Smells fishy

For most, 1604.20.20.00 does not mean much.
For others, the words "Gefilte Fish" also brings about glossed over stares.
In the world of the Harmonized System (HS) nomenclature for Canada Customs, they mean the exact same thing.
Looking at the US Customs and Border Protection (USCBP) Harmonized Tariff Schedule (HTS), it does indeed list 1604.20.20.00 but for USCBP this code does not define Gefilte Fish.

There are several interesting aspects to the above:
- What is Gefilte Fish?
- Why does the 10 digit code for Canada not define the same thing for the US and vice versa?
- Over 70% of Canadian trade takes place with our Southerly neighbors. Yet, both have their own individual Customs authority with different rules and regulations. How can a company keep track of both sets of rules?

Firstly, I very much enjoy gefilte fish.
Gefilte fish is like a fish pate. It is made from deboned ground fish like pike, whitefish, carp and cod mixed with some sugar, salt and pepper along with finely grated onions and carrots. 
The dish is usually enjoyed with horseradish.

The reason I bring this up is that during my Canada Customs professional examination, one of the classification questions posed was to classify Gefilte Fish!!! For me, that was not so difficult as I know the tariff and was able to quickly identify that the product is actually listed by name in the Canadian nomenclature. This would follow The General Rule of Interpretation (GRI) Rule # 1.
As I was leaving the examination hall with the other test takers, it was amusing to hear so many ask each other, "Do you know what Gefilte Fish is?"

Some things to keep in mind about classification...
1) The first six digits of a classification code is usually consistent with all countries that are members of the World Customs Organization (WCO). However, because a jurisdiction may have a precedent setting ruling issued by the courts, that decision supersedes any rules provided by the WCO in that specific jurisdiction.
As an example...
I had a case where a US vendor obtain a Binding Ruling for Classification from USCBP and was issued with one HTS code.
This vendor shipped the product to a Canadian company and the Canadian company declared the product based on the information provided by the vendor. Basically, the first six digits of the HS code used for the Canada Border Services Agency (CBSA) declaration matched the first six digits of the US Customs ruling.
The Canadian importer underwent a Customs audit in Canada and the findings were that the product was to be classified in an entirely different heading (i.e.: first four digits did not match the US Customs ruling).
A lesson to be learned that although reliance and due diligence can be done using information from US Customs, that information is not binding in Canada and can be overturned by CBSA if they feel required.

2) A ten digit code in one Customs jurisdiction can define one product and in another jurisdiction, that same 10 digit code will define a different product. (See very first paragraph above in this BLOG.)

3) HS/HTS classification is both a science and an art. Specialists take years to master how to accurately classify products and even then, Customs can overturn the classification based on other information that has been identified.

4) The same product being imported into the same jurisdiction can potentially be classified with more than one HS code. I have been privy to a case where CBSA issued two rulings for the exact same item with two different codes. This is very rare and in the case just noted, CBSA did retract one ruling, but it is possible.

5) Companies requiring information about the HS codes for their products (which is any company importing and exporting) should consult with experts, whether those experts are internal team members or external third party consultants. You know your business and your product but at times (and I would venture to say more often than not) you may not have a good grasp of the HS classification nomenclature. Allow experts to assist you with that part of your business. It probably will have costs associated with it, but those costs (I dare say) would be less than the costs of correcting entries after an audit and having to pay duty assessments and penalties for non-compliance.

6) An item may look similar and have a very similar description as that of another item but their classifications could be very different. Many aspects of the item needs to be taking into consideration like composition and use to start to name a few.
See the fish balls recipe below. What happens if the proportion of ground fish to breadcrumbs is inverted where there is more breadcrumbs by weight than ground fish? Does this change the classification of the product?


It's not if Customs comes to audit but when they will be coming.
A good practice is to try to make sure that there is nothing fishy with the declarations made so that Customs does not think that something smells fishy with the overall compliance of the importer.


My feeble attempt to make spicy fish balls.
Very similar to Gefilte Fish with respect to the texture but I was going for incorporating a bit of a kick by adding some sweet chili sauce to the recipe.

Fish Balls Recipe
- 0.5 kg of ground fish (cod, whitefish, pike, carp) -- I bought the fish already deboned and ground from a local market. 
- 1 cup of breadcrumbs
- 2 cloves of finely diced garlic
- 1 diced green onion 
- 1 tablespoon of corn starch
- 1 tablespoon of flour
- 2 eggs
- 3 medium finely grated carrots
- tablespoon of ground ginger
- pinch of cilantro
- sprinkle of dried parsley flakes
- 500 ml of sweet chili sauce
- salt and pepper to taste
- 4 tablespoons of vegetable oil

Directions
- In a large bowl add the ground fish, breadcrumbs, garlic, green onion, corn starch, flour, eggs, carrots, ginger, cilantro, and parsley flakes
- Mix all the ingredients
- Add half of the the sweet chili sauce and mix thoroughly
- Add salt and pepper 
- Prepare the fish balls from the mix
- Use a medium to large skillet and add 2 tablespoons of the vegetable oil. 
- Once the oils is sizzling, place the balls into the skillet and allow to brown on one side (usually about 3 to 5 minutes) and then turn to another side for another 5 minutes. Keep a close eye so that the balls do not burn.
- Remove from skillet
- Prepare a lasagna tray and add the other two tablespoons of vegetable oil. Grease the bottom and sides of the tray.
- Place the fish balls in the tray and pour the other half of the sweet chili sauce all over the fish balls.
- Bake at 350 degrees Fahrenheit for about 35 minutes.
- Allow to cool and serve
- Makes 3 to 4 servings (about 4 fish balls per serving).
I did not make a dipping sauce as I used the sweet chili sauce in the recipe.

Location: Montreal, QC, Canada

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