TARIFF CLASSIFICATION

COUNTRY COORDINATOR: SINGAPORE

 Introduction

The 11th AFTA Council Meeting in Kuala Lumpur agreed to the following:

  1. endorsement of AHTN (22/8/97) which was finalised by the BPS countries

  2. that all ASEAN countries should adopt an AHTN latest by the year 2000

  3. that the remaining countries identify their additional tariff nomenclature requirements for inclusion in AHTN (22/8/97)

  4. these would then be used by the ASEAN Secretariat to determine whether the total number of tariff lines would exceed 7,000 tariff lines.

At the 12th AFTA Council Meeting in the Philippines on 6th October 1998, the Council noted that some countries were of the view that fixing a numerical target was restrictive, particularly in the light of the different domestic circumstances of Member countries and different tariff and industrial policies. The Council therefore agreed that rather than fixing a numerical target, the AHTN should contain a reasonable number of tariff lines without first pre-empting Member Countries’ requirements by fitting a numerical target prematurely.

In the statement of Bold Measures presented at the 6th ASEAN Summit, the Leaders agreed that the six original signatories to the Agreement on CEPT Scheme for AFTA would advance the implementation of AFTA by one year from 2003 to 2002. They also agreed to achieve a minimum of 90% of their total tariff lines with 0-5% by the year 2000. As such, the additional requirements of member countries for inclusion in AHTN (22/8/97) should be made with the consideration of this latest development of AFTA. In addition, the AHTN tariff lines should be reviewed against the WCO HS 2002 requirements before implementation in 2002.

Long term objective

To promote transparency, consistency and uniformity in the classification of goods within ASEAN through the implementation of an ASEAN Harmonised Tariff Nomenclature (AHTN). To facilitate trade through predictable and assured classification rulings and decisions.

Policy Implementation and Work Programme

Short term objective:


(1) To facilitate trade between ASEAN Member Countries through consistent, predictable and assured classification rulings and decisions.

(2) To promote transparency, consistency and uniformity in the classification of goods within ASEAN Member Countries through the implementation of an ASEAN Harmonised Tariff Nomenclature (AHTN).

(3) To provide greater comparability of intra-ASEAN trade flows by extending common commodity classification beyond the 6 digits of the Harmonized System to the 8 digits of the AHTN.


Sub-Element 1:

 Finalisation of the AHTN by the year 2000, for implementation latest by 1 January 2002, so as to coincide with the implementation of the WCO HS2002.


    Strategy 1:

Adoption of the AHTN(22/8/97) as the common base for harmonisation of national tariff nomenclatures in ASEAN


Activity 1:

Obtain the approval of the AFTA Council for the adoption of the AHTN(22/8/97) as the basis for harmonisation of national tariff nomenclatures in ASEAN and policy guidelines relating to its content.

Output:
Approval of the AFTA Council on the adoption of the AHTN(22/8/97) and policy guidelines relating to its content.


    Strategy 2:

Revision of the AHTN(22/8/97) to take into account of the requirements of Member Countries in accordance with the Ministerial guidelines obtained under Strategy 1, and to incorporate the WCO HS2002.


Activity 1:

Member Countries to submit their proposals for addition to the AHTN(22/8/97) by first week of June 1999.

Output:
Aggregated proposals of further 6 Member Countries for AHTN additions.


Activity 2:

Singapore to consolidate additional requirements of the non-BPS countries to produce draft AHTN (Revision 1) to include national requirements of all Member Countries, according to the 12th AFTA Council policy guidelines.

Output:
Revised AHTN (Revision 1) circulated to Member Countries for review, by the Fourth ECCM.


Activity 3:

Member Countries to discuss and comment on draft AHTN (Revision 1) at ECCM and to take into consideration the guidelines issued by the WCO on HS2002 revisions.

Output:
ECCM’s comments on AHTN (Revision 1)


Activity 4:

Singapore to produce draft AHTN (Revision 2) taking into account ECCM’s comments, suggestions and decisions to review AHTN (Revisions 1), and the AFTA Council policy guidelines. If necessary, a consultant can be engaged to resolve any technical difficulties that could arise in conforming to requirements of the HS 2002, once it is available, and the possibly revised tariff requirements of all Member Countries when the AFTA is implemented in 2002.

Output:
AHTN (Revision 2) circulated to Member Countries for review.


Activity 5:

Member Countries to discuss and comment on draft AHTN (Revision 2) at the ECCM.

Output:
ECCM to agree amendments to AHTN (Revision 2);
report to AFTA Council on progress made and any unresolved problems.


Activity 6:

Singapore, with the help of the consultant for further technical work (if necessary), to finalise AHTN if approved by AFTA Council, or revise text in accordance with directions received.

Output:
Version of AHTN (Revision 3/Final) completed by end of 2000.


Activity 7:

Member Countries with large tariff lines, to take advantage of the implementation period (2001-2002) to further simplify their nomenclature requirements and submit proposals for further simplification of the AHTN to Singapore, before 1 January 2002

Output:
Final version of AHTN implemented on 1 January 2002.


    Strategy 3:

Implementation of AHTN by all Member Countries by the year 2002


Activity 1:

All ASEAN Member Countries to submit implementation plans

Output:
Collection of implementation plans of all Member Countries


Activity 2:

Formulation of Protocol governing the Implementation of the AHTN.

Output:
Protocol drafted


Activity 3:

Obtain regular feedback from Member Countries on the stages of implementation

Output:
Up to date information on progress made in implementation of AHTN


Activity 4:

Maintenance of the AHTN in accordance with the Protocol

Output:
National nomenclatures which include all the latest HS amendments at 6-digit level and which at 8-digit level reflect only the current needs of Member Countries in conformity with the AFTA Council guidelines


Sub-Element 2:

To introduce consistent national commodity classification in all ASEAN Member Countries by sharing of information and implementation of pre-entry classification


    Strategy 1:

Train maximum possible number of customs officers engaged on commodity classification


Activity 1:

Consultant to adapt existing practical commodity classification training material and develop training course on the 8-digit AHTN

Output:
AHTN commodity classification training course available


Activity 2:

Conduct two AHTN training courses to train trainers from all ASEAN Member Countries.

Output:
Trainers trained


Activity 3:

Trainers to train all customs officers engaged on commodity classification

Output:
Customs officers trained on use of AHTN in all ASEAN Member Countries


Activity 4:

Member Countries to report on follow-up to the training of trainers

Output:
Report on follow-up undertaken at national level


    Strategy 2:

Share information on national classification decisions and best practices, and implement pre-entry classification.


Activity 1:

Collect lists of classification rulings at the 7-8th digit level of the AHTN from all Member Countries

Output:
Collection of classification rulings at the 7-8th digit level of the AHTN from all Member Countries


Activity 2:

Compile first edition of ASEAN Commodity Classification Compendium and Best Practices (ACCC) and distribute to Member Countries. The Compendium will include best practices on classification compiled from technical advice and rulings from the WCO up to the 6th digit level, and from the ASEAN rulings for the 7-8th digit levels of the AHTN.

Output:
First edition of ACCC


Activity 3:

Provide mechanism for future regular updating of the ACCC

Output:
Mechanism to update ACCC


Activity 4:

Member Countries to put in place pre-entry mechanisms to provide specific classification rulings upon requests by traders, before importation of the goods, that would be binding to the customs administrations providing it.

Output:Pre-entry classification mechanisms in Member Countries


Activity 5:

ASEAN Secretariat to monitor implementation of the pre-entry classification systems in Member Countries. Member Countries to provide ASEAN Secretariat status of their implementation of pre-entry classification. Private sector views can also be sought.

Output: Report on status of implementation of pre-entry classification systems in Member Countries to be made to ECCM


Management

Management issues pertaining to the implementation of the AHTN will be covered in the Protocol implementing the AHTN. As with the other customs areas, the Country Coordinator will take the lead in initiating and coordinating the activities laid out in the plan. This should include timing considerations, such as, when to commence each activity covered by the plan. The Country Coordinator will be assisted by the ASEAN Secretariat, and will consult the ECCM and the ASEAN DGs of Customs on relevant policy and implementation matters.

As a standard operating procedure, the Country Coordinator should liaise closely with the Coordinators on Training and Human Resource Development and Technical Assistance to CLMV in order to optimise resources.

Control, Monitoring and Review Mechanism:

To make a review of the activities engaged upon completion of each activity, or by the end of year 2002 which is the targeted time frame for implementing the AHTN.