How to Ensure Accurate HS Code Classification to Avoid Customs Penalties?

The wrong HS code can cost you more than just a few percentage points—it can trigger delays, audits, and even fines. Misclassification is one of the easiest ways to lose trust with customs.

To avoid customs penalties, businesses must classify products using the correct Harmonized System (HS) code based on material, function, and construction—supported by clear documentation and consistent declarations.

At AceAccessory, we’ve helped clients correctly classify everything from resin hair clips to mixed-material belts—avoiding duty errors and customs scrutiny.

What is the penalty for using the wrong HS code?

Misclassifying a product might seem minor—until customs notices and reclassification fees arrive.

Using the wrong HS code can result in financial penalties, shipment delays, retroactive duties, and loss of trusted trader status with customs authorities.

Common penalties for wrong HS codes:

In the U.S., Customs and Border Protection (CBP) enforces fines under the False Claims Act for consistent misclassification. In the EU, you may lose Authorized Economic Operator (AEO) benefits.

That’s why we always double-check classification before goods are loaded, not after they land.

How to find the correct HS code?

Choosing the right code starts with knowing your product—down to its material, function, and construction.

To find the correct HS code, you must analyze the item’s physical properties, consult official customs databases, and compare multiple classifications before deciding.

Steps to identify the right HS code:

1. Break down the product

   • What is it made of? (metal, plastic, fabric)
   • What is its function? (fastening, covering, decoration)
   • How is it used? (personal wear, industrial, medical)

2. Search databases

   • Use national tariff lookups:
     • US HTS
     • EU TARIC
     • WCO Harmonized System

3. Compare options

   • Does the item fall under accessories (chapter 62), plastics (chapter 39), or metal parts (chapter 83)?

4. Check duty and compliance notes

   • Some codes require CITES, REACH, or origin declarations

5. Request binding ruling (if unsure)

   • Many customs authorities offer this service for free

We use WCO tools and our customs broker network to verify the best-fit code—and apply consistent coding across bulk orders.

Who is responsible for correct HS code?

Even if your supplier wrote the code on the invoice, you're still on the hook.

The importer of record is ultimately responsible for ensuring the HS code is correct, even if it was provided by the supplier, freight forwarder, or agent.

HS code responsibility in the supply chain:

At AceAccessory, we support clients by:

• Pre-filling invoices with suggested HS codes
• Matching codes to material declarations
• Sharing prior successful classifications

But we always advise clients to confirm with their own broker or customs authority—especially if importing under DDP or into a high-risk category (e.g., leather goods or synthetic plastics).

How to classify a HS code?

It’s more science than guesswork—and it requires precise reading of tariff schedules.

To classify an HS code accurately, analyze the product using the General Rules of Interpretation (GRI), consider its essential character, and assign the code down to 6-digit, 8-digit, or 10-digit level as needed.

Classification example: Resin Hair Clip

If the same clip has a metal spring core, we evaluate:

• % of weight
• % of cost
• % of surface area
• What gives it its “character”?

If plastic dominates, it stays under Chapter 39. If not, it may fall under Chapter 83 (miscellaneous metal articles).

We often run side-by-side comparisons to ensure customs won’t challenge the classification.

Conclusion

HS code classification isn’t optional—and it’s not a guessing game. It’s a legal responsibility. At AceAccessory, we classify every product with care, logic, and backup—so your accessories move through customs without risk or delay.