CPC Ver.2

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Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules
Structure
Changes and new concepts
Application rules
Scope and boundary
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Changes and new concepts
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Scope and boundary
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• CPC Ver.2

Scope and boundary, concepts, application rules
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Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules
Structure
Changes and new concepts
Application rules
Scope and boundary
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Changes and new concepts
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Scope and boundary
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CPC Ver.2
Scope and boundary
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Purpose of the CPC
Scope and boundary
Structure
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Application rules
Application rules
Structure
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Scope and boundary
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Scope and boundary
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• CPC has three functions
• Serve as a central classification of products
• Requires links to other product classifications,
  such as HS, SITC, BOP, EBOPS
• Provide classification of all outputs of economic
  activities (production), as defined in the SNA
• Provide definitions of services (reference
  classification)

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Scope and boundary
Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules
Structure
Changes and new concepts
Application rules
Scope and boundary
Structure
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Scope and boundary
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• CPC covers products, i.e. the output of
  economic activities
• Market value not a criterion
• By-products and waste are also included
• These are output of economic activities
• Produced assets included as output of a
  production process.

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Scope and boundary (cont.)
Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules
Structure
Changes and new concepts
Application rules
Scope and boundary
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Changes and new concepts
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Scope and boundary
Structure
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Application rules

• SNA refers to products as goods and services
• However there are outputs of economic
  activities, i.e. products, that do not fit the
  SNA definition of goods or services

Goods Services
physical objects demand exist ownership can be established and transferred production and sale are separable activities Not separate entities for which ownership can be established Produced by order Changes the condition of the consuming units when production is completed, the product has already been delivered
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Scope and boundary
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Application rules
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Scope and boundary (cont.)

• Other outcomes from economic activities
• Original manuscripts, sound and video recordings
• Results of research activities
• Results from geological surveying activities
• Product design specifications
• Trademarks and franchises
• Neither goods nor services
• Still considered products, and covered in CPC
  Ver.2
• These are intellectual property (IP) products and
  similar products

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Important new conceptORIGINALS
Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules
Structure
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Application rules
Scope and boundary
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Scope and boundary
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• As we saw earlier, intellectual property (IP)
  products are output of economic activities and
  within scope of CPC.
• research results
• product design
• sound/video recordings
• trademarks/franchises
• computer software
• Value lies in information content, not physical
  form
• In the CPC, we talk about originals and content

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Important new conceptORIGINALS
Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules
Structure
Changes and new concepts
Application rules
Scope and boundary
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Scope and boundary
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• Originals are outcomes of intellectual or
  creative activities (before copying or
  distribution). Value lie in information content.
• When intellectual/creative activity carried out
  on own account the original is considered the
  output of that activity.
• However, when carried out for someone else
  (fee/contract basis), the output of the
  activity is considered a service.
• The original, in this case, is considered output
  of the client.
• Originals are not services
• Originals are not copies
• There is by definition never produced more than
  one original.
• Copying an original is an act of production. A
  new product (the copy) is being made.
• The copies are not originals, but they are often
  content products (as identified in the
  alternative aggregation).

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Classification of intellectual property products
Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules
Structure
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Application rules
Scope and boundary
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Scope and boundary
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• Originals
• are neither goods nor services
• are classified in part 5-9 of the CPC (i.e., the
  services part), close to the services with whom
  they are related
• e.g. research and development originals found in
  division 81 Research and development services
• Content
• Can be presented on physical media (disks, books,
  etc.), in which case the products are classified
  in CPC part 0-4 as tradeable goods.
• Can be provided in a non-physical way over the
  internet, in which case the products are found in
  group 843 On-line content

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Other scope issues

• One of the functions of the CPC is to serve as a
  central classification of products
• Other product classifications may cover products
  that are not produced
• e.g. some forms of waste, used products
• CPC covers these products as well
• Allows measurement of inputs for certain
  industries (proxy for output in physical terms)

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Scope and boundary
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Application rules
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Scope and boundary
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Scope and boundary
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CPC Ver.2
Application Rules
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Scope and boundary
Structure
Application rules
Application rules
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Application rules
Scope and boundary
Structure
Application rules
Scope and boundary
Structure
Changes and new concepts
Application rules
Application rules for section 0-4 (transportable
goods)

• Within the scope of the Harmonized System links
  exist
• Classify according to HS and identify the
  corresponding CPC class(es).
• HS has a comprehensive system of
• Section and Chapter notes
• Explanatory notes
• Index
• General Rules for the Interpretation of the
  Harmonized System
• If the relevant HS code links to more than one
  CPC class, CPC explanatory notes are provided.
• CPC index can also be helpful.
• Explanatory notes only in the case of split link,
  not provided for 1-1 cases.

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Scope and boundary
Structure
Application rules
Application rules
Structure
Application rules
Scope and boundary
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Application rules
Scope and boundary
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Application rules for section 0-4 EXAMPLE

• Where in the CPC do we classify unroasted chicory
  roots?
• HS code 1212.99. Where in the CPC does it link?
• 01391 Locust beans
• 01690 Stimulant, spice and aromatic crops
  n.e.c.
• 01802 Sugar cane
• 01809 Other sugar crops n.e.c.
• 01990 Other raw vegetable materials, n.e.c.
• We must consult the CPC Explanatory Notes

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Scope and boundary
Structure
Application rules
Application rules
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Scope and boundary
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Scope and boundary
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Scope and boundary
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Application rules
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Application rules
Scope and boundary
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Application rules
Scope and boundary
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Application rules for section 5-9

• Mainly concerns services
• Determine correct subclass using the provided
  descriptions (explanatory notes) of divisions,
  groups, classes and subclasses. The CPC index may
  also provide support.

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Scope and boundary
Structure
Application rules
Application rules
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Application rules
Scope and boundary
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Application rules
Scope and boundary
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Application rules
Application rules for section 5-9

• If more than one CPC subclass seems appropriate
• Prefer subclass with the more specific
  description
• Composite services classified according to the
  service component which gives them their
  essential character.
• If still ambiguous, choose category occurring
  last in numerical order
• Products making up a bundle of goods and services
  are classified to main component (according to
  value added).
• But breaking up product into homogeneous
  components should be considered first

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• END OF PRESENTATION