Product classification is an internationally shared process
among all trading countries. In the U.S., products are classified
according to the Harmonized Tariff Schedule of the U.S. (HTSUS).
When entering goods into the U.S., the HTSUS- designated 10-digit
HTS code is required and used to determine the applicable duty
rate. The HTS is declared by the importer and used to assess
tariffs, determine eligible free trade agreements, generate trade
statistics, and monitor quota or controlled goods.
U.S. Customs and Border Protection (CBP) requires an importer of
record, among other responsibilities, to exercise reasonable care to determine the
classification of a good, pay the correct duties, and appropriately
avail itself of duty saving opportunities like free trade
agreements, China tariff exclusions, and other duties. Failing to
meet the reasonable care standard exposes an importer to
potentially high penalties under 19 U.S.C. 1592 and can subject an importer
