Nature, Structure and Functioning of theTIR Guarantee System & Risk Management Virginia Tanase Head – TIR Policy, Training & Information Moscow, October

Nature, Structure and Functioning Nature, Structure and Functioning of theTIR Guarantee Systemof theTIR Guarantee System

& Risk Management& Risk Management

Virginia TanaseVirginia TanaseHead – TIR Policy, Training & InformationHead – TIR Policy, Training & Information

Moscow, October 2003Moscow, October 2003

© International Road Transport Union (IRU) 2003 Page 2

HarmonisationHarmonisation TIR TIR ConventionConvention

SimplificationSimplification TIR Carnet = TIR Carnet = Customs Declaration & suretyCustoms Declaration & surety

Costs reduction Costs reduction 5 cents for5 cents for100 USD of guarantee100 USD of guarantee

TIR =TRADE FACILITATIONTIR =TRADE FACILITATION

NATURENATURE


NATURENATURE

TIR is a privilege not a rightTIR is a privilege not a right

Guaranteeing Association acts as Guaranteeing Association acts as surety for persons using thesurety for persons using theTIR procedureTIR procedure(Art. 1(q) - TIR Convention)(Art. 1(q) - TIR Convention)


STRUCTURESTRUCTURE

ASSOCIATIONASSOCIATION

SURETY AGREEMENTSURETY AGREEMENT

Subject to national legislationSubject to national legislation

Main conditions for suretyMain conditions for surety

Maximum amount of suretyMaximum amount of surety

SafeTIR agreement (annex)SafeTIR agreement (annex)

CUSTOMSCUSTOMS


STRUCTURESTRUCTURE

ASSOCIATIONASSOCIATION

DEED OF DEED OF ENGAGEMENTENGAGEMENT

Rules & responsibilities for Rules & responsibilities for administration of TIR systemadministration of TIR system

Engagement from the IRU to Engagement from the IRU to guarantee the surety provided guarantee the surety provided by the association to Customsby the association to Customs

IRUIRU


STRUCTURESTRUCTURE

ASSOCIATIONASSOCIATIONIRUIRU


STRUCTURESTRUCTURE

ZHZH

3 Mil TIR Carnets issued per year3 Mil TIR Carnets issued per year

500 Mil USD of guarantees per day500 Mil USD of guarantees per day

Guarantee Chain is backed by a financial institution (ZH) Guarantee Chain is backed by a financial institution (ZH)

ZH guarantees the surety provided by the Guarantee ZH guarantees the surety provided by the Guarantee Chain to CustomsChain to Customs

IRUIRU

GLOBAL GUARANTEE GLOBAL GUARANTEE CONTRACTCONTRACT


STRUCTURESTRUCTURE

ASSOCIATIONASSOCIATIONIRUIRUZHZH


FUNCTIONINGFUNCTIONING

TIR is a financial security for CustomsTIR is a financial security for Customs

Persons directly liablePersons directly liable=> Financially liable to Customs without limits=> Financially liable to Customs without limits


FUNCTIONINGFUNCTIONING FUNCTIONINGFUNCTIONING

goodsgoods

vehiclevehicle

TIR CarnetTIR Carnet

Holder of TIR Carnet Holder of TIR Carnet = = Declarant of transit Declarant of transit operation operation =>=> responsible for the presentation of: responsible for the presentation of: (Art. 1(o) – TIR Convention)(Art. 1(o) – TIR Convention)

at the Customs office of destinationat the Customs office of destination

=> Legitimate contact person for Customs=> Legitimate contact person for Customs



Provide relevant documentsProvide relevant documents

Cooperate for the proper identification of the Cooperate for the proper identification of the persons directly liablepersons directly liable

OROR

Pay the Customs debt when at faultPay the Customs debt when at fault(Art. 8.7 – TIR Convention)(Art. 8.7 – TIR Convention)

Holder of TIR Carnet must assist the Holder of TIR Carnet must assist the Customs to solve any problem related to a Customs to solve any problem related to a TIR operation. He must:TIR operation. He must:


« ...the competent Authorities shall so far as « ...the competent Authorities shall so far as possible require payment from the person possible require payment from the person or persons directly liable before making a or persons directly liable before making a claim against the Guaranteeing claim against the Guaranteeing Association… »Association… »


Article 8.7 – TIR ConventionArticle 8.7 – TIR Convention

BASIC PRINCIPLE:



ImporterImporter

Company responsible for transport and Company responsible for transport and Customs clearance (forwarding agent)Customs clearance (forwarding agent)

Company owning or disposing of the goodsCompany owning or disposing of the goods

Holder of TIR CarnetHolder of TIR Carnet

Guaranteeing Association acting as suretyGuaranteeing Association acting as surety

Liability Chain:



The Chain of Guarantee can only function efficiently when the TIR Convention is

properly implemented:

Persons directly liable quickly identified

Proper procedure engaged to obtain payment from them

Sanctions are applied in due course against non-compliant operators


Make sure that all irregularities and claims are handled Make sure that all irregularities and claims are handled according to the same principles (TIR Convention) according to the same principles (TIR Convention) throughout all the Contracting Parties.throughout all the Contracting Parties.

Role of the IRU:Role of the IRU:


Role of the Association:Role of the Association:

Implement the decisions of the Chain of Guarantee and Implement the decisions of the Chain of Guarantee and follow the procedures to handle claims.follow the procedures to handle claims.


Appropriate (strict) Management rulesAppropriate (strict) Management rules

Preventive measures by all actors (IRU, Associations, Preventive measures by all actors (IRU, Associations, Holders of TIR Carnets, Customs)Holders of TIR Carnets, Customs)

Risk Management: SafeTIRRisk Management: SafeTIR

For the correct functioning of the TIR System and For the correct functioning of the TIR System and the Guarantee Chain it is essential to have a the Guarantee Chain it is essential to have a systematic application of:systematic application of:



RISK MANAGEMENT:RISK MANAGEMENT: SafeTIRSafeTIRRISK MANAGEMENT:RISK MANAGEMENT: SafeTIRSafeTIR

Why SafeTIR?Why SafeTIR?

To confirm at any time and in real - time the validity of To confirm at any time and in real - time the validity of the Customs stamp on the TIR counterfoil (souche)the Customs stamp on the TIR counterfoil (souche)


Holder returns Holder returns TIR carnet to TIR carnet to AssociationAssociation

TIR Carnet TIR Carnet Physical Physical

check with check with

Electronic Electronic SafeTIR SafeTIR

cross-check cross-check


SafeTIR = Risk ManagementSafeTIR = Risk ManagementSafeTIR = Risk ManagementSafeTIR = Risk Management

If OK issue new If OK issue new carnetcarnet

If If not OKnot OK, , request proofs request proofs + reconciliation+ reconciliation

If If still not OKstill not OK, ,

suspend suspend issuanceissuance



Real TimeReal TimeCapture & TransmissionCapture & Transmission

of SafeTIR dataof SafeTIR data

IRU IRU DatabaseDatabase


ONLYONLY% of SafeTIR % of SafeTIR

data transmitted data transmitted within 24 hourswithin 24 hours

ONLYONLY

% of SafeTIR % of SafeTIR data transmitted data transmitted within 2 - 4 dayswithin 2 - 4 days

% of SafeTIR % of SafeTIR data transmitted data transmitted within 15 dayswithin 15 days

0.4%0.4% 7% 7% 75%75%

RISK MANAGEMENT: SafeTIRRISK MANAGEMENT: SafeTIR

Real time capture and transmission of SafeTIR data Real time capture and transmission of SafeTIR data is needed for effective Risk Managementis needed for effective Risk Management


RISK MANAGEMENT: SafeTIRRISK MANAGEMENT: SafeTIRRISK MANAGEMENT: SafeTIRRISK MANAGEMENT: SafeTIR

Efficiency of SafeTIR also depends on the Efficiency of SafeTIR also depends on the reconciliation procedure:reconciliation procedure:

BUTBUT

50 %50 % of the reconciliation requests take of the reconciliation requests takeup to up to 50 days50 days for response for response


Secure Customs dataSecure Customs data

Internet basedInternet based

Low costLow cost

Download possibilitiesDownload possibilities

Tool Accessibility: CUTE-Tool Accessibility: CUTE-WiseWise



Efficient if Customs:Efficient if Customs:

Capture and transmit Capture and transmit ALLALL SafeTIR data SafeTIR data

In In Real TimeReal Time

For each Termination of TIR Operation at For each Termination of TIR Operation at each Customs office of destinationeach Customs office of destination

Implement efficient Implement efficient Reconciliation procedureReconciliation procedure



TIR Guarantee System is based on:TIR Guarantee System is based on:

Proper implementation of TIR Convention Proper implementation of TIR Convention

Early detection of potential irregularities Early detection of potential irregularities through Risk Management through Risk Management

Collection of duties and taxes from real Collection of duties and taxes from real debtors debtors

Sanctions of FraudstersSanctions of Fraudsters

CONCLUSIONCONCLUSIONCONCLUSIONCONCLUSION

Documents

Nature, Structure and Functioning of theTIR Guarantee System & Risk Management Virginia Tanase Head – TIR Policy, Training & Information Moscow, October