REPORT CUSTOMS PROCEDURES THE PRACTICE THE HS CODES DETERMINATION OF YOGURT AND TEXBOOKS

4 CHAPTER 2: ANALYSIS OF HS CODE DETERMINATION FOR SELECTED PRODUCTS .... Global regulation of the World Customs Organization, this type of code helps us to know most of the goods info

TON DUC THANG UNIVERSITY FACULTY OF BUSINESS ADMINISTRATION

INTERNATIONAL BUSINESS

REPORT CUSTOMS PROCEDURES THE PRACTICE THE HS CODES DETERMINATION OF YOGURT AND TEXBOOKS

Lecturer: Tran Nguyen Chat

Class: 19DF0701

Group: 1

LIST OF GROUP MEMBERS

ID

Duty Evaluation Signature

1 Huynh Muoi Luy 719D0082 Introduction

Conclusion Edit Picture Contribute Ideas

COMMENTS FROM LECTURER

TABLE OF CONTENTS

INTRODUCTION 1

CHAPTER 1: BRIEF INTRODUCTION OF THE HARMONIZED SYSTEM 3

1.1 Definition and structure of Harmonized System 3

1.2 The significance and objectives of Harmonized System 3

1.3 A summary of the HS Convention formation process 4

1.4 Review the six HS code applications rules: 4

CHAPTER 2: ANALYSIS OF HS CODE DETERMINATION FOR SELECTED PRODUCTS 8

2.1 General introduction of selected products 8

2.1.1 Overview of TH True Milk Brand 8

2.1.2 Overview of Cengage VN, UEH University and Hong Duc Publishing House 10

2.2 The procedure for determining the HS code 11

2.2.1 HS code for TH True Milk Blueberry yogurt 12

2.2.2 Macroeconomics Textbook N Gregory Mankiw 17 –

CHAPTER 3: FINDINGS 22

3.1 Advantages: 22

3.2 Difficulties: 22

3.3 Risks, experience gathering, and lessons learned: 23

CONCLUSION 24

INDEX OF REFERENCE 25

APPENDIX 26

PRODUCTS OF THE GROUP 26

LIST OF FIGURES

Figure 1 Results from the import and export tariff schedule 2021 Yogurt 13–

Figure 2 Search results from Case Law Yogurt 14–

Figure 3 Search results from Case Law Yogurt 15–

Figure 4 HS code results of TH True Milk Blueberry yogurt 16

Figure 5 Search results from import and export tariff schedule 2021 Book 18–

Figure 6 Search results from Case Law Book 19–

Figure 7 HS code result of Education Book 20

ACKNOWLEDGEMENT

In order to complete the research project, our team would like to express our sincere and deepest thanks to Ms Chan Nguyen Chat for directly guiding and reminding our team during the implementation of the research topic to complete the research into a report At the same time, I would also like to thank my family and friends who have always encouraged and supported me during the completion of this thesis

In the process of implementation, although we have tried to understand and absorb the contributions of teachers, teachers and friends, consult many domestic and foreign documents, the research content still cannot avoid shortcomings Omission Our team is looking forward to receiving comments from teachers, teachers and friends to improve this research topic

In the first lesson, the lecturer will introduce the issue and related documents to facilitate students in self-study Following an overview of the content of the lessons, we will begin

to learn how to classify goods using the Harmonized System (HS) - using numbers to classify things, and most countries around the world utilize it as a base to meet the needs

of international trade In all the chapters studied, the group found the lesson on classifying goods by HS code quite interesting In addition, in practice, the HS system has organized more than 98% of goods traded on the market Global regulation of the World Customs Organization, this type of code helps us to know most of the goods information about codes, products, goods, it is built to become the "common language" of In international trade, it also plays an important role in the process of determining tax rates and helping goods to be cleared quickly as well as enjoy preferential treatment for member countries

of free trade agreements, It is for these reasons that motivated my group to learn and choose

as a practice topic

To better understand this system, our team selected two products to learn and identify their HS codes Regarding the process, my group went to the supermarket and found two different types of goods The first product is in the F&B industry (TH True Milk Blueberry yogurt), and the other is in the education - stationery industry (Macroeconomics textbook) Regarding yogurt, this is one of the products from the TH True Milk brand - a brand of clean milk that comes from the standard fresh milk of the TH farm, and the Macroeconomics textbook product from Hong Duc Publishing House in collaboration with Cengage Learning Vietnam Co., Ltd and University of Economics Ho Chi Minh City (UEH) to import, translate and publish the Vietnamese version

The content of this exercise is summarized in three main chapters:

Chapter 1: Brief introduction of the Harmonized System

In this chapter, the group will briefly introduce the concept of the Harmonized System, outline the HS convention, the importance of classifying goods by HS codes and recall the 6 rules of applying HS codes learned in class

Chapter 2: Analysis of HS code determination for selected products

From the introduction of concepts and rules learned in Chapter 1, in this chapter we will analyze and determine the HS code from the product that the group has chosen, which

is TH True Milk Blueberry and Blueberry Yogurt and Textbook of Macroeconomics.Chapter 3: Findings

In the last chapter, the group will raise the issues that the group has drawn from the group discussion and summarize the advantages, difficulties, risks, experiences, and lessons when looking up the HS code

CHAPTER 1: BRIEF INTRODUCTION OF THE HARMONIZED

SYSTEM

1.1 Definition and structure of Harmonized System

The HS Code (Harmonized System Code) is a code used to identify imported and exported goods worldwide It is an internationally standardized system of names and codes used by the World Customs Organization - WCO to classify commodities on a global scale.Basically, the Harmonized System (HS Code) structure includes several elements split from large to small as chapters, headings, sub-headings, tariff lines, and national tariffs Our country now uses an 8-digit HS code, although in some other countries, this number might be 10 or 12 digits long

More specifically, there are 97 chapters in total, with chapters 98 and 99 being specific

to each country, and the first two characters describing the general description of the commodities The next two letters are called Heading and are used to categorize products into common groups Sub-headings are grouped into more generic groups from the group, and each country determines the final Tariff line

1.2 The significance and objectives of Harmonized System

Many stakeholders participating in the import and export process will profit from the proper use of HS codes for each type of commodity The most common role of the correct classification of HS codes for the management agency is to correctly identify the categories

of goods, thereby providing how to apply taxes and the amount of tax that the Customs must collect import and export enterprises in order to contribute to the enforcement of domestic laws and international treaties; support for the analysis of micro, macro, and international trade negotiations

In detail, The HS code's role is to ensure that firms comply with domestic and international legislation To begin with, HS codes assist us in classifying goods and determining the appropriate tax rate in accordance with state regulations Furthermore, businesses will be aware of all taxes that must be paid, avoiding the situation in which businesses that have to pay a lot of tax frequently have to go through tax refund procedures, which takes a lot of time and effort for stakeholders Finally, businesses benefit from free trade agreements (FTAs) in accordance with regulations The early preparation of procedures and the correct identification of the HS code can assist firms in making a good impression and reputation for Customs authorities, resulting in faster customs clearance of goods

1.3 A summary of the HS Convention formation process

The HS Convention, formally known as the "International Convention on Harmonized Commodity Description and Coding Systems," was adopted by the World Customs Organization in Brussels (Belgium) in 1983 and went into effect on January 1,

1988 It is a harmonized system of product description and coding According to research data, this is a reasonably good result of 60 founding member countries' customs organizations and 20 other international organizations studying for nearly ten years (1976

- 1983)

The HS convention is composed of 20 articles, some of which address the responsibilities of member nations, the application of HS independent territories, dispute resolution, and the work of the Customs Cooperation Council The HS Convention was established as the most effective legal mechanism for ensuring a harmonized product description and coding system, thereby establishing a global commodity categorization system Furthermore, this convention facilitates international trade negotiations, contributes to the reform of Customs administrative procedures, accelerates regional and global integration, and prevents smuggling and fraud in trade, thus protecting businesses' interests and assisting in the automation and modernization of customs procedures

Vietnam joined the HS Convention on July 1, 1993, but it was not until March 6,

1998, that the President of Vietnam recognized it with Decision No 49/QD-CTN As a result, the HS Convention entered into force officially in Vietnam on January 1, 2000 This Convention currently applies to more than 98 percent of all goods commerce, and updates and additions to the substance have occurred in 1992, 1996, 2002, 2007, 2012, and 2017

1.4 Review the six HS code applications rules:

Rule 1: General rule of thumb

The designations of Sections, Chapters, and Sub-Chapters are simply for reference; they are insufficient to classify items (determining HS codes)

Important classifying factors include:

- 2.1 Each group's specific content

- 2.2 Section and Chapter Notes (Explanations)

If it is not possible to categorize based on item 2 above, the following rules will be followed in order "Plastic and objects of plastic," for example, is the title of Chapter 39 Plastic children's toys, on the other hand, are dealt with in Chapter 95, not Chapter 39.Rule 2: In the same group, unfinished goods and compounds

a) When a good is classified under a heading, the finished or unfinished product falls under that heading if it shares the same fundamental features as the dead or finished item The same classification applies to products in their complete or finished form or to goods in their finished or finished condition that have the essential feature of the good (or

to be classified as finished or finished goods in accordance with the provisions of this Article) This rule must be followed), but not assembled or disassembled

Bicycle without saddle, pedals (incomplete) still classed as a bicycle (87.12) For example, to make transporting the excavator easier, the parts are dismantled, and each machine part is assigned an HS code based on the vehicle

For the purpose of its establishment, the HS Convention was born as the most effective legal tool to ensure a harmonized system of description and coding of goods, thereby becoming a global commodity classification system In addition, this convention creates favorable conditions in international trade negotiations, contributes to the reform

of Customs administrative procedures, accelerates integration with the region and the world, and prevents smuggling And fraud in trade, protecting the interests of businesses and thereby helping to automate and modernize customs procedures

b) If a material or substance is categorized under one category, a mixture or compound of that material or substance with other materials or substances is classed under that heading as well Goods composed entirely of one material or substance must be classed together or part of that material or substance Rule 3 governs the classification of things made of two or more materials or substances

Mixture A comprises two goods, Product 1 (06.07) and Product 2 (06.07) Mixture A's HS code will be applied to heading 06.07

Rule 3: At first look, goods can be classified into a variety of categories

When items can be categorized into two or more headings at first glance due to rule 2(b) or for any other reason, the classification shall be as follows:

a) When classifying items, the groups with the most specific descriptions will take precedence over the groups with the most generic descriptions When two or more headings

each referring to a part of the material or substance contained in a good is a mixture or compound, or to only a part of the good in the case of a good inset put up for retail sale, these headings are deemed to give an equal characterization of the said goods, even if one

of the headings is a mixture or compound

b) Mixed goods consisting of different materials or goods made up of different components, and goods in the form of sets for retail sale, if not classified under Rule 3( a), are classified according to the material or component which confers their essential character

c) Where the goods cannot be classified according to rules 3(a) or 3(b) above, they shall be classified in the last heading in numerical order among the equivalent headings under consideration

Rule 4: The most similar goods

Commodities that cannot be categorized according to the preceding rules are placed

in the heading that corresponds to the most similar class of goods

Rule 5: Containers, packaging

The provisions below apply to the commodities listed below

a) Camera and camcorder cases, musical instrument cases, pistol holsters, drawing tool cases, jewelry cases, and similar cases that are suitable or uniquely made for storing products or sets These products are grouped with certain commodities that can be used for

a long period and that accompany the products when they are sold This notion, however, does not apply to packaging that is significantly superior to the goods it contains

b) In addition to rule 5(a), the packaging in which the good is included is classed with the good if the packing is of a type that is commonly used for the good This approach, however, does not apply to packages that are plainly designed to be reused

Rule 6: Explain how to properly classify and compare

For the sake of legality, the classification of goods into the subheadings of a heading shall be determined in accordance with the content of each subheading, the relevant subheading notes, and the above rules with amendments detail as appropriate, provided that only subheadings of the same level can be compared Under this rule, the relevant section and chapter notes also apply unless the description in the subheading requires otherwise

For example 1 brick compares to 1 tile, 2 tiles compares to 2 tiles& (the dash is a bullet point "-" before the item name in the description of the goods of the tariff).

When looking up HS code, apply rule 01 and rule 06, then rule 2, Rule 3, Rule 4 or Rule

5, respectively

CHAPTER 2: ANALYSIS OF HS CODE DETERMINATION FOR

SELECTED PRODUCTS

Following the process of selecting products from the supermarket, my team members were given 1-2 days to conduct their own research and then discuss in an online group; as a result, we opted to select two products from two distinct industry areas (F&B and education) to identify their HS codes This chapter will be divided into two parts: a broad introduction to the products chosen by my team, and the process of looking for and determining HS codes for them

2.1 General introduction of selected products

2.1.1 Overview of TH True Milk Brand

TH True Milk is a brand under the management of TH Corporation and is known in full as Milk Corporation, and as the TH True Milk has since proven to be dominant in the market and known as the "dominant clean Milk market" in Vietnam Essentially, the TH was formed and developed based on "the true story of the TH" which utilized modern technology from completely fresh milk raw materials and has produced thousands of real milk products of high quality This fresh quality helps the brand create a bond with the consumer The TH True Milk sees strength as the foundation of brand quality products that must be coupled with the cost that satisfies consumer needs Due to its multi-dimensional power, high prestige and solid standing, the TH True Milk has built and communicated to consumers in a simple but genuine philosophy They carry a mission of distributing goods throughout the world, so TH has built a series of chain stores to supply enough and timely clean, safe, fresh and nutritious food products to reach their consumers' borders The success of this brand tells us that on every road, innovative people who "dare to think" in new directions, dare to make the impossible possible, even create a historic turning point

With the brand's development, TH True Milk has launched a wide range of new products Popular brands include dairy products with over 70 fresh milk-based products, such as pasteurized fresh milk, pasteurized yogurt, natural yogurt, and so on Each milk product of TH True Milk carries its own brand In addition to the TH generation of many different butter products, the format includes Mozzarella and laminar Other solds are also available for the use of TH True Milk Juice, TH True Milk Juice, Roasted RICE RICE, and especially the pure refreshments of the TH True Milk Ice cream products were also marketed as cinnamon cream, flavored cream, canned ice cream and finally Japonica FVF rice product with interest in TH True Milk.

In order to produce clean Milk, the TH True Milk company has invested heavily in the production and is divided into three main processes: First, the dairy process must be of

a specific genetic heritage, with a clear pedigree, and avoid inbreeding with renowned dairy countries, such as New Zealand, the United States, Australia, Canada, and

world-so on And then a dairy cow This was the key to creating the purest and fresh milk stream modern technology that put dairy cows' health first Using a closed milk vaccine process, the system will automatically refuse to receive fun nutritionally guaranteed milk The milk production process after the vaccine is cooled at 2-4 °C and is quickly transferred to a clean milk processing plant, TH, to maintain the complete quality, leaving the milk uncontaminated The TH True Milk, pure, delicious, nutritious, fresh milk from the ultimate technological base The division process of the TH True Mart system has been built to ensure that the TH product chain is in the safe condition through end-to-end delivery service

2.1.2 Overview of Cengage VN, UEH University and Hong Duc Publishing House

A collaboration between Cengage VN, department of Economics at the Ho Chi Minh City University of Economics UEH and Hong Duc publishers access quickly knowledge to support the learning process as well as self-study by the students and minimize the cost of creating a new macroeconomics book This collaboration has resulted

in the exchange of academic documents and information, exchange of instructors and researchers, student exchange, co-organizing symposia, scientific research cooperation and other collaborative activities with the aim of exchanging and supporting each other It is open to the possibility of developing the faculty for scientific research and to increase the number of scientific articles published in international journals in the near future

N Gregory Mankiw, professor of economics at Harvard University, wrote many articles and was frequently involved in projects of economic and academic policy debate

As one of the world's 25 best-known economists, his economic work has been used by many universities around the world He is also the author of Worth Press In addition to teaching, research, and writing, Mankiw works as a researcher for the National Council of Economic Research, as a consultant to the Office of The Budget of Congress and the Federal Reserve Of Boston, and the Board of Development and Testing of Members of ETS in New York - a pre-university course in economics This is the first time that N Gregory Mankiw's economic work was translated into Vietnamese and published in Vietnam The text of the book contains the most general, broad explanations of economic concepts, macroeconomics, and economic governance mechanisms 16 textbooks give the reader comprehensive and intensive knowledge of economic principles such as classical theories; development theory: long-term economy; theories in economics: a short-term economy; Interpretation and assessment of science professor The definition of the concept

in the book is clear, easy to grasp, easy to understand, there is a summary of the associated chapter that creates the best conditions for review, providing knowledge from the basics to the advanced, making it easier for students to supply lessons to lessons, how to handle situations in practice The University of Economics TP HCMC and other Vietnamese universities within the Economic and Administration have updated capabilities to match the curriculum of economics

2.2 The procedure for determining the HS code

After selecting products from the supermarket, team members had 1-2 days to study before we discussed the group online As a result, we agreed to choose two products from two distinct industry areas (F&B and education) to identify their HS codes

self-There are three ways to search for and recognize HS codes:

• Method 1: Look up the General Department of Vietnam Customs website at

https://www.customs.gov.vn/ This webpage is exclusively used for reference purposes by my group

• Method 2: Research the program and the websites of firms that support it We did not choose this method since it is expensive, and we are worried about making mistakes the first time we try it

• Method 3: Examine the file Vietnam's import and export tax schedule 2021 -

TTWTO VCCI - Biểu thuế xuất nhập khẩu Vißt Nam năm 2021 My group chose this third option to serve our complete analytical method because it is simple to detect and identify