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International transportation of goods requires specialized knowledge and precise documentation. This particularly concerns dual-use goods, which in the international classification of accompanying documents are identified by an HS code. Experts at Dragon Logistics emphasize that errors in documentation can result in significant financial losses for a business.
HS Code — what it is and why it matters
Harmonized System Code is the full name of the international standard for identifying goods in international shipments. It is a universal classification system under the World Customs Organization, allowing the most accurate determination of the category of imported goods, regardless of the country.
The HS code must be included in all accompanying documents, such as:
- invoices;
- shipping documents;
- customs declarations;
- and others.
It is essential for export control, as well as for issuing import and delivery licenses and certificates. The classifier also affects the calculation of customs duties. Therefore, it is extremely important to correctly determine the code and provide the most accurate description of the cargo.
The need for such classification is explained by the existence of dual-use goods. These are products initially manufactured for civilian purposes but which may also be used for military applications.
Examples of dual-use goods:
- GPS navigation systems;
- unmanned aerial vehicles (drones);
- various chemicals and reagents;
- electronic products (components and microchips);
- data transmission equipment (routers, smartphones);
- industrial machines and equipment.
The full list of such goods is established in international trade agreements and Ukrainian legislation. Every importer should understand what an HS code is to avoid issues in their operations. It should be noted that the international code consists of 6 digits, while the Ukrainian counterpart in the Ukrainian Commodity Nomenclature for Foreign Economic Activity (UKT ZED) contains 10 digits. The UKT ZED is designed for more precise classification, taking into account national specifics and the current situation in the country.
HS Code: classification errors and borderline codes
Every importer must be aware of what constitutes dual-use goods. If your cargo falls into this category and the documents are incorrectly completed, customs may identify it as suspicious.
It is crucial to understand the classification accurately, as some HS codes are separated from specially controlled categories by a very fine line. For example, chips and microcircuits used in standard consumer computers can also be used in specialized military equipment.
Possible consequences of incorrect classification:
- cargo delays and missed delivery deadlines;
- confiscation of goods;
- fines and additional duties.
As a result, the importer suffers not only financial losses but also reputational damage, losing partners’ trust. It should also be understood that violating export control regulations may result in criminal liability.
Proper logistics is key to successful international trade. If you transport goods from China, it is important to understand the national specifics of the country. In addition to international standards, each country may have its own list of dual-use goods. Most classification errors occur when processes are rushed. An HS code may be copied directly from the manufacturer’s invoice without verifying the product category or technical specifications.
You can check the code’s relevance and compliance for Ukrainian customs on the official service website, within the UKT ZED. Comparing code values is also possible using the list of dual-use goods approved by the Cabinet of Ministers of Ukraine. It should be noted that this list is regularly updated.
Dragon Logistics experts recommend choosing a reliable logistics partner for international shipments. A reputable company with experience in this field and a professional team, including a customs broker, can deliver Chinese cargo on time and without issues.