Wyoming Business Tips for April 20-April 26
A weekly look at Wyoming business questions from the Wyoming Small Business Development Center (WSBDC), part of WyomingEntrepreneur.Biz, a collection of business assistance programs at the University of Wyoming.
John C Privette, WSBDC, regional director
“What compliance requirements must I meet to export my product?” Sam, Cheyenne
When exporting products, compliance information for meeting government agency and shipping company requirements is always more detailed than when selling to the U.S. market. This information is transferred in certificates of origin, commercial invoices and NAFTA certificates of origin if shipping to Canada or Mexico, among other product-specific export documentation.
The first requirement is to determine your product classification. Every product imported and exported is assigned a classification code corresponding to the type of product. These codes are used for statistical reporting purposes by countries worldwide and also used by custom officials to determine tariffs. Under the Foreign Trade Regulations, exporters are legally required to include the correct classification code on export documentation.
The Harmonized Commodity Description and Coding System (HS) codes are used to classify products for customs. Use of these standardized codes ensures that custom officials are referring to the same item when classifying the product for tariff rates.
The HS assigns a specific six-digit code to classify all products or commodities with the country option to create an additional four-digit code to provide more product detail. In the U.S., a 10-digit code is used to classify products and is referred to as the Schedule B number.
Find the Schedule B number by using the free online Schedule B search at http://www.census.gov/scheduleb.
For example, to export women’s knitted wool sweaters, codes would appear like this:
-- 62.10 ... Sweaters or similar, knitted.
-- 62.10.11 ... Of wool, HS.
-- 62.10.11.0020 ... women’s wool, Schedule B.
Exporters need to know the product HS code and Schedule B number:
-- To determine import tariff rates for the destination country and determine whether a product qualifies for a preferential or lower tariff under a free-trade agreement such as NAFTA.
-- To complete the required shipping documents.
-- To comply with export license requirements, if applicable.
A blog version of this article and an opportunity to post comments is available at http://wyen.biz/blog1/.
The WSBDC is a partnership of the U.S. Small Business Administration, the Wyoming Business Council and the University of Wyoming. To ask a question, call 1-800-348-5194, email firstname.lastname@example.org or write 1000 E. University Ave., Dept. 3922, Laramie, WY, 82071-3922.