighted that the treaty between the two Agencies “will prepare the way for an in-depth mechanism to harmonize the import prohibition lists of products banned by the two countries.

“In view of our commitment to curb smuggling and unlawful trade through our borders, we deemed it necessary to meet and form a strong agreement that will support our strategic plans to implement technological-base measures of clearing and tracking of items at our borders.”

The Ag. CGC, however, affirmed that the Nigeria Customs Service has concluded plans to promote good relations with border communities with a view to actualizing full participation of private sectors and frameworks of border Customs Units.

Speaking further, the Ag. CGC appreciated the Benin Customs and Embassy of the country for expressing interest in collaborating with the Nigeria Customs Service to enhance trade facilitation.

“The Customs administration in both countries have a very good idea and technical know-how on what it means with trade; thus, we are back with a renewed enthusiasm to foster our relationship and make an impact on our trade facilitation roadmap.

“We hope that the program will address the issues of trade and set a roadmap for the implementation of new strategies that will enhance the economy and revenue in Nigeria and Benin Republic.”

The Director General of the Benin Republic Customs, Alain Hinkati, said, “It is our hope that the program will address the issues of trade and set a roadmap for implementation of new strategies that will enhance the economy and revenue in Nigeria and Benin Republic.”

According to him, the two organizations need to develop ideas to address transit issues and other progressive measures.

He said with the increasing global security challenges, the need for both customs administrations to work in synergy cannot be over-emphasized, adding that their intended mutualism will boost their relationship to improve the economy of both nations.

Meanwhile, the joined communique signed by the Ag. Comptroller-General of the Customs, Bashir Adewale Adeniyi and Director-General of the Bennese Customs, Alain Hinkati, highlighted that their meeting favours the desire of the two countries’ presidents: Bola Ahmad Tinubu and Patrice Talon to strengthen the shared commitment to enhancing trade facilitation and promoting economic development.

Other areas that will benefit the countries are fostering closer ties to Nigeria and Benin and reactivating the joint committee for monitoring trade and transit relations.