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Classifications. The Integrated System of Classifications The HS and the CN EU Geonomenclature Eurostat metadata server RAMON. The Integrated System of Classifications. PRODUCTS. ACTIVITIES. ISIC Rev. 4. CPC Ver. 2.1. HS 2012. SITC Rev. 4. BEC. Global Level. NACE Rev. 2.
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Classifications The Integrated System of Classifications The HS and the CN EU Geonomenclature Eurostat metadata server RAMON Training course on International Trade in Goods Statistics
The Integrated System of Classifications PRODUCTS ACTIVITIES ISIC Rev. 4 CPC Ver. 2.1 HS 2012 SITC Rev. 4 BEC Global Level NACE Rev. 2 CPA Rev. 2.1 PRODCOM CN MIG EU Level National version of NACE National version of CPA National version of PRODCOM National Level Training course on International Trade in Goods Statistics
General remarks on classifications • Transposition and correlation tables • Are important for: • Time series • Long time analysis • Economic and statistical comparisons Training course on International Trade in Goods Statistics
General remarks on classifications • Concern classifications such as: • SITC: Standard International Trade Classification (Rev.4) • NACE: Statistical Classification of Economic Activities in the European Union (Rev. 2) • CPA: Statistical classification of products by activity in the European Union • PRODCOM: Community Production • BEC (Broad Economic Categories), MIG (Main Industrial Groupings)…. Training course on International Trade in Goods Statistics
General remarks on classifications • Were strongly affected by OPERATION 2007 • Major update of all main statistical classifications at world level: HS, ISIC, CPC, SITC, with: • strong impact on EU classifications CN, NACE, CPA, PRODCOM, …. • strong impact on all main transposition tables Training course on International Trade in Goods Statistics
General remarks on classifications • Classifications for international trade in goods • 2 types of classifications • Product classification • HS: Harmonized System (World level – 5 205 HS6 subheadings in HS 2012) • CN: Combined Nomenclature (EU level – 9 386 CN8 subheadings in CN 2015) • TARIC: Integrated Tariff of European Union (EU level, imports only, ~15 000 subheadings) Training course on International Trade in Goods Statistics
General remarks on classification • Country classification • ISO 3166-1: World level standard • GEONOM: Nomenclature of countries and territories for the external trade statistics of the Union and statistics of trade between Member States: ~250 codes • GEONOM: • Is the EU standard • Is based on ISO 3166-1 Standard, with slight differences for EU reasons Training course on International Trade in Goods Statistics
Harmonized System (HS) • Maintained by the World Customs Organization (WCO)- also HS Explanatory Notes (HSEN) and Classification Opinions • Revised every five years, next 2017 • COM (DG TAXUD) represents EU at WCO • EU Customs Code Committee – HS sector • HS subheadings – 6 first digits of CN 8 digit codes Training course on international Trade in Goods Statistics
Combined Nomenclature (CN): Management • Commission Regulation CN published every October • Amendments reflect technological and commercial developments, needs of EU policies and simplification • HS changes are directly transposed into CN resulting in considerable CN restructuring (in 2007&2012, 10% of codes changed) • EU Customs Code Committee – CN sector (TAXUD/ESTAT) Training course on International Trade in Goods Statistics
Combined Nomenclature (CN): Classification • Principle: uniform application in EU27 • Binding Tariff Information (BTI) can be requested from Customs of any MS, valid in whole EU but only for the holder • EU Customs Code Committee – classification sectors (Mechanical, Agricultural, Chemical, Textiles etc.) • Classification problems may be escalated to the Committee (diverging BTIs, no bilateral agreement) • Possible remedies: - Classification Regulation- CN Explanatory Note (CNEN)- Statement in the minutes of the Committee Training course on International Trade in Goods Statistics
Classification Aids • Self-explanatory texts in EN&FR&DE (and national translations) are self-contained descriptions of codes • TARIC search (subdivides CN, 10 digit codes) • BTI database • ECICS chemical inventory • 3CE Online CN search engine eurostat.prod.3ceonline.com • UK Customs classification guides • CN Explanatory Notes 2011 (new consolidated version 2015 about to be published)Remark: hyperlinks work clicking in slide show mode Training course on International Trade in Goods Statistics
Thank you! Questions? • Jussi Ala-KihniäUnit G1 Business statistics – coordination and registers+352 4301 38180jussi.ala-kihnia@ec.europa.eu Training course on International Trade in Goods Statistics
Classification of a product (1) • The Combined Nomenclature • is based on the HS, and is the base of TARIC • is a mixed nomenclature: tariff and statistical nomenclature, • is a multi-purpose nomenclature that reflects: • Tariff commitments from the EU vis a vis Third countries • EU imports or exports requirements • Statistical requirements
Classification of a product (1) • Specifically, the CN allows: • Monitoring trade agreements and trade negotiations, • Managing CAP and Common Fishery Policy, • Managing other policies, such as environment, health, industrial policies, analysing the development of the internal market and the integration of European economies, and
Classification of a product (1) • Satisfying the needs for statistical information in the economic domain: • measuring trade, • monitoring economic trends and development of market shares of EU industry, • anticipating economic developments, • measuring the competitiveness of the EU economy and EU enterprises, • protecting EU industry (i.e. anti-dumping rules) • Is a detailed classification: 9 386 codes (2015)
Classification of a product (2) Highest level (4 digits) Lower level (intermediate subheading / 5 digits Lower level 6 digits EU level (CN) 8 digits
Classification of a product (2) • the distinction between the products is madeby : • the material a product is made of • the function a product fulfills • the degree of processing of a product • the essential parts of the HS are : • the code • the nomenclature text (including dashes) • the section and chapter notes • the general rules for the interpretation
Classification of a product (3) • These parts are legally binding. • None of these parts can be understood without the other parts. • The explanatory notes are not legally binding. • Notes to sections and chapters: • exclusions • inclusions • definitions • decisions
General Rule 1 • The legal bases for classifications are: • terms of headings • section and chapter notes • general rules
General Rule 2 • General Rule 2a) • Inclusion of incomplete or unfinished goods • Inclusion of unassembled or disassembled goods • General Rule 2b) • Mixtures or combinations of different materials or substances • Goods consisting of two or more materials
General Rule 3 • General Rule 3a) • Classification according to the most specific description (on heading level) • General Rule 3b) • Refers to: • mixtures • composite goods of different materials • composite goods of different components • sets put up for retail sale
General Rule 3 • General Rule 3b) • Classification according to what gives the whole its essential character • Factors defining the essential character: • nature of the material or the component • bulk, quantity, weight • value • role of the constituent material
General Rule 3 • General Rule 3b) • Goods made up of different components: • inseparable or separable components • adapted to one another and mutually complementary • form a whole • normally not offered for sale separately • in general put in a common packing
General Rule 3 • General Rule 3b) • Goods put up in sets for retail sale: • at least two different articles or different headings • to meet a particular need or specific activity • for direct sale to users (packing) • General Rule 3c) • Last in numerical order
General Rule 4 • Classification under appropriate heading: • To which they are most akin (in practice never applied)
General Rule 5 • General Rule 5a) • For cases, boxes and similar containers: • specially shaped • suitable for long-term use • presented with the articles • normally sold with • do not give the whole its essential character • General Rule 5b) • Packing materials and packing containers • Applies to containers which are normally used • Not binding for containers for repetitive use
General Rule 6 • Classification in subheadings (according to terms of subheadings + subheadings notes) • Application of the general rules mutatis mutandis