Using AI to classify imports: who is responsible when the code is wrong

Short answer: Yes, an importer may use AI software, a classification vendor or a broker to work out HTS codes; no statute forbids it. The legal duty does not move with the work, though. Under 19 USC 1484, the importer of record must use reasonable care when it files the classification, so if a tool’s code is wrong, CBP looks at the importer’s conduct, and the penalty exposure under 19 USC 1592 depends on what the importer did to check that code.

The confusion comes from three different questions being asked as one, and from CBP’s January 2026 ruling on an AI classification platform being read as an answer to all three. This post separates them, sets out what reasonable care looks like when software proposes the code, and contrasts the export side, where the regulations expressly let exporters classify their own items.

Which three questions do people mix up?

People mix up whether a tool is allowed, whether the tool’s provider is doing licensed work, and who pays when the code is wrong. Each has a different legal source and a different answer.

Question	Where the answer comes from	Answer
May an importer use software to classify its own goods?	No rule prohibits it; 19 USC 1641(b)(1) exempts customs business done solely for oneself from licensing	Yes
Is the tool’s provider conducting customs business?	19 USC 1641 and CBP rulings such as HQ H350722	Depends on the facts: digits, link to an entry, who decides
Who is liable for a wrong code on an entry?	19 USC 1484 (reasonable care) and 19 USC 1592 (penalties)	The importer of record, judged on its own conduct
Who classifies an export for EAR purposes?	15 CFR 732.3	The exporter may self-classify; a BIS ruling is optional

Who is legally responsible for the HTS code?

The importer of record is responsible for the HTS code. 19 USC 1484(a)(1) says the importer of record, in person or through an agent it authorizes in writing, shall “using reasonable care” make entry and complete it by filing “the declared value, classification and rate of duty applicable to the merchandise.” The importer of record is the party eligible to file that entry; usually the owner or purchaser of the goods, or a licensed broker acting with the owner’s authorization.

Nothing in that sentence mentions how the code was produced. A code typed by a junior analyst, copied from a supplier’s invoice, returned by an API or pulled from a vendor’s spreadsheet is the importer’s declaration once it is on the entry. CBP then fixes the final classification at liquidation, and if the declared code was wrong, the question becomes whether the importer was careless in declaring it.

That question is answered under 19 USC 1592, which sets three culpability levels. For negligence, the maximum civil penalty is the lesser of the domestic value of the merchandise or twice the loss of revenue (20% of dutiable value if there is no loss); for gross negligence, the lesser of domestic value or four times the loss (40% if no loss); for fraud, up to domestic value. Section 1592(d) also requires CBP to collect any lost duties even if no penalty is assessed. The point for this post: the level of culpability is assessed on what the importer did, and “the software said so” is a fact about the software, not about the importer’s care.

What does reasonable care look like when a tool is involved?

Reasonable care with a tool looks like reasonable care without one: the importer can show what the product is, why the code fits it, and who checked. CBP’s informed compliance publication on reasonable care frames it as a checklist. On classification it asks whether you have reliable procedures to give CBP a complete description and a correct tariff classification, whether you consulted the tariff schedule, CBP rulings and court decisions, whether you sought a ruling, and whether you consulted a customs expert such as a lawyer, broker or consultant. It also says that if you use an expert, you should have given that person full, complete and accurate information about the goods.

Software fits into that checklist as a research step, and it helps only if its output can be checked. A code with no reasoning attached gives the reviewer nothing to verify. A code that cites the heading text, the section or chapter note, the GRI applied and the rulings relied on gives the reviewer something to agree or disagree with, and gives you a record if CBP sends a Form CF-28 (Request for Information). Reproducibility counts too: if the same product description returns a different code next quarter, your file no longer explains the entry you made. Controls such as sampling rates, review triggers and version records are in governance rules for automated HTS classification, and the documentation CBP tends to ask for is in what CBP expects you to document to show reasonable care on HTS codes.

Worked example: a tool that misses a nomenclature change

Take a hypothetical distributor importing a boxed rapid antigen test: 25 test cassettes carrying antibody-coated strips, extraction buffer and nasal swabs, for use on a sample outside the body. A classification tool proposes heading 3002, reasoning that the active element is an antibody and heading 3002 covers immunological products.

A reviewer who checks the current legal text finds that HS 2022 rewrote heading 3822 to cover prepared diagnostic or laboratory reagents “whether or not put up in the form of kits,” and added Chapter 30 Note 1(ij), which excludes diagnostic reagents of heading 3822 from Chapter 30. The test is not administered to the patient, so subheading 3006.30 does not apply either. The code that goes on the entry is in 3822.19, and the reviewer’s note records the heading text, the note and the HS 2022 change. If CBP later questions the entry, that note is evidence of care; an unexamined 3002 code would have been evidence of reliance on a tool that nobody checked. The full analysis is in classifying diagnostic test kits in 3822, 3002 or 3006.

This is the design point behind TariffWolf’s engine: it is deterministic, so the same question returns the same 6-digit HS code with the same justification, and each result can be exported with reviewer, timestamps, sources and reasoning per SKU. The reasons TariffWolf took AI out of its core classification step are in why we removed AI from our core HS classification engine.

Can you rely on a vendor, broker or supplier code?

You can use a vendor’s, broker’s or supplier’s code, but relying on it does not transfer the importer’s liability. What reliance can do is serve as evidence of care, if the reliance was reasonable: the adviser was qualified, you gave them complete and accurate product facts, and nothing you knew should have told you the code was wrong. Each of those conditions is about your conduct.

A licensed broker’s code: reasonable to rely on when you described the goods fully and the broker had what it needed; less so when the broker classified from a one-line invoice description you never corrected.
A supplier’s code: suppliers often print a tariff number on the invoice, and a foreign supplier’s number is usually built on its own country’s tariff. The first six digits may match yours; the rest are not a US classification, so check the HTSUS line yourself before it goes on an entry.
A software vendor’s code: reasonable to use as a starting point when the output shows its reasoning and someone qualified reviewed it; weak as the only step.
A binding ruling: the strongest form of reliance, for the importer that requested it and for goods matching its description (19 CFR 177.9).

Contract terms do not change this. An indemnity from a vendor may let you recover costs from the vendor afterward, but CBP assesses duty and penalties against the importer of record.

Where do customs business and licensing come in?

Licensing is about the provider, not the importer. Under 19 USC 1641, conducting customs business for others, which includes classification connected to an entry, requires a broker’s license. In HQ H350722 (January 16, 2026), CBP told an unlicensed foreign platform that its AI tool would be conducting customs business if it gave subheadings beyond six digits for goods that will or may be entered. A tool stopping at six digits was not doing customs business, and general classification information disconnected from any actual or intended importation could be permissible if the disclaimer was meaningfully implemented and the tool ran separately from the platform’s broker portal. The ruling does not discuss reasonable care or importer liability. The full reading is in what CBP rulings say about software that assigns HTS codes, and the question of who else needs a license is in does giving someone an HTS code require a customs broker license.

How is the export side different?

On the export side, the regulations put classification on the exporter expressly. 15 CFR 732.3(b) says you should classify your items against the Commerce Control List and may do it on your own, without help from the Bureau of Industry and Security (BIS), and that you have a right to ask BIS for a classification (a CCATS). Asking is optional except in specific cases such as certain encryption items. The same section warns that getting the classification wrong does not relieve you of the obligation to obtain a license when one is required.

So an exporter using software to propose an ECCN (Export Control Classification Number) is in the same liability position as an importer using it for an HTS code: free to use the tool, responsible for the answer. What the EAR lacks is any counterpart to the customs broker license.

Common mistakes when a tool is in the loop

Accepting a code whose reasoning nobody can read, then trying to reconstruct it after a CF-28 arrives.
Feeding the tool a marketing description instead of material, function and how the goods are put up, which is what the headings test.
Running a whole catalog through once and never re-checking after an HTSUS revision or a nomenclature change such as HS 2022.
Treating a vendor disclaimer or indemnity as if it moved the 1484 duty off the importer.

If you suspect past entries carried wrong codes, talk to a licensed customs broker or trade attorney before deciding on a prior disclosure.

Frequently asked questions

Is AI HTS classification legal?

Yes, for an importer classifying its own goods; no law prohibits using software to research HTS codes. The importer of record must still use reasonable care under 19 USC 1484 for the code it files. A separate question is whether a third party providing codes for goods others will enter is conducting customs business that needs a broker’s license.

Who is liable if classification software gives the wrong HTS code?

The importer of record is liable to CBP for the duty owed and for any penalty under 19 USC 1592. The penalty level (negligence, gross negligence or fraud) depends on the importer’s conduct, including whether anyone reviewed the code and on what facts. Any claim against the software vendor is a separate contract matter.

Does using a customs broker shift classification liability?

No. A broker files on the importer’s behalf, and the importer of record keeps the reasonable-care duty. Relying on a qualified broker who had complete and accurate product information can be evidence that the importer used reasonable care.

Can exporters self-classify ECCNs with software?

Yes. Under 15 CFR 732.3(b), exporters may classify their own items without BIS assistance and may ask BIS for a classification if they choose. A wrong classification does not excuse a missing license, so the exporter is responsible for the result whatever tool it used.

Software can make a large catalog manageable, but the record behind each code is what protects the importer. Before your next batch goes to entry, decide who reviews tool output, which products always get a human check, and where the reasoning for each code is stored.

TariffWolf’s classification platform returns a 6-digit HS code for each product with the notes, GRIs and rulings behind it, sends low-confidence and dual-use items to an in-house expert, and exports the per-SKU record your reasonable-care file needs. Your classifier or broker chooses the last four digits from that record. The platform overview explains how it works, and you can book a call to run a few of your own difficult SKUs through it.

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