Imagine a cargo ship loaded with plastic waste docking at a port, yet its customs declaration fails to accurately classify whether the shipment contains recyclable resources or trash awaiting disposal. This common scenario not only hampers customs oversight but obstructs the effective advancement of circular economy initiatives. The World Customs Organization (WCO) is addressing this challenge by exploring how to refine Harmonized System (HS) codes to better reflect the lifecycle of foundational materials like plastics, metals, and wood.
WCO's Call for Urgent HS Code Reform
On December 1, 2022, with EU support, WCO hosted its fourth thematic workshop titled "Visualizing a Greener HS to Support Environmentally Sustainable Trade." The event brought together HS users from international organizations, private sector representatives, civil society groups, and customs administrations to examine HS's role in tracking the transition toward circular economic models.
Konstantinos Kaiopoulos, WCO's Director of Tariff and Trade Affairs, emphasized in his opening remarks that current economic and consumption patterns have become unsustainable. He stressed that WCO tools—particularly the HS—must evolve to address environmental concerns, noting a critical gap: the system currently doesn't distinguish between virgin and recycled materials or identify waste suitable for recycling operations.
Gael Grooby, TTA Deputy Director, moderated panel discussions focused on tracking materials through their lifecycle stages. She highlighted how enhanced HS visibility could help governments implement environmental policies supporting circular economy transitions.
Expert Recommendations for Sector-Specific Solutions
Plastics: Enhancing Transparency to Combat Pollution
Dr. Carolyn Deere Birkbeck of the Trade, Environment and Sustainability Forum presented findings on HS codes and plastic pollution. She identified shortcomings in tracking cross-border plastic waste flows and proposed refining HS classifications to differentiate plastic types, origins, and disposal methods. Her recommendations included strengthening international cooperation to combat illegal plastic waste trade.
Building Circular Economy Metrics
Arturo de la Fuente from Eurostat demonstrated how HS codes can form the backbone of circular economy statistics. His team developed indicators measuring resource efficiency, waste generation, and recycling rates—providing policymakers with crucial data for decision-making. He advocated for standardized international metrics to enable cross-country comparisons.
Wood Products: Lifecycle Tracking for Sustainability
FAO forestry experts Iana Arkhipova and Ashley Steel analyzed challenges in classifying wood products through HS codes. They recommended distinguishing between virgin and recycled wood products while emphasizing the importance of robust certification systems to ensure sustainable sourcing.
Advancing Plastic and Metal Recycling
Chaim Waibel from the European Plastics Recyclers Association called for more granular HS codes to identify polymer types in waste streams, suggesting certification systems to enable closed-loop plastic recycling. Ross Bartley of the Bureau of International Recycling highlighted metals' climate mitigation potential, proposing new HS codes to differentiate between waste and scrap metal to facilitate recycling.
Toward a Sustainable Trade Framework
The workshop concluded with consensus on the need for HS reforms that better reflect environmental impacts and support circular economy principles. Participants emphasized that achieving this vision requires collaboration across customs authorities, industries, and environmental policymakers to create a truly green HS system.