Tariff Classification and Origin Rules
Classification and origin decide the rate, the licence and the statistics code - so errors here propagate into every other domain. The exam tests the six General Interpretative Rules (GIR) and the two origin systems, non-preferential and preferential.
Classification method
- The Chinese tariff follows HS 2022: 21 sections, 97 chapters, 10-digit national codes.
- GIR 1 comes first: heading text plus section, chapter and subheading notes. Only move on if GIR 1 does not resolve the good.
- GIR 2(a) covers incomplete or unassembled goods; 3(a) the most specific description; 3(b) essential character; 3(c) the heading last in numerical order; 4 the most akin goods; 5 packing; 6 comparison at the same subheading level.
Origin
- Non-preferential: wholly obtained, or substantial transformation - a change of four-digit heading or at least 30% value added under Chinese rules.
- Preferential: the FTA product-specific rule controls; RCEP and ACFTA commonly allow regional value content of 40% or a change of tariff classification. Direct consignment is mandatory and the certificate of origin must be issued by the competent authority.
Worked example
A retail gift set pairs a ceramic mug with instant coffee. GIR 3(a) does not single out one heading, so GIR 3(b) asks which component gives the set its essential character. The coffee represents about 70% of the set's value and defines its use, so the set is classified as coffee, not as ceramic ware.
Traps that cost marks
- Jumping to GIR 3(b) before GIR 1 and the chapter notes are exhausted.
- Overlooking a chapter note that excludes the good from the heading you assumed.
- Confusing the non-preferential 30% value-added test with the RCEP 40% regional value content test.