HS Code Lookup - 6 coding rules to remember

The basic content of the 6 general rules is as follows:

RULE 1

"The titles of Sections, Chapters and Sub-Chapters are provided for ease of reference only. For legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided the headings or Notes do not otherwise require, according to the provisions below."

The content of this rule has several important ideas:

1. The names of Parts, Chapters and Sub-Chapters are for general guidance only and are not sufficient for classifying goods (determining HS codes).
2. Important factors for classification:
   2.1 Specific content of each group
   2.2 Notes (explanations) in Sections and Chapters
3. If the classification cannot be made based on item 2 above, then the following rules will be applied in turn.

For example, Chapter 39 is called “Plastics and articles thereof”. But plastic children's toys are not covered under this chapter, but under chapter 95.

RULE 2

Divide into 2 small rules:

Rule 2a:

"An article classified in a heading shall be classified in that heading in its incomplete or unfinished state if it has the essential character of the article when complete or finished. The same shall apply to an article which is complete or finished or has the essential character of the article when complete or finished (or which is classified as complete or finished under the provisions of this Rule) but not assembled or disassembled."

For example: Bicycles without saddles and pedals (incomplete) are still classified under bicycle code (87.12). Bicycles disassembled are still classified under bicycle code.

Rule 2b:

"A material or substance classified in a certain heading includes mixtures or compounds of that material or substance with other materials or substances. Goods consisting wholly of one material or substance, or consisting partly of that material or substance, are classified in the same heading. The classification of goods consisting of two or more materials or substances is subject to Rule 3."

RULE 3

When by virtue of Rule 2(b) or for any other reason goods are prima facie classifiable under two or more headings, they shall be classified as follows:

"The headings which give the most specific description shall take precedence over those which give a more general description for the purpose of classifying the goods. However, where two or more headings each refer to only part of the materials or substances contained in mixed or composite goods, or in the case of goods put up in sets put up for retail sale to only part of the goods, 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."

Rule 3b:

"Mixtures 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 were composed of the material or component which gives them their essential character."

Rule 3c:

"When goods cannot be classified by reference to Rule 3(a) or 3(b) above, they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration."

RULE 4

Goods which cannot be classified in accordance with the above Rules shall be classified in the heading appropriate to the goods to which they are most akin.

RULE 5

The following regulations apply to the following goods:

Rule 5a:

"Camera or cinematographic 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 sold, are to be classified with such articles. However, this rule does not apply to packaging which is more essential than the article it contains."

Rule 5b:

"Subject to Rule 5(a) above, packaging is to be classified with the goods when it is of a kind normally used for the goods concerned. However, this rule does not apply to packaging which is clearly suitable for repeated use."

RULE 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 of any relative subheading notes and, mutatis mutandis, to the above Rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this Rule, the relative Section and Chapter Notes also apply, unless the context otherwise requires."

Download full Circular 103/2015/TT-BTC

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