Karachi, March 25, 2025 – The Federal Board of Revenue (FBR) has introduced a revised methodology to streamline the resolution of classification disputes in the customs domain.
The newly issued Customs General Order (CGO) No. 02 of 2025 amends and updates the provisions set forth in CGO No. 12 of 2002, which was initially issued on June 15, 2022. This step is aimed at enhancing efficiency and transparency in the classification of goods under the customs framework.
As per the revised methodology, the FBR has outlined a structured approach under section 18E of the Customs Act, 1969, regarding the constitution of a specialized committee or center for resolving classification disputes. The primary responsibility for handling routine classification matters will continue to rest with the respective Customs Collectorates at their operational level. However, in cases where disputes arise, they may be referred to the Classification Centre established at the Collectorate of Customs Appraisement-East, Karachi, with the approval of the relevant Collector or Director.
The Classification Centre will serve as the key authority in determining classification disputes and will perform several critical functions, including:
• Examining and settling classification disputes referred by Customs Collectorates, Directorates, or traders.
• Compiling and publishing classification rulings on an annual basis.
• Maintaining an extensive database of classification rulings, relevant documentation, and related publications.
• Facilitating communication and exchanging information on classification matters with the World Customs Organization (WCO) through the FBR.
• Enhancing capacity building for customs officers and staff in the field of HS classifications in collaboration with the Customs Academy of Pakistan.
The Classification Centre will be managed by a classification committee, which will be responsible for resolving disputes and issuing classification rulings. This committee will comprise three key members: the Collector of Customs Appraisement-East, the Collector of Customs Appraisement-West, and the Collector of Customs, SAPT, Karachi. Additionally, the Additional Collector (Headquarters) of the Collectorate of Customs Appraisement-East, Karachi, will serve as the secretary of the committee. Other officers from different Collectorates and Directorates may be co-opted as needed.
The classification committee will also include one representative from the Federation of Pakistan Chambers of Commerce & Industry (FPCCI) and a member from the relevant trade association linked to the disputed goods. To ensure informed decision-making, the committee may seek opinions from laboratory experts, specialists, or other industry professionals. Meetings of the classification committee will be held at least twice a month, though additional sessions may be convened as necessary. The committee also retains the flexibility to conduct online meetings for greater efficiency.
Upon receiving a request or reference regarding the classification of goods, the committee may consult relevant Collectorates, Directorates, or laboratory units to gather expert opinions. The case will then be presented in a classification committee meeting, where the trader or an authorized representative will be invited to participate. The committee may also request additional documents or information from the trader before finalizing its decision.
In cases where the three committee members—the Collectors of Customs Appraisement-East, Appraisement-West, and SAPT, Karachi—fail to reach a unanimous decision, the majority opinion will prevail. All new classification disputes must be resolved within 120 days of receipt at the Classification Centre, with a possible 30-day extension granted by the Chief Collector of Customs Appraisement-South, Karachi, if necessary. For previously pending cases, decisions must be made within 120 days, but no later than August 31, 2025.
To ensure widespread dissemination, classification rulings will be issued as Public Notices and circulated among traders, customs authorities, and the FBR. Additionally, any local classification committee previously operating within a Collectorate or Directorate will be dissolved, and its pending cases will be transferred to the Classification Centre for expedited resolution.
For smooth operations, the Collectorate of Customs Appraisement-East, Karachi, will provide logistical support, space, and human resources necessary for the efficient functioning of the Classification Centre. The FBR’s new approach to classification disputes reflects its ongoing commitment to improving transparency, consistency, and regulatory compliance within Pakistan’s customs framework.