What is the Harmonized System used for in international trade?

The Harmonized System is used for classifying traded goods.

Usually called the HS, this international product-nomenclature system gives goods standardized codes for customs and trade statistics. Countries use those codes to identify products, apply tariffs, enforce regulations and compile import and export data.

The World Customs Organization developed the system, and the HS Convention entered into force in 1988. Its structure begins with broad sections and chapters, then becomes more specific through headings and subheadings. The first six digits are internationally standardized, while countries may add further digits for national tariff purposes.

The HS is not an exchange-rate system, a cargo-insurance policy or a ship-tracking network. Classification can still be complicated because a product’s material, function, processing stage and intended use may affect its code.