M4.2 The Customs Tariff Flashcards
Tariff and GIRs, Notes Phrases Terms, Tariff Schedules
How can the tariff levy paid on particular classes of imports be used?
1) raise money for the government
2) protect dometic industries from foreign competition
What is the Customs Tariff
Schedule of the Customs Tariff Act
Heirarchal numeric system used to classify goods.
How many sections and chapters is the customs tariff divided and sub-divided into?
Twenty-one sections and ninety-nine chapters
21 sections and 99 chapters
What are the General Interpretive Rules intended for?
to support legal interpretation of the Harmonized Systems HS
What are the classification of goods in the HS governed by?
six international GIRs plus three Canadian Rules
must be considered in sequential order
GIR 1 - sections chapter and sub chapters are for reference.
The titles of Sections, Chapters and sub-Chapters are provided for ease of reference onlyfor legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require, according to the following provisions.
GIR 2 (a) - Essential Character of the goods
reference to that article incomplete or unfinished, provided that, as presented, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also be taken to include a reference to that article complete or finished (or failing to be classified as complete or finished by virtue of this Rule), presented unassembled or disassembled.
GIR 2(b) Essential Character of the goods
reference to mixtures or combinations of that material or substance with other materials or substances. Any reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classification of goods consisting of more than one material or substance shall be according to the principles of Rule 3.
GIR 3(a)
most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.
GIR 3(b)
Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to Rule 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.
GIR 3(c)
When goods cannot be classified by reference to Rules 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.
GIR 4
Goods which cannot be classified in accordance with the above Rules shall be classified under the heading appropriate to the goods to which they are most akin.
GIR 5(a)
Camera cases, musical instrument cases, gun cases, drawing instrument cases, necklace cases and similar containers, specially shaped or fitted to contain a specific article or set of articles, suitable for long-term use and presented with the articles for which they are intended, shall be classified with such articles when of a kind normally sold therewith. This Rule does not, however, apply to containers which give the whole its essential character.
GIR 5(b)
Subject to the provisions of Rule 5(a) above, packing materials and packing containers presented with the goods therein shall be classified with the goods if they are of a kind normally used for packing such goods. However, this provision is not binding when such packing materials or packing containers are clearly suitable for repetitive use.
GIR 6
For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related Subheading Notes and, mutatis mutandis, to the above Rules, on the understanding that only subheadings at the same level are comparable. For the purpose of this Rule, the relative Section and Chapter Notes also apply, unless the context otherwise requires.
GIR 2(a) example - Bicycles that are shipped unassembled
Bicycles that are shipped unassembled are classified in the same heading as a finished bicycle, and a wooden table that is unfinished is classified in the same heading as a finished table. In both cases, the unassembled and unfinished goods have the essential character of the finished product and are recognizable as such.
GIR 2(b) Example - mixtures or combinations
Heading 44.02 includes wood charcoal, so, according to GIR 1, it is correctly classified in that heading. However, if it has been treated with a chemical so that it is easily lit, Rule 2(b) applies. The charcoal has been combined with another substance, yet is still readily recognizable as wood charcoal.
GIR 3(a) Example - More than one heading applies Essential Character,
heading with the most specific description.
Consider a wooden desk. The heading that indicates the essential character would be the heading for a desk, rather than the heading for items made of wood, which is a more general description.
GIR 3(b) Example - Mixtures/combinations - select the heading that occurs last in numerical order.
An example of GIR 3(c) is a booster kit you keep in the trunk of your car. The kit consists of a carrying case, booster cables (heading 85.44), a fleece blanket (heading 63.01), knitted cotton gloves (heading 61.16), a PVC rain poncho (heading 39.26) and a safety triangle (heading 39.26). There is no single item giving the essential characteristic – all of them work together to meet a particular need. The kit is classified as booster cables, since booster cables appear last in the tariff.
GIR 4 - Example - Most Akin - select the heading for goods to which they are most alike.
It is difficult to provide an example for this rule, as it is generally used when classifying new products. In this case, you would classify the goods in the same heading where you would classify goods that are most like the new product. We often see new technology classified using GIR 4.0
GIR 5(a) - Example - Cases and packing materials
An example of GIR 5(a) is a violin in a specially built case, a ring in a crushed velvet ring box, or a camera in a travel case with compartments for lenses. provides for the classification of specific goods, such as specially fitted cases such as those for cameras, guns, and jewelry. These cases are suitable for repeated use and are shipped with the goods that they are designed to hold. These cases are classified under the same classification as the goods they hold.
GIR 5(b) Example - packing such as bags, cartons, and crates, are classified with the goods that they hold only if the packing is regularly used for these goods.
Consider a cardboard shoebox. Shoes are packed inside and the shoebox is classified with the shoes since a shoebox is regularly used for shoes and the shoebox is not designed for repeated use.
However, re-usable pallets that are used to hold various goods cannot be classified with the goods that they hold. The pallets must be classified in their own heading.
