Customs Day – let’s not forget the heroes!

While the world’s customs administrations prepare to celebrate International Customs Day, the grim reality of the fight against crime stares back at us right here in our own back yard. Just a few days ago, customs officers and investigators learnt of the sudden and tragic death of their colleague Johan Nortje, who was gunned down in his driveway in Durban. Johan was a counterfeit investigator.

It is ironic that while customs administrations spend a lot of time in developing electronic systems in the fight against crime, little thought is in fact given to the ‘risks’ facing the official on the ground. In this age of data systems, proactive risk assessment, and frontline scanning it still remains the responsibility of a ‘human’ officer to make the ‘judgement calls’ and ‘physical intervention’ where necessary. Let’s hope this incident does not go unheeded. It helps little if a lot of time and money is spent on ‘capacity building’ and there is not a plan to retain and safeguard these ‘intellectual’ interests.

Something for Solution Developers

Herewith a link for service providers: http://www.tradefacilitate.com/ . You can read the case study at the following link: Microsoft Case Study: Microsoft Visual Studio 2010 Ultimate – TradeFacilitate

EDI is Dead – Long Live EDI!

SARS Customs mainstream communication channel with the South African business community has received a major boost, with the installation of a new EDI Gateway. This forms part of SARS’ commitment – relating to increasing demands on its ICT architecture – to meet the rapid increase in B2G (business-to-government) electronic transaction exchanges. Currently for every import, export or cross border declaration transactions, there are a minimum of 2 EDI interchanges per consignment – a Customs declaration message (CUSDEC), and a Customs response message (CUSRES).
Once cargo reports (cargo manifests and cargo notifications) are all being received electronically this average will increase substantially. The future customs clearance process envisages a totally paperless environment. Therefore, any instruction or notification regarding an import or export transaction will need to be handled via electronic messaging between Customs and the Trader. This implies significant more data storage and a reliable network ensuring continuity of business. At present trade declaration (SAD500) volumes are in the region of about 4, 3 million per annum. The need for high-volume / real-time processing is therefore a no-brainer.
The Customs Modernisation Programme (CMP) has undertaken a number of initiatives in regard to maintaining pace with world trends. It is currently reviewing its data models; consolidating import, export and cross border modes; and aligning all its data requirements with the WCO Data Model version 3. Combined with envisaged changes being brought about through the introduction of clearance within Customs Procedures, SARS’s desire is to adequately meet the demands of trade and its accession obligations regarding the WCO Revised Kyoto Convention. In the near future, Customs Response and Cargo Report data requirements will be aligned and consolidated in similar manner. This alignment therefore puts SARS in a position to consider a future migration path – the adoption of the Government Cross Border Regulatory message (GOVCBR).

Customs & Excise and the Portcullis

A portcullis is a latticed grille or gate made of wood, metal or a combination of the two. The portcullis often appears as a device or emblem in heraldry, such as that employed as the symbol for the Palace of Westminster, London. Another example is where a portcullis formed the crest of the now defunct HM Customs and Excise. They have used the badge for some centuries. Apparently, the portcullis came to be regarded as a symbol representing the gates of the kingdom, that is, the seaports; which were, of course, the seats of operation of the Customs. In fact many Customs administrations incorporated the portcullis in their emblems prior to the 1990’s. The former Department of Customs and Excise, South Africa, likewise bore a portcullis in its coat of arms. (I will endeavour to locate a picture of it in due course).
The portcullis is the traditional symbol of Customs. It is a symbolic representation of a nation’s ports, that is, the gates through which international trade must pass. For centuries, the role of gatekeeper has fallen to Customs. The Customs Co-operation Council (now known as the World Customs Organization), was an early proponent of the need for Customs authorities to reconsider their traditional approach to international trade control, and to abandon the ‘gatekeeper’ mentality that has dominated their thinking for hundreds of years. Such a mentality often sees Customs intervene in commercial transactions simply for the sake of intervention. They have the authority to do so, and no one is keen to question that authority.

In this day and age, however, social expectations no longer accept the concept of intervention for intervention’s sake. Rather, the current approach is “intervention by exception”. Intervention when there is a legitimate need to do so. Intervention based on identified risk. 

At the same time, the trade facilitation agenda is gaining increasing momentum, as the Doha Ministerial Declaration and subsequent decisions of the General Council of the World Trade Organisation have sought to intensify international commitment to further expedite the movement, release and clearance of internationally traded goods, including goods in transit. These decisions are replicated in the World Customs Organisation’s Convention for the Simplification and harmonisation of Customs Procedures , more commonly known as the Revised Kyoto Convention. (I will discuss this in more detail in a future blog.) 

The success of implementing such agenda is heavily reliant on the ability of Customs to raise the portcullis in an effort to achieve an effective balance between trade facilitation and regulatory intervention. It requires political will of governments, which often does not readily understand the notion of give and take; especially countries where revenue derived through Customs accounts for a significant portion of its gross revenue income. 

While many, if not most Customs administrations, are undergoing radical change, it is always difficult to gauge whether the benefits and ‘step change’ anticipated at the outset are in fact attained. Often, the success stories focus on the legislative or technology innovation as opposed to the ‘real’ effects experienced on the ground and by customs officials and the trade, specifically. What of the organisational displacement which has occurred by the introduction of new technology where previous Customs activities have been rendered redundant; or, as a result of the closure of internal border offices in the case customs union or regional expansion? It seems that there will eventually be few who can raise the portcullis in the face of diminishing skills and expertise.