General Rules of Interpretation – Customs Tariff – Harmonized System
The GRI’s instruct users to a single classification number that is appropriate for each product – they explain how to classify.
There are 6 GRI’s, and they must be applied systematically in order.
GRI rule 1
If a commodity is specifically named in a heading, you must use that heading in order to classify your good.
• GRI 1 has precedence
• Rules 2 through 4 apply ONLY if goods cannot be classified by the application of GRI 1
GRI rule 2(a)
Use rule 2(a) to classify incomplete/unfinished and unassembled/disassembled goods.
They must have the essential character of the complete or finished article. E.g.
“Blanks” are considered an article not ready for direct use, having the approximate shape or outline of the finished article or part, and which can be used only for completion into the finished article or part.
GRI rule 2(b)
The classification of goods consisting of more than one material or substance shall be according to the principles of Rule 3.
Therefore, if you have a mixture or combination immediately go to GRI 3.
An example of when to apply GRI 2(b) would be Grass Seed of heading 12.09 that was treated with a fast grow fertilizer.
GRI rule 3
Resolves the potential for classification disputes or gridlock when you have a commodity that can be classified under two or more headings of the HS. By applying the principles governing GRI 3 the matter can be resolved in three ways – by:
3 (a) Employing the most specific description
3 (b) Classifying according to essential character
3 (c) Using the last heading in numerical order
The criteria must be applied in the order presented
GRI rule 3(a) – more specific heading
• Applied to goods which are not multifunctional nor composed of more than one material or substance, when the goods are classifiable under two or more headings
• Gives priority to the heading with the more/most specific description
Example – classification of electric shavers
85.09 Electro-mechanical domestic appliances, with self-contained motor
85.10 Shavers and hair clippers, with self-contained electric motors
85.10 would be correct as the most specific.
GRI Rule 3(b) – Essential Character
- More than one heading could apply
- The headings are equally specific; and
- The goods are:
• a mixture,
• composed of different materials,
• made up of different components, or
• presented in sets put up for retail sale.
Essential character is subjective. It may be based on, for example:
• the nature of the material or components
• their volume, quantity, weight, quality, & value
• their relative importance with regard to end use
• Legal notes
Example – Where would you classify a Pre-packaged spaghetti dinner if it consisted of the following?
• A package of uncooked spaghetti (heading 19.02)
• A pouch of grated cheese (heading 04.06)
• And a can of tomato sauce (heading 21.03)
Answer: The essential character of Pre-packaged spaghetti dinner would be derived from the package of uncooked spaghetti, of heading 19.02
Exception to GRI 3(b) – Gift baskets or boxes that contain a variety of products.
If any one of these commodities falls under the TRQ regime, such as: cheese or cheese products, wheat or barley products, GRI 3(b) will not apply, and every product identified in the basket or box will have to be rated & classified under their own respective headings.
*A common mistake is to assume a set must be classified using essential character, GRI 3(b), however, some sets are provided for in the terms of the heading and therefore GRI 1 would apply.
Example : Tariff item 8206.00 Provides for Tools put up in sets for retail sale
Example : Tariff item 8215.20.10 provides for “Other sets of assorted articles”
GRI Rule 3(c) – Last Heading
When goods cannot be classified by reference to Rule 3 (a) or 3 (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.
• Applied when classification cannot be resolved by GRI 3(a) or 3(b)
• Simply gives priority to the heading
last in numerical order
last in numerical order
• Reflects the general structure of the Nomenclature (i.e., advancing complexity)
GRI 3(c) Example
An axe and saw are packaged together as a set for retail sale.
82.01 … axes …
8201.40 – Axes … and similar hewing tools
82.02 Hand saws…..
8202.10 – Hand saws…
• Headings are equally specific
• Neither provides set its essential character
• Classified under heading 82.02 – last in numerical order
GRI Rule 4
Goods which cannot be classified in accordance with GRI 1, GRI 2(a) & (b), GRI 3(a), (b) or [c], shall be classified under the heading appropriate to the goods to which they are Most akin, (Similar to)
- Applied only if rules 1 to 3 cannot not resolve the classification
- The goods are not provided for anywhere else in the Nomenclature, including any of the residual headings.
- Very rarely used; if ever
- If ever used, would be based on a comparison to similar goods, taking into account factors such as:
description character purpose
- Exists only to ensure the GRI’s are exhaustive
(i.e., that even something never before known or considered could be classified)
GRI Rule 5
In addition to the foregoing provisions, the following Rules shall apply in respect of the goods referred to therein:
(a) Camera cases, musical instrument cases, gun cases, drawing instrument cases, necklace cases and similar containers, specially shaped or fitted to contain a specific article or set of articles, suitable for long-term use and presented with the articles for which they are intended, shall be classified with such articles when of a kind normally sold therewith. This Rule does not, however, apply to containers which give the whole its essential character.
GRI Rule 5(a)
This rule applies to Cases / Containers
• specially shaped or fitted for the article
• suitable for long-term use
• presented with the article; and
• of a kind normally sold therewith that do not themselves give the whole its essential character.
GRI Rule 5(b)
(b) Subject to the provisions of Rule 5 (a), packing materials and packing containers presented with the goods therein shall be classified with the goods if they are of a kind normally used for packing such goods. However, this provision is not binding when such packing materials or packing containers are clearly suitable for repetitive use.
Covers packing materials and containers:
• Presented with goods
• Of a kind normally used for packing such goods
• Not suitable for repetitive use
ü Collar and backing inserts in men’s shirts
ü Plastic bags containing chips, candies, etc.
X Liquefied gas container filled with gas (Suitable for repetitive use)
GRI Rule 6
All the preceding rules apply to the Sub-Heading Level.
If you enjoyed this post why not subscribe via RSS or join my email newsletter here -> Subscribe