BR0011328 AGrainger - WCO PICARD 2007 (March) EN...Üthe interests of actors and the implementation of trade facilitation concepts Üthe human and organisational capabilities necessary

March 2007 www.tradefacilitation.co.uk Page 1

Andrew [email protected]

2nd PICARD Conference at the World Customs Organisation, Brussels, 27-28 March 2007

Supply Chain Security: adding to an already complex operational and

institutional environment


Supply Chain Security

n the US-led CTPAT and CSI programmesn the European Union’s Security Amendment to the Customs Code

(648/2005/EC)n the Swedish Stairsec programmen the Canadian Partnership in Protection programme n the New Zealand Secure Export programmen the Australian Frontline programmen the ISO/PAS 28000 standard for supply chain security systemsn the IMO’s security amendment to the SOLAS convention and the

newly drafted ISPS coden various IATA initiatives including the known shipper conceptn the WCO’s framework of standards to secure and facilitate global

trade (WCO 2005)


Regulatory Security Objectives

n Identify security risks before goods move. n Make efficient use of finite enforcement

resourcesn To enhance controls at the bordern Ensure that wealth-generating trade

continuesn Extending controls up and down the

supply chain


Government: a new thread running across the supply chain?

ProcurementManu-

facturingFactory Distribution CustomersSuppliers Endusers

Bor

der

Bord

er

Bor

der

Bor

der

Government Actors

Bord

er

Bord

er


The Cross-border Operational System

Seller

$

$

$

BuyerCountry A Country B

Global Freight Forwarding Company / Transport Integrator

Local Freight Forward Shipping Line Local Freight Forward

Local Freight Forward

Local Haulage Company / Trucker Airline Line Buyer’s own Truck

Local Haulage Company /

Trucker

Local Freight ForwardCustoms Broker Shipping Line

Shipping Agent

Seller’s own Truck

Global Freight Forwarding Company / Transport Integrator Bank

Shipping Line Third Party Logistics Service Provider


Trucker

Local Freight Forward (B)

Local Freight Forwarder (A)Airline LineBank Customs Broker

Customs BrokerBank

Port StevadorePackaging Company

Inland Port or Warehouse

Shipping Line

Port OperatorConsolidator


Trucker

Customs Broker

Rail Road / Train Operator

Local Haulage

Company / Trucker

Warehouse

Local Freight Forward

Transit Shed

Free Zone or Customs

Warehouse

Source: own practitioner observations; interviews

Shipment


Many Trade Procedures

Administration of Quota restrictions; CAP refundsTrade Policy

Product testing; labelling; conformity checks with marketing standards (e.g. fruit and vegetables)

Consumer Protection

Phytosanitary, veterinary and hygiene controls; health and safety measures; CITES controls; ships’ waste

Environment and Health

Security and anti smuggling controls; dangerous goods; vehicle checks; immigration and visa formalities; export licences

Safety and Security

Collection of Customs duties, excise duties and other indirect taxes; payment of duties and fees; management of bonds and other financial securities

Revenue Collections

Examples of related activityRegulatory Category


Concerns and Perceptions

n Technologyn Performance of governmentn Capabilitiesn Trade proceduresn Cooperation between actorsn The performance of businessn Uncertainty


SCS: Adding to the Equation

n Many institutions are involved:Ü GoodsÜ Transport and vehiclesÜ People

March 2007 Page 9 www.tradefacilitation.co.uk

H M R CD e p a r t m e n t f o r

T r a n s p o r t

H o m e O f f i c e

U K T r a d e r s a n d the i r

r e p r e s e n t a t i v e s

T r a n s p o r t O p e r a t o r s

Por ts

D G T A X U D D G T r e n

W C O S u p p l y C h a i n

S e c u r i t y F r a m e w o r k

I M O I S P S C o d e

I A T A K n o w n S h i p p e r

I S O 2 8 0 0 0

U S B i o t e r r o r i s m

A c t

U S C u s t o m s a n d T r a d e P a r t n e r s h i p A g a i n s t T e r r o r i s m

(C T P A T)

U S C o n t a i n e r Secu r i t y In i t ia t i ve

(C S I )

E U C u s t o m s C o d e

Secu r i t y A m e n d m e n t

U S C u s t o m s a n d B o r d e r P r o t e c t i o n

I m m i g r a t i o n a n d

Na t iona l i t y A c t

W C O I M O I A T A ISO

T R A N S E C

U S F o o d a n d D r u g A d m i n i s t r a t i o n

S e c u r i t y m e a s u r e s a p p l i c a b l e o r p r o p o s e d :- E U C u s t o m s C o d e S e c u r i t y

A m e n d m e n t (m a n d a t o r y 2 0 0 9 )

- I S O 2 8 0 0 0 (o p t i o n a l)- C T P A T (O p t i o n a l)- B i o t e r r o r i s m A c t

R e g i s t r a t i o n (U S A t r a d e o n l y )

- I A T A K n o w n S h i p p e r (o p t i o n a l)


A m e n d m e n t (m a n d a t o r y 2 0 0 9)

- I S O 2 8 0 0 0 (op t i ona l )- C T P A T (U S A o n l y )- B i o t e r r o r i s m A c t


- I A T A K n o w n S h i p p e r (o p t i o n a l)

- D f T O p e r a t o r L i c e n c e (m a n d a t o r y )

- T r a d e d e c l a r a t i o n s u n d e r H o m e O f f i c e l e g i s l a t i o n (m a n d a t o r y )


A m e n d m e n t (m a n d a t o r y 2 0 0 9 )

- I S O 2 8 0 0 0 (o p t i o n a l)- C T P A T (U S A o n l y )- B i o t e r r o r i s m A c t


- H M R C a u t h o r i s a t i o n (m a n d a t o r y )

- T r a d e d e c l a r a t i o n s u n d e r H o m e O f f i c e l e g i s l a t i o n (m a n d a t o r y )

- I S P S C o d e- C S I (U S A t r a d e o n l y )- O p e r a t i o n o f d e t e c t i o n

e q u i p m e n t u n d e r C y c l a m e n

T e r r o r i s m A c t

I n t e r n a t i o n a l l y -s e t S e c u r i t y R e g i m e s

E U -s e t S e c u r i t yR e g i m e s

S e c u r i t y R e g i m e s i n t h e U K

U S -s e t S e c u r i t y R e g i m e s

P r o j e c t C y c l a m e n

S e c u r i t y l e g i s l a t i o n o r p r o g r a m m e

I n s t i t u t i o n o r g o v e r n m e n t b o d y

D e m a r c a t i o n o f p o l i c y l e v e l

L e g e n d :


H M R C (Na t i ona l L e v e l)

C u s t o m s i n o t h e r E U M e m b e r

S t a t e s

U S C u s t o m s a n d B o r d e r P r o t e c t i o n

E u r o p e a n C o m m i s s i o nD G T A X U D

U K T r a d e A s s o c i a t i o n s a n d I n t e r e s t G r o u p s

L o c a l T r a d e A s s o c i a t i o n s a n d

G r o u p i n g s

W C O

E u r o p e a n A s s o c i a t i o n s a n d I n t e r e s t G r o u p s

I n t e r n a t i o n a l A s s o c i a t i o n s a n d I n t e r e s t G r o u p s

A d v i s e o nc o n c e r n s

H M R C (Loca l L e v e l)

S h a r ec o n c e r n s

A p p l y U K /E U p r o c e d u r e s

E s c a l a t e i s s u e sw h e r e t h e y c a n n o t b er e s o l v e d l o c a l l y

- S h a r e c o n c e r n s - Pa r t i c i pa te i nC o n s u l t a t i o n

E s c a l a t e i s s u e sw h e r e i t c a n n o t b e

r e s o l v e d l o c a l l y

E s c a l a t e i s s u e sw h e r e t h e y c a n n o t b er e s o l v e d i n t h e U K

- S h a r e c o n c e r n s(e .g . t h r o u g h T C G )- Par t ic ipate inc o n s u l t a t i o n s

Seek to i n f l uencet h r o u g h a g e n c yo f m e m b e r s

N e g o t i a t eU K p o s i t i o n

N e g o t i a t e p r e f e r r e dp o s i t i o n

C o -ope ra t i ona g r e e m e n t s

E s c a l a t e i s s u e sw h e r e t h e y c a n n o t b er e s o l v e d i n t h e E U

- S h a r e c o n c e r n s (e . g. a s N G O s )- Pa r t i c i pa te i nc o n s u l t a t i o n

- S h a r e c o n c e r n s (e .g . a s N G O )- Pa r t i c i pa te i nc o n s u l t a t i o n

Deve lop in t .i n s t r u m e n t s

D e v e l o p i n t.i n s t r u m e n t s

Ind i v idua l B u s i n e s s e s

S e n d g o o d s


O p e r a t eC T P A T R e g i m e


C o o p e r a t i o na g r e e m e n t s

C o o r d i n a t eU K p o s i t i o n w i t h

o t h e r E U m e m b e r s

O p e r a t eC S I R e g i m e

D e v e l o p i n t .i ns t rumen ts

Deve lop in t .i n s t r u m e n t s

I n t e r n a t i o n a l L e v e l

E U L e v e l (R e g i o n a l)

U K L e v e l (N a t i o n a l)

T h i r d C o u n t r y L e v e l (U S A )

U K L e v e l (L o c a l)

D e v e l o p i n t.i n s t r u m e n t s

D e v e l o p i n t.i ns t rumen ts

D e v e l o p i n t .i ns t rumen ts

A b b r e v i a t i o n s :I n t. I n t e r n a t i o n a l

P u b l i c S e c t o rP r i v a t e S e c t o rD e m a r c a t i o n o f p o l i c y l e v e l s

L e g e n d :

L o c a l P o r t

L o c a l P o r t

L o c a l P o r t...

O t h e r I n t e r n a t i o n a lI n s t i t u t i o n s



...


A i r l i ne Ope ra to r s C o m m i t t e e C a r g o

(A O C C) [ c a r g o h a n d l e r s ]

A u t o m a t e d C u s t o m s a n d I n t e r n a t i o n a l T r a d e

A s s o c i a t i o n (A C I T A ) [ l a r g e m a n u f a c t u r e r s ]

F r e i g h t T r a n s p o r t A s s o c i a t i o n [ in-h o u s e

t r anspo r t ope ra to r s ]

R o a d H a u l a g e A s s o c i a t i o n (R H A )

[r o a d h a u l a g e ]

C h a m b e r o f S h i p p i n g [ s h i p p i n g ]

U K W a r e h o u s i n g A s s o c i a t i o n (U K W A )

[ w a r e h o u s i n g s e r v i c e s]

U K C o m m e r c i a l A v i a t i o n I n d u s t r y C u s t o m s G r o u p

(U K C A I C G ) [a i r c ra f t m a n u f a c t u r i n g ]

I n t e r n a t i o n a l R o a d U n i o n ( I R U )

[ r o a d t r a n s p o r t]

A s s o c i a t i o n o f I n t e r -n a t i o n a l C o u r i e r a n d

E x p r e s s S e r v i c e s (A I C E S ) [pa rce ls ]

I n s t i t u t e o f C h a r t e r e d S h i p b r o k e r s ( I C S B )

[ s h i p p i n g a g e n c y se rv i ces ]

F o o d a n d D r i n k F e d e r a t i o n (F D F )

[f o o d i n d u s t r y ]

C u s t o m s P r a c t i t i o n e r s G r o u p (C P G )

[spec ia l i s ts , a d v i s e r s a n d l a w y e r s ]

C u s t o m s A i r T r a n s p o r t C o n s u l t a t i v e G r o u p (C A T I C G ) [ a i r l i nes]

C o n f e d e r a t i o n o f B r i t i s h I n d u s t r y (C B I)[UK Indus t ry ]

B r i t i s h P o r t s A s s o c i a t i o n (B P A ) [ po r t i ndus t r y ]

B r i t i sh I n te rna t i ona l F r e i g h t A s s o c i a t i o n

(B I F A )[f re igh t fo rwarders ]

B r i t i s h C h a m b e r s o f C o m m e r c e

[ U K b u s i n e s s e s ]

S I T P R O U K T r a d e F a c i l i t a t i o n A g e n c y

W i n e & Sp i r i t s A s s o c i a t i o n

[U K d r i n k i n d u s t r y ]

A s s o c i a t i o n o f F r e i g h t S o f t w a r e S u p p l i e r s (A F S S ) [ s o f t w a r e

d e v e l o p e r s ]

I n v i t e d R e p r e s e n t a t i v e s:U K P o r t C o m m u n i t y

S y s t e m P r o v i d e r s [I T ]

O n e I n v i t e d R e p r e s e n t a t i v e f r o m t h e

R a i l I n d u s t r y

I n t. C h a m b e r o f C o m m e r c e U K ( I C C U K )

[t r a d e & c o m m e r c i a l s e r v i c e s]

U K M a j o r P o r t s G r o u p (U K M P G ) [ po r t i ndus t r y ]

F e d e r a t i o n o f E u r o p e a n T r a d e F a c i l i t a t i o n

C o m m i t t e e s (E U R O P R O )

F e d e r a t i o n o f E u r o p e a n B u s i n e s s A s s o c i a t i o n s

(U N I C E) [E U b u s i n e s s]

E u r o p e a n E x p r e s s A s s o c i a t i o n (E E A )

[ pa rce ls ]

E u r o p e a n E l e c t r o n i c C o m p o n e n t s I n d u s t r y

(E E C I) [ m a n u f a c t u r i n g ]

E u r o p e a n A s s o c . f o r F o r w a r d i n g , T r a n s p o r t ,

L o g i s t i c s & C u s t o m s S e r v i c e (C L E C A T) A m e r i c a n C h a m b e r s o f

C o m m e r c e t o t h e E U (A M C H A M E U )

[U S b u s i n e s s e s i n E U ]

A s s o c i a t i o n o f E u r o p e a n A i r l i n e s (A E A ) [a i r l i n e s]

A s s o c . E u r o p e a n S e m i c o n d u c t o r I n d u s t r y

A s s o c i a t i o n (E S I A ) [ m a n u f a c t u r i n g ]

E u r o p e a n S h i p p e r s C o u n c i l (ESC ) [t r a d e r s

a n d f r e i g h t u s e r s ]

E u r o p e a n C o m m u n i t y S h i p o w n e r s ’ A s s o c i a t i o n

(E C S A ) [s h i p p i n g ]

E u r o p e a n S m a l l B u s i n e s s A l l i a n c e

(E S B A ) [S M E s ]

A s s o c. o f E u r o p e a n C h a m b e r s o f C o m m e r c e

& I n d u s t r y (E U R O -C H A M B E R S)

E U R O C O M M E R C E[E U r e t a i l e r s ]

F r e i g h t F o r w a r d i n g I n te rna t i ona l [l a r g e E U

f re igh t f o rwa rd ing c o m p a n i e s]

F e d e r a t i o n o f E u r o p e a n P r i v a t e P o r t O p e r a t o r s

(F E P O R T ) [ports ]

O r g a n i s a t i o n o f E C Ship -s u p p l i e r s (O C E A N )

[ s h i p p i n g a g e n c y s e r v i c e s]

P o r t O p e r a t i o n s a n d S t e v a d o r i n g

B u s i n e s s S e c t o rIn ter rests

E u r o p e a n B u s i n e s s U m b r e l l a O r g a n i s a t i o n s

T r a n s p o r t S e r v i c e s

M o s c o w I n t e r n a t i o n a l B u s i n e s s A s s o c i a t i o n

I n t e r n a t i o n a l F e d e r a t i o n o f C u s t o m s B r o k e r s

( I F C B A )

A m e r i c a n A s s o c. o f E x p o r t e r s a n d I m p o r t e r s

(A A E I )

J a p a n M a c h i n e r y C e n t r e f o r T r a d e a n d

I n v e s t m e n t

G l o b a l E x p r e s s A s s o c i a t i o n (G E A )

[ p a r c e l s ]

I n t e r n a t i o n a l C h a m b e ro f S h i p p i n g ( I C S) [s h i p o w n e r s a n d o p e r a t o r s ]

I n t e r n a t i o n a l C h a m b e r o f C o m m e r c e ( ICC )

[b u s i n e s s ]

I n t e r n a t i o n a l A i r T r a n s p o r t A s s o c i a t i o n

( I A T A ) [a i r l i n e s]

W o r l d S h i p p i n g C o u n c i l [sh ipp ing l i nes ]

I n t e r n a t i o n a l A s s o c i a t i o n o f P o r t s a n d H a r b o r s

[ po r t s ]

I n te rna t i ona l A l l i ance fo r S e c u r e C o m m e r c e (B A S C ) [s e c u r i t y ]

S I T P R O U K T r a d e Fac i l i t a t i on Agency

P o r t a n d T r a n s p o r t S e r v i c e s

U K B u s i n e s sU m b r e l l a

O r g a n i s a t i o n s

B u s i n e s s S e c t o r I n t e r r e s t s

N a t i o n a l l y S p o n s o r e d I n t e r n a t i o n a l T r a d e


P o r t a n d T r a n s p o r t S e r v i c e s

B u s i n e s s U m b r e l l a


W C O P r i v a t e S e c t o r C o u n c i l G r o u p

D G T A X U DT r a d e C o n t a c t G r o u p

H M R C J C C C M e m b e r s

- Ba r l owo r l d- B o i n g C o m p a n y- B P- C a r r e f o u r- C O S C O- F e d E x- G e n e r a l M o t o r s- H u t c h i n s o n P o r t s

- I B M- L i m i t e d B r a n d s- M a e r s k S e a l a n d- M i c r o s o f t- N i s s a n- P h i l i p s- P r o c t o r & G a m b l e- S i e m e n s- T h a l e s

N a m e d F i r m s


Operational Frustrations in Cross-

border Operations

Customs and Trade Procedures

Governing Regulatory Institutions

Gives rise to the demand for improvements in governing trade procedures

Negotiated outcome sets scope for improvements in governing trade procedures

Implementation of improved trade procedures

Trade Procedures Reform Cycle


n This cycle is slown Appears out of step with the fickle nature

of day to day supply chain operations


Institutional Challenges

n Government Security ObjectivesÜ make efficient use of finite enforcement

resourcesÜ enhance controls at the borderÜ extend controls up and down the supply chainÜ ensure that trade continues

n Business Supply Chain ObjectivesÜ reducing costsÜ increasing value


Challenges (cont.)

n Environmental complexity and institutional overlap

n Government controls and their institutions appear out of step with the SCM practices

n Meaningful incentives by regulators to offset additional burden appear to be thin

n Challenge of realigning a complex arrangement of regulatory institutions to fit the needs of their stakeholders

n Includes the full cross-section of traders and their intermediaries


Challenges (cont.)

n Commercial arrangements in international trade operations can be complex, too

n Power amongst stakeholders in the cross-border environment is not equally distributed

n Business interests are not always alignedn Quite often they are conflicting or

opposing – especially where it gives rise to market positioning strategies


Challenges (cont.)

n Some types of business interests may be under-represented or not represented at all

n As regulatory institutions are overhauled, changed or amended (like through supply chain security regimes) the economics and actors change, too

n Trade facilitation principles can help align government and business interests


Points for Consideration

n Unexplored research areas includeÜ the operational interface between business and

governmentÜ the institutional and regulatory overlap in the control of

goodsÜ the development of a regulatory framework that is

aligned to modern day supply chain management practices

Ü the negotiation process between public and private sector actors in defining trade procedures

Ü the interests of actors and the implementation of trade facilitation concepts

Ü the human and organisational capabilities necessary to enable closer cooperation between business and government actors in supply chain security.


Discussion?

Documents

BR0011328 AGrainger - WCO PICARD 2007 (March) EN...Üthe interests of actors and the implementation of trade facilitation concepts Üthe human and organisational capabilities necessary