Code Shift: The environmental significance of the 2022 amendments to the Harmonized System

Key Messages

• The World Customs Organization recently released amendments to the Harmonized Commodity Description and Coding System (HS)—essentially, the language of trade. These changes will be implemented by most of the world’s economies on January 1, 2022.
• Many of the changes will facilitate the monitoring of exports and imports of environmentally sensitive products, such as electronic wastes, but also trade in environmental goods, such as solar photovoltaic panels and mass spectrometers.
• This update is a considerable improvement, but the next version of the HS, to be released in 2027, could be further enhanced by creating specific, harmonized codes for a number of goods that will be increasingly important for dealing with the world’s pressing environmental problems.

This paper highlights the environmental significance of recent changes to the Harmonized Commodity Description and Coding System (HS), approved by members of the World Customs Organization in early 2020. These changes, which will go into effect at the beginning of 2022, facilitate the monitoring of trade in both environmentally sensitive products and “environmental goods”— that is, goods that serve an environmental purpose. Notably, this includes new commodity codes specific to several technologies that use solar energy and energy-efficient light-emitting diodes. The brief concludes by discussing a number of goods for which greater specification in the HS would facilitate the negotiation of trade agreements aimed at environmental goods and trade statistics collected on those goods. These insights are highly relevant to specialists working on trade or environmental policy, as well as customs authorities.