Sri Lanka gains top slot at World Customs
HS Code expert shines at global session
At a time when Sri Lanka is being castigated by the UN and the
international community for human rights violations, a Sri Lankan being
appointed to a prestigious position like the World Customs Organisation
is indeed an admirable feat. At this juncture it comes as a wake- up
call that Sri Lanka is still in the bidding and is recognised for its
Sri Lanka Customs Director General Jagath P Wijeweera garlanding
Tharaka Seneviratne on his return to the country following the
A Sri Lankan was appointed to top office in a global body. This is
considered a remarkable feat achieved by a Sri Lankan
in recent history in the customs field. Sri Lanka Customs Director
Tharaka Seneviratne was elected Chairman of the Harmonised Systems
Committee of the World Customs Organisation(WCO) on March 13th during
its 52nd session held at WCO Headquarters in Brussels, Belgium. He is
the first Asian to be elected to such a high position among a membership
of 179 countries. The WCO is only second to the United Nations.
Tharaka Seneviratne is the Director of the Sri Lanka Customs Policy,
Planning and Research having a service record of 38 years was proposed
to the slot by the representatives of the European Union. He was
seconded by the Australian representative. The other contenders were an
American national representing the USA who did not even come forward
once Seneviratne was nominated, considering his long- standing
experience and expertise in HS Codding as well as his reputation for
unbiased and impartial nature of handling matters and dealing with
With his return to the country last week following the appointment,
the Sunday Observer spoke to Tharaka Seneviratne who spoke in detail
about the Harmonised Systems Committee and its connection to the WCO.
The Harmonised Systems committee is appointed to update the
Harmonised Systems Nomenclature or International Convention on
Harmonised Commodity Description and Coding System. Classification of
commodities that are being imported and exported to or from a country is
one of the chief duties of the respective Customs department of that
country which helps them to impose a tariff on the goods.
The Customs Departments world over man borders to monitor the inflow
and outflow of passengers and cargo. While taxation and collecting
revenue on imported and exported goods is still the primary objective of
Customs administrations of the developing countries, collecting imports
and exports statistics is a service common to all Customs
Administrations. A Customs Tariff is used for this purpose.
In any country 'Tariff' contains thousands of lines where each line
assigned for a particular kind of good, the rate of Customs duty
applicable for that particular commodity (merchandise), its unit of
measurement (i.e., kilos, metres, litres, etc.) and a numerical code
assigned for that Tariff Line for purposes of identification. Parliament
decides the tax rate on each commodity and publishes it in the gazette
for the information of the public.
Tharaka Seneviratne after being elected as the Chairperson
Harmonised Systems committee
When goods arrive at the border ,the Customs identifies each
commodity and values it according to the accepted valuation principles,
selects the Tariff Line appropriate for that commodity and calculates
the taxes payable on that commodity as per the tax rate indicated
against that commodity in that Tariff Line. In Sri Lanka this function
is known as Commodity Classification and Appraisement.
A Tariff has to have a list of commodities and taxes specified
against each commodity. The list of commodities has two components. The
list itself and the codes for identification of each commodity or group
of commodities is known as 'Nomenclature.'
Harmonised Coding System
What happens if each Customs administration has its own nomenclature.
At the time of exportation the goods will be classified by the exporting
country (for example, “X”) customs in one particular code: the same
commodity at the importing country (for example “Y”) customs will be
identified by a different code, because that country uses a different
nomenclature. If no smuggling takes place, and all goods come through
Customs, the export trade volume from country “X” to country “Y” should
tally with import trade volumes from country “X” to country “Y”. That
comparison could be made only if both countries are using the same
nomenclature in their tariffs. If individual countries use their own
nomenclatures when goods are moved from one country to the other
overland across several land-locked countries, that classification would
vary from country to country, hindering smooth flow of international
At a very early stage of development as far back as in the 1950s, the
Customs Cooperation Council (Now known as World Customs Organisation)
realised the need to have a common nomenclature that could be accepted
by Customs administrations all over the world. The first nomenclature
that was the result of their combined efforts was known as the Brussels
Tariff Nomenclature (BTN). It used four Arabic numerals and an
alphabetical letter to identify commodities. Subsequently it underwent a
name change and was known as the Customs Cooperation Council
After using the CCCN for a considerable time its users found it
lacking in many aspects, particularly in granularity, which is the
ability to identify individual products rather than large groups of
products. Therefore, they embarked upon a project to design a completely
new nomenclature for customs taxation and statistical purposes. By that
time countries like the United States and Japan were using nomenclatures
showing much more details beyond the scope of CCCN and shipping, air and
overland haulage companies were using their own nomenclatures for
purposes of identifying and charging freight. The new customs
nomenclature embodied all the beneficial aspects of those nomenclatures,
hence was known as the “Harmonized Commodity Description and Coding
System.” It is frequently referred to as the Harmonized System or the
Harmonised System Committee
The Harmonized System Nomenclature was established by International
Convention on June 14, 1983 and the Convention came into force on
January 01, 1988. The HS Convention itself provides the means for
maintaining the HS and disputes settlement. Article-6 of the HS
Convention establishes the “Harmonized System Committee” (HSC) for that
very purpose. The committee convenes twice a year, usually in March and
September at WCO Headquarters in Brussels.
The committee is entrusted with several main duties including
resolving classification disputes between countries, issuing
classification opinions and preparing explanatory notes where necessary.
It is also require to look into the updating of nomenclature to be in
line with technical advances and changes in the trade pattern. To carry
out these duties methodically the HSC is supported by two subcommittees
and a working party. The two subcommittees are Review Committee and
Scientific Committee, Seneviratne explained.
The Review Subcommittee (RSC) is entrusted with the work of reviewing
the HS Nomenclature to keep it current by deleting obsolete Headings and
Subheadings and proposing new Headings and Subheadings to embrace new
products entering the market due to new inventions and technologies. For
example natural animal hair was an important raw material in the past
but it was soon replaced by plastic fibres and filaments which were
cheaper and durable. To be recognized as a Heading in the nomenclature
the commodity should have an annual global market of not less than US$
100 million, likewise the threshold for Subheading level is US$ 50
million. When a product drops below that level the respective Subheading
or the Heading is considered for deletion.
Both the HSC and the RSC are supported by the Scientific Subcommittee
which handles classification of chemicals and disputes of more
scientific nature and makes recommendations. The Working Party working
under the HSC looks into various documentation aspects and submits
working documents to the HSC. Various countries or the WCO Secretariat
itself will make proposals to amend the HS Nomenclature and the RSC will
meet twice annually and discuss and make proposals for amendment. Those
proposals are referred to the HSC for finalization.
While the RSC and the Working Party makes decisions on consensus the
HSC can vote to and takes decisions based on simple majority votes.
Every five years the HSC finalizes all the proposed amendments, embodies
into one single document and submits to the Council Sessions for
approval. At the Council any country can object to any proposed
amendment (totally or partially) in which event the amendment or the
part so objected to will be kept aside and the remainder will be
considered for adoption. Six months after submission to the Council
Sessions if there were no further objections (reservations) the
amendments so finalized will be deemed adopted and the Secretary General
of the WCO will announce the amendment for adoption.
In the most recent HSC Session concluded in March this year the
latest amendments to be implemented in 2017 were finalized for
submission to the Council Sessions in June this year. The Nomenclature
that comes into force in January 2017 will be the fifth edition of the
HS Nomenclature. Presently the HS 2012 edition is in force.
Tharaka Seneviratne was elected as the Chairperson Harmonised Systems
Committee, an American representative and an African representative were
elected as the two Vice Chairs. The Korean Representative was elected as
the Chairperson for Reviews Subcommittee. The Chinese representative was
elected as the Chairperson for Working Party.
Tharaka Seneviratne joined the Customs Department as an Assistant
Superintendent on March 12, 1976. he was progressively promoted to
Superintendent, Assistant Director, Deputy Director and ended up being
Director of Customs.
He was Departmental Specialist Trainer in the HS Domain and Montreal
Protocol. He conducted a large number of training Sessions in those two
areas, for the Customs Staff as well as for the Private Sector
In November 2008, after successfully completing the examination
conducted by the WCO, was selected as a “WCO Accredited Specialist
Trainer in HS.”
In February 2010, conducted a “Capacity Building Session on HS” in
Timor-Leste in collaboration with the WCO.
As the WCO Accredited Regional Resource Person, in November 2012,
conducted a Capacity Building Session on HS in relation to “HS 2012
amendments and Green Customs Initiative” in Male, Maldives in
collaboration with the WCO-ROCB, Bangkok and UNEP.
In June, 2013, conducted a Special Training Session for Customs
Officers of the SAARC Region in connection with the 3rd Training Program
for Mutual Customs Cooperation, under the 9th SAARC Subcommittee.
In March 2010 at the 45th Session of the HSC, elected as the
Chairperson of the Working Party and the 1st Vice Chairperson of the HSC;
accordingly, worked in that capacity at the 46th Session of the HSC
(September 2010), 47th Session(March 2011),