of tariff and product classification

As an international company, you will be more than familiar with the challenges of tariff and product classification. All products that you procure or sell internationally must be classified in accordance with the different customs tariffs and checked against the various import and export regulations,

whereby tariff classification is not only necessary for imports and exports to and from third countries, but is also required in intra-Community trade for the creation of an Intrastat declaration or as part of a preference calculation.

However, it is not only correct tariff classification that is necessary to ensure quick and easy handling by customs offices – an informative customs goods description, preferably in the relevant local language, is also a key prerequisite.

Valid and informative foreign trade master data is therefore essential for the legally compliant, reliable and rapid handling of your shipments.

The right software
is key to successfull automation

“Time-consuming and error-prone”
Tariff and product classification activities have always been labour-intensive, time-consuming activities carried out manually, which, if carried out incorrectly or non-transparently, can result in hefty fines or even criminal charges for the employee in question and their company. In particular, the dreaded organisational failure, i.e. a company breaching its organisation obligations, can have drastic consequences for the company, because in addition to financial penalties, it can also lead to loss of procedural simplifications and approvals.

“Customs are noticeably tightening the reins”
With the ongoing digitisation of customs authorities and continuing tensions in international trade, the requirements of customs authorities vis-à-vis tariff and product classification and a generally understandable goods description for products have become considerably more stringent.

Where less rigorous goods descriptions, such as technical product names or tariff text excerpts, were tolerated in the past, customs offices are noticeably tightening the reins. Customs declarations are increasingly being rejected on account of inadequate goods descriptions, which leads to additional outlay and unscheduled idle time in the logistics chain.

Many companies are faced with a completely new, critical challenge here, one that takes up a great deal of time and resources – yet it is imperative companies overcome it in order to satisfy the relevant legal requirements.

The right software is key
What if most of these tasks could be automated and simplified? If there were a software that could automate tariff and product classification activities, and – in those cases where automation is not possible – effectively support users with their tariff and product classification work, and thereby reduce the number of erroneous decisions? What would it be like if this software could also generate individual customs goods description for each of your products, and thereby satisfy stringent customs laws? What if this software could also log and identify any anomalies and significantly reduce the risk of organisational failure through definable work processes and test criteria?

Unsurprisingly, the requirements for a software solution that automates and simplifies tariff and product classifications are high. It must be generic enough to map a wide variety of product groups comprising a wide variety of products, while the results it provides would need to be transparent and comprehensible enough to stand up against any questions posed by the authorities in a foreign trade or customs audit. In particular in the case of companies that use SAP GTS, a material master comprising several hundred thousand or even millions of materials is not uncommon. Each of these products therefore needs to be examined and processed accordingly, which places high demands on the performance of such software.

The solution
Classification Suite for SAP GTS


quick and easy installation of the certified software


simplified tariff and product classification


detailed logging of all decisions and changes

To respond to these major, complex challenges, mformatics GmbH – a consulting firm based in Walldorf, Germany and specialising in foreign trade with SAP GTS – has developed Classification Suite, a certified add- on for SAP GTS that not only considerably simplifies, but also automates tariff and product classification activities.

Classification Suite adopts such a generic approach that the diversity of your existing product master data and your very individual product un- derstanding can be mapped perfectly in the system and used as a basis for tariff and product classifications.

While general regulations, such as the German Federal Office for Economic Affairs and Export Control’s (BAFA) ‘Correlation List’, are intended for manual recommendations and manual user support, more specific, detailed regulations can also be used for full automation. The decision here is always down to your department and can be changed at any time.

A combination of generally valid deductions, your individual regulations (which reflect your company-specific product know-how) and the option of integrating machine learning and artificial intelligence techniques in Classification Suite facilitates the rapid creation of a comprehensive decision matrix for simple, secure and even automated processing.

Not only can Classification Suite assign your products a wide variety of international tariff and product classifications and check existing decisions, it can also generate informative customs goods descriptions in any number of languages and country versions at the same time and make them instantly available for the customs declaration created in SAP GTS.

Using sophisticated logging mechanisms, Classification Suite documents in detail its own decisions and automatic changes and also logs the interaction between user and software, making it is possible to see exactly what information was available to the user at the time of the tariff and/ or product classification and whether they successfully leveraged this information for correct classification. This makes it easy to identify and check any unusual decisions made by a user or any tariff and/or product classification-related changes to the material master.

As Classification Suite can be installed in your SAP GTS system without the need for any modifications, third-party services, software components or cloud access rights, it can also be implemented in even very complex system structures quickly and easily, and in standardised form.

This direct installation of the SAP-certified software component in your SAP GTS system and the direct use of your existing master data not only facilitates the fast and seamless technical integration of the solution, but also enables your users to work quickly and easily with the solution, as you already have the relevant system access and are familiar with the user interfaces and as Classification Suite seamlessly adopts your existing and proven authorisation concept. All your data remains in your system and is protected by your existing data protection mechanisms. Classification Suite is, of course, also available in your complete existing system landscape (i.e. your development, test and production systems), which will also enable simple, risk-free training of new employees in the future.

Classification Suite is therefore the logical choice for companies already using SAP GTS and looking to simplify and improve their tariff and/or product classification activities or the customs goods description of their products.

Highlights of
Classification Suite

  • SAP-tested & certified add-on
  • Automated tariff and product classification for your products
  • Generation of the customs goods description of your products in any number of languages
  • Detailed logging of all decisions made by Classification Suite and your employees
  • Quick and easy maintenance and updating of your own regulations
  • Targeted search for conspicuous or unusual decisions
  • Systematic checking of existing tariff & product classifications
  • Import of third-party or generated regulations, such as the BAFA Correlation List
  • No additional third-party software or data transfer to third-party systems
  • Direct use of your existing and proven authorisation concepts
  • Familiar, tired-and-tested user interfaces enable rapid training of your employees