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HS codes

Origin and trade agreements

Cross-border shipping and customs terms

Plain definitions of the customs, tax and shipping terms cross-border sellers meet, from ad valorem duty to wholly obtained, with links to the full guides.

Updated · 15 official sources

Cross-border trade has its own vocabulary: the codes, duties, documents and trade terms that decide what a parcel pays and who pays it. This page defines each one in a sentence or two, in alphabetical order, and links to the guide that explains it in full. The shortest versions of the core terms are also in our glossary, and the US tariff changes and de minimis guides cover the 2026 changes in full.

Rules as of 30 October 2026.

Cross-border terms from A to Z#

The table lists the terms sellers meet most on quotes, invoices, declarations and carrier bills, from ad valorem duty to wholly obtained. Each definition is short on purpose: follow the link for the rules, the numbers and the worked examples, and check the date at the top, because several of these rules moved in the last two years.

Term What it means
Ad valorem duty A duty charged as a percentage of the customs value. A specific duty charges an amount per unit or weight instead, and a compound duty combines both. See duty.
Air waybill (AWB) The transport document for goods sent by air, issued by or for the airline. See air waybill vs bill of lading.
Anti-dumping and countervailing duties (AD/CVD) Extra duties on specific products from specific countries, and sometimes specific makers, that offset dumping or foreign subsidies. They come on top of the regular rate. See AD/CVD in the US.
Bill of lading The transport document for goods sent by sea, issued by the carrier as its receipt for the goods. See air waybill vs bill of lading.
Binding ruling A written decision by a customs authority on how a specific product is classified, which it then applies to that product. US rulings are issued under 19 CFR Part 177 and published in CBP's CROSS database.
Certificate of origin A document stating where goods were made, usually issued by a chamber of commerce in the exporting country. See certificates of origin.
CIF (Cost, Insurance and Freight) An Incoterms rule for sea transport, in which the seller pays the freight and insurance to the destination port.
CN code The EU's 8-digit Combined Nomenclature code: the 6-digit HS code plus two EU digits that set the common customs tariff. See HS codes.
Commercial invoice The seller's invoice for the goods, which customs use to check what they are, what they cost and where they were made. See commercial invoices.
Country of origin The country where goods were wholly obtained or last substantially transformed, not where they shipped from. See country of origin and the glossary entry.
CPSC eFiling The US requirement, in force since 8 July 2026, to file certificate data electronically when consumer products regulated by CPSC are imported. See CPSC.
Customs broker An agent who prepares and files customs entries, and often pays the duty, on an importer's behalf. See customs clearance.
Customs union A group of countries that form one customs territory with a common external tariff, such as the EU. See trade agreements.
Customs value The value duty is worked out on, usually the price paid for the goods. The EU and the UK add transport and insurance to the border; the US and Canada leave international freight out. See landed cost.
DAP (Delivered at Place) An Incoterms rule in which the seller delivers to a named place and the buyer handles import clearance and pays the duty and taxes. See DDP.
DDP (Delivered Duty Paid) An Incoterms rule in which the seller handles import clearance and pays the duty and taxes, so the buyer pays nothing on delivery. See DDP.
De minimis The value below which a country charges no duty, no import tax, or neither. The US suspended its $800 exemption indefinitely by CBP rules of 24 June 2026. See de minimis and the glossary entry.
DPU (Delivered at Place Unloaded) An Incoterms rule, formerly called DAT, in which the seller delivers the goods unloaded at a named place.
Duty A tax on imported goods, set by the tariff line for the product's code and origin. See duty calculation and the glossary entry.
Duty drawback A refund of duty paid on imported goods that are later exported, under conditions the importing country sets.
EEI (Electronic Export Information) US export data filed through the Automated Export System. It's generally not needed where each Schedule B or HTS line in a shipment is worth $2,500 or less, with exceptions. See US export documents.
EORI number The ID businesses use for customs in the EU and the UK. UK numbers start with GB for Great Britain and XI for Northern Ireland. See EORI.
FCA (Free Carrier) An Incoterms rule in which the seller hands the goods to the buyer's carrier at a named place.
Formal and informal entry (US) The two kinds of US customs entry. Informal entry is available for most shipments worth $2,500 or less; larger and some regulated shipments need a formal entry. See the US entry process.
General Rules of Interpretation (GRI) The six rules, applied in order, that decide which heading and subheading of the HS a product belongs to. See general rules.
HS code The 6-digit product code from the WCO's Harmonized System, the base of most countries' tariffs. See HS codes and the glossary entry.
HS edition A version of the Harmonized System. HS 2022 is in force; HS 2028 enters into force on 1 January 2028. See HS editions.
HTS code The US 10-digit tariff code: 6 HS digits, 2 digits that set the duty and 2 statistical digits. See the glossary entry.
ICS2 The EU's advance cargo information system, through which safety and security data on goods is filed before they arrive. See ICS2.
IEEPA The International Emergency Economic Powers Act. On 20 February 2026 the US Supreme Court held in Learning Resources v. Trump that it doesn't authorize the President to impose tariffs. See US tariff changes.
Import VAT and GST Consumption tax charged on imports at the destination's rate, usually on the customs value plus duty. See VAT, GST and sales tax.
Importer of record The party responsible for an import entry. In the US it has to use reasonable care to enter, classify and value the goods.
Incoterms The International Chamber of Commerce's 11 three-letter trade terms that set who pays for and handles transport, insurance and customs. The current set, Incoterms 2020, took effect on 1 January 2020.
IOSS (Import One-Stop Shop) The EU scheme that lets a registered seller charge import VAT at checkout on low-value goods sent to EU consumers and declare it monthly in one member state. See EU VAT.
Landed cost The full cost of getting goods to the buyer: price, shipping and insurance, plus duty, import taxes and fees. See landed cost and the glossary entry.
Low-value consignment duty (EU) The EU's temporary €3 customs duty per tariff classification on parcels worth up to €150, from 1 July 2026 to 1 July 2028. See the EU's €3 duty.
Merchandise processing fee (MPF) A US CBP fee on import entries. A USMCA preference claim includes an exemption from it.
MFN rate The regular duty rate a WTO member applies to goods from other members when no preference applies.
Preferential origin Origin that qualifies goods for a lower rate under a trade agreement, when they meet its rules of origin and the importer has proof. See trade agreements.
Pro forma invoice An invoice issued before a sale is final, or for goods that aren't being sold, such as samples. The invoice generator makes both kinds.
REX (Registered Exporter system) The EU's register of exporters who can make statements on origin. Registration is needed for shipments of originating goods worth more than €6,000.
Rules of origin The conditions goods must meet to count as originating in a country, for ordinary duty or for a trade agreement. See country of origin.
Schedule B The US export commodity code, maintained by the Census Bureau and used in export filings.
Section 232 US additional duties under Section 232, which in 2026 cover goods such as steel, aluminum and copper and products made from them. See Section 232.
Section 301 US additional duties under Section 301, aimed at the goods of specific countries. See Section 301.
Section 321 The US de minimis provision for shipments worth $800 or less. CBP suspended it indefinitely by rules published on 24 June 2026, for mail from 24 July 2026. See the glossary entry.
Statement on origin A declaration of origin the exporter writes on the invoice under EU and some other trade agreements, in place of a certificate. See certificates of origin.
Substantial transformation Processing that turns goods into a new and different article, which moves their origin to the country where it happened.
TARIC code The EU's 10-digit integrated tariff code, which adds EU measures such as anti-dumping duties, quotas and suspensions to the CN code.
Tariff A country's schedule of duty rates by product code, and often the duty itself.
USMCA The United States-Mexico-Canada Agreement. US importers claim it by putting "S" or "S+" before the HTS subheading. See USMCA.
Wholly obtained Goods produced entirely in one country, such as crops grown or minerals mined there, which always originate in that country.

Common questions#

What is the difference between DDP and DAP?#

Under DDP the seller pays the import duty and taxes and handles clearance; under DAP the buyer does, usually when the parcel is delivered. Both are Incoterms rules from the International Chamber of Commerce.

Is de minimis the same in every country?#

No. Each country sets its own threshold, some for duty only and some for duty and tax, and the US suspended its $800 exemption indefinitely in 2026.

What is the difference between an HS code and an HTS code?#

An HS code is the 6-digit international code. An HTS code is the US 10-digit code built on it, with two digits that set the duty and two for statistics.

Sources#