Facilitating Trade in a Secure Environment

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Trade Facilitation and Security Modeling

• Facilitating Trade in a Secure Environment
• Geneva, Nov 13-14

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Background
Rudolf J Bauer Security includes general customs
management issues to protect govt. Revenue
collection, detect smuggling ...

• UNECEs UN/CEFACT working groups International
  Trade Procedures and Business Process Analysis -
  decided to use the International Supply Chain
  Reference Model to
• Illustrate the impact of currently discussed
  security measures on the international supply
  chain
• Analyze potential overlaps of different
  initiatives, that might have a negative impact on
  the fluidity of trade
• Identify gaps between different initiatives,
  jeopardizing the overall security of the
  international supply chain

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(No Transcript)
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Sub Processes of the Ship Use Case Original
ISC model
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Status of Modeling Activities

• Included the activities described in WCOs ACI
  Guidelines in the proper sub-processes and added
  more details on actors
• Included the activities of US Customs 24-Hour
  Rule
• Modeled the requirements of IMOs ISPS framework
  at a high level (use cases)
• Added further detail to the Transport
  sub-process using work from UN/CEFACTS Transport
  working group (MIST)
• Positioned the European Commission communication
  on a simple and paperless environment for
  Customs and Trade vs. the expanded ISC model.

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Sub Processes of the Ship Use Case Security
Trade Facilitation Model
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Transport Service Buyer Carrier
Customs (COO)
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Business Collaboration Carrier Customs
Carrier Customs (COO)
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24 Hour Rule Observations

• Impacts identified exclusively in export
  prepare for import sub-processes
• CF1302 (cargo declaration)
• CF3171 (unload permit)
• Effects Carrier and Customs Office
  Outward(in case of maritime transport)
• Carrier has to issue cargo declaration (24hours
  in advance)
• Carrier has to query Customs Office Inland (COIN)
  for unload permit
• Customs Office Inland (COIN) (COIN) has to issue
  unload permit

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ACI Guideline Observations

• Several points along the ship sub-process where
  security compliance can be checked
• Either the information in advance and/or the
  goods on arrival
• Provides for simplification in the case of
  authorized traders
• Single declaration by the Exporter is sufficient
  neither Carrier, nor Buyer need to submit import
  documents
• Customs authorities (COI) can eliminate double
  checking documents
• Adopts a Single Window approach
• It allows traders to lodge documents to one
  single agency
• Information is subsequently forwarded or shared
  with other customs organizations or goverment
  agencies
• Predicated on the adoption of a Unique
  Consignment Reference Number (UCR)

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Potential Security Compliance Checks
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International Ship And Port Facility Security
Code (ISPS)
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ISPS Observations

• A security framework for Vessels and Ports
• Introducing new actors (Security officers, govt.
  Authorities)
• Introducing notions of security plans,
  certificates
• Most provisions are outside the scope of the ISC
• Development and certification of port facility
  and ship security plans
• Provisions to safeguard and monitor access to
  cargo aboard ships and in ports.
• By definition it effects maritime transport only
• Set security level, request declaration of
  security, manage different security levels

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Conclusions supported by the current model

• Modelling is a useful tool for identifying how
  existing security initiatives line up and
  integrate. However, work completed to date covers
  only a selection of the current security
  initiatives. Completion of this work should
  reveal areas where the overall security gaps and
  overlaps exist in the international supply chain.
• Initiatives modelled so far indicate that in the
  transport sub-process, only the ship modality is
  being considered (by virtue of the ISPS)
• The model also shows that the European
  Commissions proposal is aligned with the WCOs
  ACI Guidelines and includes provisions similar to
  US Customs 24 Hour Rule
• Participation of other organisations in the
  modelling work would serve to both enhance the
  model and also allow participants to analyse how
  their proposals integrate with other initiatives
  in the international supply chain.

• Analyzed initiatives apply only to portions of
  the international supply chain
• In the transport sub-process, the focus is on
  maritime transport security (ISPS provisions)
• In all other sub-processes customs seems well
  positioned to exercise security compliance
  checking
• European Commissions proposal is aligned with the
  WCOs ACI Guidelines and includes provisions
  similar to US Customs 24 Hour Rule
• Completion of this work should reveal areas where
  the overall security gaps and overlaps exist in
  the international supply chain.

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ISC Security Modeling Proposed Future Work

• Review and complete Sub-Processes to
• Include document information (class diagrams)
• Incorporate work on UNeDocs, the WCO data model
• show which information is required or referred to
  in which activity
• assess the cost time impact of critical
  activities
• Provide further model detail to ISPS
• Activity diagrams of Request declaration of
  security and Manage different security levels
• Include measures of the Single Window Initiative

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ISC Security Modeling Proposed Future Work
(cont.)

• Analyze the impact of the future Security
  Management Standard using the present model
• Model Trade Facilitation Recommendations and
  Measures
• Encourage participation of other organizations in
  the modelling effort
• To enhance the model and consequently increase
  its value
• allow participants to analyse how their proposals
  integrate with other initiatives in the
  international supply chain

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Reflections on the use of modeling in Trade
Facilitation and Supply Chain Security

• First Experiences focussed on security dominated
  initiatives exclusively
• ISPS, ACI Guidelines, 24 Hour Rule and the EC
  Recommendations
• Modelling is a useful tool for identifying how
  existing security initiatives line up and
  integrate.
• Although the current model covers only a
  selection of the current security initiatives.
• Value of the model to assess the interactions and
  combination of different security and trade
  facilitation measures

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Reflections on the use of modeling in Trade
Facilitation and Supply Chain Security (Cont.)

• The assessment of the impact of either trade
  facilitation or security related measures
  requires sufficient detail
• Business collaboration level
• Detail and volume of business information
• Continued maintenance of the model is tantamount
  to be of value
• Business Process modeling is a valuable approach,
  however not sufficient to assess all potential
  impacts
• No forecast on changes in trade volume resulting
  from i.e. new regulatory requirements or their
  abolition

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References

• The BPAWG Reference Model of the International
  Supply Chain. UN/CEFACT/BPA/BP044, March 2003
• Customs Guidelines on Advance Cargo Information
  (ACI Guidelines). World Customs Organization.
  V0.6, May 2003
• Report of the Multi Industry Scenarios for
  Transport (MIST) Version 2001, DRAFT 22 June 2001
• Proposal for Standards Development in support of
  Trade Facilitation and Security-A collaborative
  approach, UNECE/TRADE/2003/22, April 2003
• COMMUNICATION FROM THE COMMISSION TO THE COUNCIL,
  THE EUROPEAN PARLIAMENT AND THE EUROPEAN ECONOMIC
  AND SOCIAL COMMITTEE, a simple and paperless
  environment for Customs and Trade, Brussels,
  24.07.2003 COM(2003) 452 final