The United Nations Economic Commission for Europe (UNECE) administers the TIR Convention, which was established in 1959 and extensively revised in 1975 and which has, at present, 68 Contracting Parties. The TIR Convention provides for an internationally recognized procedure to facilitate the cross border transportation of goods in transit through the use of a standard, internationally recognized Customs document, the TIR Carnet, which also serves as proof of existence of an internationally valid guarantee.
For many years the TIR Convention proved to be an efficient facilitation tool. However, with the progress in technology, the use of the paper TIR Carnet is increasingly becoming archaic, in particular when it comes to linking it to the electronic procedures applied by national Customs administrations. At each border crossing, Customs officers are faced with additional work of having to key in up to 50 data elements into their national electronic Customs system. In addition, the current situation does not enable Customs authorities to effectively apply risk management procedures based on advance cargo information, as demanded by an increasingly more security-conscious environment.
The eTIR Project
The Contracting Parties to the TIR Convention launched in 2003 the so-called “eTIR Project”, aimed at providing an exchange platform for all actors (Customs authorities, holders, guarantee chains) involved in the TIR system, known as the “eTIR international system”. The eTIR international system aims to ensure the secure exchange of data between national Customs systems related to the international transit of goods, vehicles or containers according to the provisions of the TIR Convention and to allow Customs to manage the data on guarantees, issued by guarantee chains to holders authorized to use the TIR system.
Two recent articles reaching my desk reiterate the importance of clean and standardised Customs data. Without this, any real benefits to be derived from the latest and future technologies will not be fully achieved. Downstream, a country’s economy depends on this data for accurate analysis, forecasting and policy-making. Similarly, the business community relies on accurate information to assist in better business and investment decisions.
During the 15th PICARD Conference held during 23-26 November 2020, ‘World Customs Journal Special Edition’ was introduced. The first paper of the special edition is based on the keynote speech which was given at the 14th PICARD Conference in October 2019 titled “Data Science: Policy Implications for Customs”.
“Governance by data is a growing global trend, supported by strong national public policies whose foundation is open data, artificial intelligence and decision-making supported by algorithms. Despite this trend and some technical advances, Customs face obstacles in deploying ambitious data use policies. This article describes these challenges through recent experience in some Customs administrations and considers the technical and ethical issues speci c to all law enforcement agencies in the context of customs missions, to open paths for research and propose policy recommendations for a better use of customs data.”
The second matter is perhaps more directed towards Africa. TRALAC Newsletter, of October 2002 titled“Trade and Related Matters“discusses the importance of data, specifically now with the introduction of the African Continental Free Trade Area (AfCFTA) in January 2021.
The article considers more than just Customs trade data relating to goods. It envisages trade in services data as just as important to ensure a holistic approach –
“Trade-related data includes not only recorded values and volumes of goods trade among countries, but also data on services trade, non-tariff measures and barriers, tariffs, informal trade, trade restrictiveness, macro-economic conditions (like gross domestic product), micro-economic data (industry/firm-level data including employment, sales, profits and prices) and investment. This data is utilised by governments to make public policy decisions including the formulation of industrial, agriculture, trade and economic growth policies, strategies and regulations; trade negotiations strategies; merger and acquisition reviews; assessments of anti-competitive practices and determinations in trade remedy cases and applications for changes in tariffs. Businesses use trade information, such as tariffs in destination markets, applicable non-tariff measures, transportation costs and trade restrictiveness in combination with macro-economic indicators, firm-level data and market information to make investment, trade and market development decisions, and also to lodge trade remedy and tariff review applications and to inform their participation in public-private forums.”
The Newsletter continues to explain the notable improvements in data and reporting oer the last decade –
“Although trade and trade-related data has various uses, it needs to be useful, reliable and accurate information which is publicly available (except in the case of confidential information). This is the area where most African countries have historically fallen short although there has been some significant progress over the last decade. Initially, African trade data was only available on subscription databases and only for a select number of countries (like South Africa, Kenya and Egypt) and limited to trade in goods. There was a lack in published tariff schedules and data pertaining to non-tariff measures, investment, informal trade and services. In recent years, the availability of some data has improved significantly, especially for goods trade.
African countries are now increasingly publishing their statistics on websites of national statistics authorities and notifying their national data to the United Nations (UN). This data includes data on formal goods trade, aggregate services trade, non-tariff measures, tariffs, investment and some market information. The quality of the data has also improved as most countries now extensively verify the data prior to publication and submission. Increased access enables organisations like the World Bank, the World Trade Organisation (WTO) and International Trade Centre (ITC) to obtain, collate and publish trade data in databases like the ITC TradeMap and MacMap and the WTO trade portal.
As part of the implementation of the WTO Trade Facilitation Agreement, many countries are establishing trade portals. Southern and eastern African countries that already have functioning portals include Seychelles, Eswatini, Kenya, Rwanda and Uganda. Some portals contain detailed information on import and export requirements by specified product, sanitary and phytosanitary requirements, port of entry and applicable tariffs. The trade portals of countries in east Africa, including Uganda and Rwanda provide details of import or export processes including the trade costs such as inspection charges, and indicate the waiting time to complete the different steps.
Once fully operational, the African Trade Observatory (ATO) will contribute significantly to the availability of African trade data and capacity building. The ATO will collect and analyse trade and trade-related qualitative and quantitative data and information, establish a database for African trade; monitor implementation and evaluate the implementation process and impact of the AfCFTA and the Action Plan for Boosting Intra-Africa Trade (BIAT); and equip national governments and businesses to analyse and use of trade and related data.
Informal trade is recognised as a major component of intra-Africa trade and this is not captured in formal trade statistics. There are a number of initiatives to gather data on informal cross-border trade (ICBT), including studies by UNECAand ongoing work by the Bank of Uganda which has been conducting surveys and reporting ICBT data since 2005.
Although there have been improvements in intra-Africa trade data, there is room for improvement.”
To mark International Customs Day 2020 – focusing on the theme of ‘fostering Sustainability for People, Prosperity and the Planet’, the following article from the Spring 2018 edition of World Trade Matters by Jan Hoffmann, the Chief of the Trade Logistics Branch, Division on Technology and Logistics at UNCTAD, is relevant. The article discusses global trade facilitation reforms, the digitalisation of trade and measures towards ensuring long-term sustainability in the maritime industry.
Confronted with growing populism and a surge in protectionist measures recorded by the WTO, policy makers and enterprises are struggling to avoid a backlash in international trade. At UNCTAD’s Trade Logistics Branch, we support these endeavours by helping to make trade work better. Through trade facilitation reforms, the promotion of digitalisation, and ensuring the long-term sustainability of international transport, we aim at ensuring that the international movement of goods is not confronted with unnecessary obstacles and costs.
A multilateral agreement to facilitate international trade
Under the Trade Facilitation Agreement (TFA) of the World Trade Organization (WTO), developing countries commit to implement a number of very practical measures that make trade easier and more transparent. Countries are obliged to publish duties and procedures on the web, traders can transmit their declarations prior to the arrival of the goods, payments can be made electronically, and fees and charges must not become hidden taxes to generate income for the government. These are but some of the 37 concrete measures grouped into 12 Articles of the TFA. They are all useful and help make trade more efficient.
However, many of these measures involve an initial investment or reforms that require human and financial resources to start with, which developing countries many not have. The good news is that the TFA also includes a novel mechanism – the so called “Special and Differential Treatment” – that helps developing countries plan and acquire the necessary capacity prior to being fully committed to comply with all 12 Articles. Concretely, the mechanism puts the developing countries in the position – and obligation – to analyse and notify their own implementation capacity. At UNCTAD, we are working closely with the developing countries to enable them to do so. Our main counterpart in this endeavour are the National Trade Facilitation Committees (NTFCs) that each country must set up under the TFA. UNCTAD’s Empowerment Programme for NTFCs includes training and knowledge development for the members of the NTFC, combined with advisory services and the development of a Roadmap of TFA implementation.
By the same token, UNCTAD also supports developing countries in setting up Trade Information Portals. Under the TFA, members of the WTO are obliged to make relevant information on tariffs and trade procedures available on-line. UNCTAD’s Trade Information Portals not only help countries become compliant with this obligation, but in the process of analysing and publishing applicable trade procedures, a Trade Information Portal effectively helps countries identify the potential for the further simplification of procedures. Thanks to these new insights, NTFCs can then develop programmes and reforms that subsequently ensure the further simplification of procedures.
Technological progress will never be as slow as today
My favourite provision of the TFA is Article 10.1., as it provides for a dynamic dimension of the Agreement. According to this article, countries need to minimize “the incidence and complexity of import, export, and transit formalities”, continuously “review” requirements, keep “reducing the time and cost of compliance for traders and operators”, and always choose “the least trade restrictive measure”. As such, even if a country is compliant with all TFA provisions today, countries will need to continue monitoring if existing procedures are still appropriate in view of technological or regulatory developments.
As trade becomes increasingly digitalised, and new technologies which do not yet exist will be developed, it will be important that governments continuously revise and review the applicable rules and regulations.
Digitalisation comes in stages. First, we optimize existing procedures, making use of cargo tracking, the Internet of Things, blockchain et al. Second, new businesses are developed which could not exist without the new technologies; new platforms come into being and we see more “uberisation”. Finally, there is transformation and science fiction; still in our lifetime Artificial Intelligence will overtake human capabilities to manage international trade and its logistics.
But let us take one step at a time. At UNCTAD, we support developing countries through eTrade readiness assessments, the development and upgrade of technological solutions in Customs automation and Single Windows, and by providing a Forum for our members to analyse and discuss the challenges that come with digitalisation. We encourage the development of global standards that allow for interoperability among new systems. The challenge for policy makers it to encourage private sector investments in new technologies and solutions, while ensuring that no new monopolies emerge that might exclude smaller players.
And it has to be sustainable
While we aim at ensuring continued growth in international trade, there is a catch. The transport of this trade encompasses increasing externalities, such as pollution, green-house-gas emissions, and congestion.
Ports need to minimise social and environmental externalities. Many port cities are among the most polluted places to live, as ships burn heavy oil, and delivering trucks produce noise and cause traffic congestions. In addition, ports need to be resilient in the face of disruptions and damages caused by natural disasters and climate change impacts.
International transport, including shipping, needs to play a larger role in addressing global warming and contribute to mitigating the carbon emissions that are causing climate change. Shipping emits less carbon dioxide (CO2) per ton-mile than other modes of transport, but then due to its sheer volume it also produces many ton-miles. Would it be possible that the industry could be charged by its main regulatory body not per ship tonnage (as is currently the case), but per tonne of CO2 emission?
Currently, the International Maritime Organization is funded proportional to the tonnage registered under the members’ flags. Like this, Panama, Marshall Islands and Liberia pay for the largest share of the IMO budget – and in the end, this is passed on to the ship-owner, who in turn passes this on to the shipper, who will charge the consumer. This is a good established mechanism that could be expanded to also internalize the external costs of CO2 emissions.
Being the most globalized of all businesses, maritime transport should consider adopting a global regime that helps further internalize its environmental externalities – to ensure prosperity for all.
It is all about efficiency
Investing in trade facilitation reforms, making intelligent use of the latest technologies, and ensuring that externalities are internalized are all several sides of the same coin. Trade efficiency is necessary to promote an open international trading system. It requires a continuous effort by policy makers to continuously review current procedures, apply the most appropriate technological solutions, and support an efficient allocation of scarce resources.
Source: Jan Hoffman, UNCTAD – originally published in World Trade Matters, Spring Edition, 2018
Almost the size of Pretoria, this 62,000 hectare private reserve on the border with Kruger National Park has upped its game against poaching.
What was once an operation with a handful anti-poachers patrolling an electric fence and hiding in watch towers has now been turned into a 21st century fortress in the bush.
This is all thanks to a pilot project called “Connected Conservation“, a collaboration between 48 private lodge owners, the tech company Cisco, and Dimension Data, the data solutions company.
While there had been great initiatives to protect the rhino over the years, these were reactive and the number of these animals being killed were increasing at an alarming rate. By combining tech thermal imaging cameras and thumb-print scanners with things like sniffer dogs, the reserve tracks the movement of people before they get close to endangered animals.
Since it began in 2015, the upgrades have brought about a 96% reduction in rhino poaching incursions, as well as reducing illegal incursions into the reserve by 68%. Key to the success has been reducing ranger response time from 30 minutes to 7 minutes.
Growing electronic commerce (E-Commerce) has provided unparalleled opportunities for and has become a game changer in the international trade arena. It has revolutionized the way businesses and consumers are selling and buying goods with wider choices, advanced shipping, payment, and delivery options. At the same time, E-Commerce, in particular Business to Consumer and Consumer to Consumer (B2C and C2C) transactions, is presenting several challenges to governments and businesses alike.
The WCO Working Group on E-Commerce (WGEC) together with its four Sub-Groups is steadily progressing with the four identified work packages, namely Trade Facilitation and Simplification of Procedures, Safety and Security, Revenue Collection, and Measurement and Analysis with a view to develop recommendations/guidelines on cross-border E-Commerce from a wider facilitation, security or revenue perspective, to collect and disseminate good practices/initiatives, and to enhance/update related WCO instruments and tools.
Given the current focus of the WCO Members and the private sector on this topic, the 215th/216th Sessions of the Permanent Technical Committee (PTC) held a whole day dedicated session on E-Commerce on 5 April 2017. During the ‘E-Commerce Day’, the delegates were provided an update with the work done thus far, as well as, the envisaged work by the four Sub-Groups on respective work packages. A number of valuable suggestions were provided by delegates from policy, business process, and operational perspectives to further enhance the WCO E-Commerce Work Programme with tangible and practical deliverables for providing a concerted and effective response to this growing channel of trade.
In addition, four thematic workshops relating to different dimensions of E-Commerce were organized by the Sub-Groups’ Co-Leads together with other partners. Through these workshops, some interesting facets of e-commerce were explored in detail and a number of interim recommendations were made concerning facilitation, risk management, safety and security, revenue collection, and associated capacity building through enhancement partnerships with all e-commerce stakeholders and augmented public awareness and outreach programmes.
In the course of the panel sessions, a number of collaboration success stories were identified, and they will be captured more formally and shared with interested parties, through the WCO webcorner.
The WGEC Sub-Groups will continue carrying out further work and a consolidated set of interim recommendations will be presented to the July 2017 Sessions of the WCO Policy Commission and Council. Source: WCO
Innovative technology for the non-intrusive inspection of cargo and vehicles has rapidly emerged over the last decade to become a significant factor in port and border protection and homeland security. Several hundred high-energy mobile and fixed-site X-ray inspection stations are deployed throughout the world to examine passenger cars, trucks, trains, and shipping containers that transport goods bound for international destinations. Behind the scenes, cargo screening technology continues to be a story of innovation and change, driven by keen competition and a common mission to improve global security.
Early cargo screening systems were relatively slow and expensive to operate. They produced a limited resolution single-energy X-ray image, often using an isotope source such as Cobalt-60. The imaging software was rudimentary, and limited to simple controls such as pan and zoom, while computer processing speeds significantly limited inspection throughput. By contrast, most systems today are accelerator-based, which allows for higher energies, faster operation, and more precise controls. These systems incorporate software that takes advantage of improved computing platforms and features increasingly sophisticated analytics – this power has paved the way for the use of dual-energy accelerator sources and advanced detectors to facilitate material discrimination, enabling inspectors to identify threat objects more quickly, based on their composition.
Future developments in cargo screening are likely to follow a common innovation trajectory that is fostered by market needs and new technology, while being strengthened by existing intellectual property and evolving industry standards. Innovation is often perceived as a circular path beginning with customer needs that are identified by a technology developer. The developer then creates application technology in the form of products to meet those needs. With numerous competitors in the market, suppliers are motivated to continually improve their products. However, a more nuanced understanding incorporates the role of component technologies and the core capabilities of the technology developer. Each of these constituents influence and are influenced by their respective technology and regulatory standards, which then ultimately impact the products available to the customer. For the full report with diagrams,Click Here!
Component technologies and their standards are often driven by the needs of other markets and may only be tangentially connected with the market of interest. Consequently, developers often have minimal influence on these technology standards but will benefit by leveraging the investments already made by other organizations. ‘Components’ may be subassemblies (such as a computer graphics card) or entirely separate systems (such as a cloud computing service) that can be incorporated into a screening system to provide a complete customer solution. System providers benefit from these parallel technologies and component standards because they provide innovative insights and functional capabilities, such as interoperability, interchangeability, and known performance characteristics. In the case of cargo screening, there are many component technologies that are potential sources of future innovation. A few notable examples are described later in the report.
Because cargo screening is a youthful market with changing customer requirements and technology that is evolving to meet those requirements, existing industry standards are still in flux. This is beneficial for the cargo screening industry in that it provides ample room for innovation and development. As cargo screening technology continues to evolve and mature, the community will develop consensus in more areas and create additional standards. However, the standards process is slow and seldom speaks to the most current technology issues in an industry. For example, material discrimination is an important new feature offered by many cargo screening systems, yet there is little guidance from current industry standards to assess the performance of this technology. Source: www.porttechnology.org
Mondial Defence Systems provide the full range of CBRNe (Chemical, Biological, Radiological, Nuclear and Explosive) solutions to government, military and civil agencies.
The FlatScan 27 is a highly innovative flat portable battery-powered X-ray photodiodes system that has been specifically designed for high-speed and high-resolution inspection tasks. It incorporates a state-of-the-art 2D (two-dimensional) self-contained robust scanning detector, a laptop computer and a CP120B or CP160B portable constant potential X-ray generator to deliver real-time image processing. FlatScan 27 was developed in cooperation with specialised EOD (Explosive Ordnance Disposal) teams and comprises various unique features, specifically to meet any emergency situation. The technology will predominantly be of interest for applications used by the military, police, prisons and customs.
The FlatScan 27 comprises a large number of unique technological features and delivers a versatile and highly thin detector (thickness of just 55mm). This detector means that large objects with dimensions up to as much as 535 x 412mm can be scanned in just one attempt, even in situations where they might be located in very inaccessible places (e.g. close to a wall).
Flatscan 27 providing material discrimination and conventional scanning capability
Furthermore, the FlatScan 27 delivers an excellent image quality with a high penetration capability (up to 34mm of steel at 160kV, 0.5mA). This is possible as a result of its sensitivity, the 800 microns resolution and the ability it offers for slowing down the speed of the scanning detector.
The FlatScan technology can be extended through a variety of options including materials separation. This involves the colour coding of a package to indicate whether the components inside are organic or inorganic in nature. This option delivers extra insight to the operator when making an informed judgment relating to the contents of suspect objects or packages.
The detector is equipped with a battery that lasts for two hours, while the two X-ray source cells each enable the development of up to 200 images. It should be noted that in cases of long-lasting laboratory applications, both items can be powered by optional mains power supplies.
For quick on site intervention, the FlatScan 27 detector can be easily transported in a backpack, while all accessories are stored in a carrying case. For more information visit – http://www.mondial-defence.com
Port Technology International (PTI) reported last month, a ground-breaking technological development from UK-based Inscentinel could change the future of security at ports. In a move that brings together nature and technology, bulk cargo screening could soon be carried out by an unlikely source – sniffer bees.
Freight forwarding companies screen 100 percent of all of their parcels. The first line of screening relies on X-rays followed by REST dogs for special items which cannot be screened. REST, stands for Remote Explosives Scent Tracing.
This works by sampling the air from the cargo through a specially designed filter. This filter, which can trap explosives molecules, is then presented to the most accurate explosives detector ever – dogs. This method has proven very effective to exploit the accuracy of dogs while maximizing the throughput volume of screening, which a free-running dog cannot otherwise do.
According to the information found on the website of Diagnose, a subsidiary of ICTS: ‘The technique has screened over 100,000 trucks and pallets and over 1.5 million metric tons of air cargo since live operations began in the UK and France. The RASCargO™ technique was specially developed to serve the mass screening cargo market that requires a solution for screening high volumes of dense cargo, with actually, no cargo size limitation, a solution that combines high detection rate with cost effectiveness.’ Read the full report as published in PTI here!
Inscentinel’s latest video, below, shows how the company has devised an ingenious way of using the insect in the cargo screening process.
The recent death of a close friend and colleague – Lester Millar – brings to mind, once again, the dire situation of a dwindling ‘knowledge base’ in the area of Customs’ core competency. In an era where most customs or border management authorities are happy to employ people with a variety of tertiary qualifications – with the idea that this alone will be sufficient to ‘arm and support’ them in the field of customs/border control and management – what happened to the skills of yesteryear which allowed both government and trade practitioners to exercise their technical abilities to agree or disagree amicably on a customs tariff or valuation interpretation that could result in thousands of rands (ZAR) going to state coffers or the retailer’s bank account?
Many would argue that with the extent of automation and modern techniques, customs core skills are no longer valid or even necessary. Indeed the extent and design of systems goes so far as removing the relevance of human intuition and decision-making. Today we have automated risk management, automated duty calculation and declaration processing, automated cargo and goods accounting, any even a call centre – so is there really a role for a Customs specialist in the 21st century? Customs Managers today have their reports and other so-called ‘empirical data’ to rely on for decision-making and strategizing. The year-end revenue rush, it-self, relies on such computer generated reports negating the need for an internal ‘think-tank’ to devise means of collecting the hidden revenue before the deadline.
For those in the trade, a similar situation exists, with some difference however. The traditional customs clearance and cargo reporting process is highly mechanised these days and if your systems are up to the task, you can rest assured staff can remain glued to their seats and screens without having to venture to the Customs House. Here too, lies a significant change. The traditional Custom House no longer exists and is basically home to the ‘Customs Frontline’ which deals with ‘physical’ intervention and other trade services. Tariff, Valuation and Origin are now confined to back-office functions accessible via a call centre or tiered response mechanisms embedded in Customs’ new automated workflow; that is, if physical or telephonic access to regional customs specialists have been removed.
Few can dispute the advantages of technology supported processes. Yet, when things go array, even the knowledgeable people have difficulty in resolving an issue. Some suggest that human discretion is dangerous and counter-productive, which perhaps is true if left to an uncouth, power-crazy customs or border control official. Yet, ‘discretion’ is a tenet most necessary for interpretative and cognitive skills which once most Customs Officials used to have.
So what is this core competency to which I refer? First of all Customs competency requires an officer to reason, interpret and apply the customs law in the “fairest” possible way based on the facts at his/her disposal. So it means the officer must have an ability to discern; importantly between right and wrong. Discernment must also take into account an acute understanding of previous/historical evidence relating to a case. For a customs official, it will be important to comprehend the rights and legal obligations of the parties concerned, as well as the documentation relating to the case/transaction. Moreover, where a case/transaction deals with a matter of ‘tariff’, or ‘valuation’ or ‘origin’ the officer must at least have the basic knowledge and skills of the internationally defined rules of interpretation in these disciplines. I say ‘at least’, because in any of the mentioned areas, it may require an expert opinion to further conclude the outcome of a matter.
While automation will take care of validation and computation to the n’th degree, storing and retrieving vast amounts of data in milliseconds, the fact remains that a competent ‘human being’ is still required to preside over a complex decision. Good systems are built on ‘rules’, not exceptions. It is the latter therefore that requires ‘customs core competency’ to resolve.
Our dear friend and colleague Lester was gifted with a phenomenal ability to distill and comprehend information. This knowledge made him one of our finest, and sadly virtually last remaining tariff experts. Add to this, a wonderful and helpful nature and willingness to serve the public – a not too common trait nowadays. Adios Lester…..since we did not fully profit from your time with us, may we at least profit from our loss!
doesn’t this just sound so familiar? What a fine article by Chris Kane, Chief Strategy Officer of a family owned third-party logistics provider (3PL).
As the U.S. economy continues to struggle and unemployment remains high, our industry has focused on cost cutting through automation. Technology has undoubtedly helped us move more products more quickly and less expensively than ever before, but have we focused so much on automation and technology that we’ve neglected to identify how they affect the people in our supply chain?
I’m a distribution guy, so I’m the first to admit that technology provides visibility into our operations that makes my life much easier. A single report can tell me exactly where a specific load for any one of our customers is located in real-time. What it doesn’t tell me is how our people in the distribution center hustled to get the trailer loaded, even after a forklift problem, so that the driver didn’t miss his delivery window. Or how the driver’s skills helped her avoid an accident that would have destroyed the customer’s product. If I just look at that report, I miss the most important aspect of our business: the dedication of our people. When things go wrong (as they inevitably do), technology will only get us so far.
Is our industry fast paced? Absolutely. Do we need to utilize the technology available to be more efficient, more cost-effective and more competitive? Of course. But if we pursue those options exclusively, with little regard for the people running our operations, we’ve failed. Because at the end of the day, it’s the efforts of the people in the supply chain that get the product to its destination.