BY TOBY GOOLEY, CONTRIBUTING EDITOR
GLOBAL TRADE MANAGEMENT
Strategy
Some vendors are incorporating artificial intelligence and machine learning into their global trade
management software. Here’s how these technologies could improve trade compliance and classification.
IF YOU WORK FOR A BUSINESS THAT IMPORTS
products into the U.S., you know how important it is to
correctly describe and declare them to U.S. Customs and
Border Protection (CBP) when they enter the country. For
customs purposes, the product description consists of two
elements. The first is an English-language description of
the product, and sometimes its function or purpose. The
second is the product’s tariff classification in the form of a
numerical identifier.
The correct tariff classification is critical: As its name
suggests, it’s the primary factor in determining which tariffs
apply and the amount of duty you’ll pay. Get it wrong, and
you could end up paying more than you should ... or less
than you should and have to make up the difference later
(and possibly pay a fine to boot). This is no small matter;
for a large importer, a mistake could potentially add up to
millions of dollars in unnecessary expense.
But tariff classification is a complex and difficult process,
and human experts are hard to come by. Classification
errors are common, and tales of epic disagreements between
customs authorities and importers abound. And there’s
a new complication: President Trump’s tit-for-tat trade
war with China has led, often with little advance notice, to
repeated rounds of tariff increases on both sides. It’s more
important than ever to verify that a commodity really is—
or isn’t—subject to those higher duties.
AI and ML come to GTM
