UNECE 3rd Executive Forum on Trade Facilitation Paperless Trade in International Supply Chains Geneva, June 20th 2005 - PowerPoint PPT Presentation

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UNECE 3rd Executive Forum on Trade Facilitation Paperless Trade in International Supply Chains Geneva, June 20th 2005

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UNECE 3rd Executive Forum on Trade Facilitation Paperless Trade in International Supply Chains Geneva, June 20th 2005 Private Sector Experiences on new Information ... – PowerPoint PPT presentation

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Title: UNECE 3rd Executive Forum on Trade Facilitation Paperless Trade in International Supply Chains Geneva, June 20th 2005


1
UNECE3rd Executive Forum on Trade Facilitation
Paperless Trade in International Supply Chains
Geneva, June 20th 2005 Private Sector
Experiences on new Information Requirements for
Secure and Efficient Supply Chains
Dermot J. Leeper
speaking for
2
Introduction to FFI
  • Freight Forward Europe (FFE) created in 1994 -
    Freight Forward International (FFI) since
    1/1/2004
  • Interest group of nine of the leading global
    freight forwarders logistics providers
  • Employ more than 210,000 people
  • Transport more than 5 million tons air and 5
    million teu ocean
  • Turnover of more than 37.7 billion Euro
  • 30 of the Forwarding market worldwide

3
contents
  • Our experiences with air ocean transportation
  • What we have learnt
  • The benefits
  • The risks
  • Recommendations

4
customs clearance
  • NOTES
  • Within GeoLogistics, data transfer is standard.
  • Customs in every country is different, but
    sorted out at destination.
  • Some Customs are paperless which speeds the
    transaction, but requires EDI Commercial Invoices.

5
Security pre-alerts
  • NOTES
  • Information now has to flow from the origin to
    destination customs.
  • Different customs requirements makes this model
    impossible.
  • E.g. AMS, ACI and EU details differ.

6
Security pre-alerts
  • NOTES
  • So we create quality departments at destination.
    These have to operate 24/7.
  • So while AMS ACI are paperless, they are very
    labour intensive.
  • Note being compulsory, they were implemented in
    very short time.

7
EDI with Carriers
  • NOTES
  • EDI supplements paper, it does not replace it.
  • So audit trails are not rigorous and poor data
    integrity is tolerated.
  • The benefits are uneven, and not strong enough to
    drive rapid deployment.

8
EDI with Shippers
  • NOTES
  • EDI between shippers and their forwarders is
    happening. But the development is very slow.
  • Until this becomes commonplace, we do not have
    true paperless trade in the international supply
    chain.

9
Security considerations
  • Fraud through forged and incorrect documentation
    harms consignees, government revenues,
    forwarders, and the public
  • Estimated Euro 3 - 8 Billion Fraud in EU Transit
    Movements in mid 1990s due to forged documents
    in old paper Old Transit System. (Evidence is
    that EU New Computerised Transit System has
    largely eradicated this particular Fraud.)
  • Unquantified global fraud through forged paper
    Certificates of Origin should also be eradicated
    through paperless trading.
  • But with Electronic Trade there is a Security
    and Fraud risk from
  • Hackers accessing electronic systems or portals
    within the supply chain.
  • Unauthorised diversion of sensitive data.
  • Physical Security is improved by good track
    trace (knowing where the goods are and where they
    are meant to be). This benefits
  • The owners of the goods.
  • Governmental security.

Source - EU Parliament Committee of Enquiry
Report
10
Benefits of Paperless Trade in International
Supply Chains
  • Speedier Data Availability and Transmission
  • Improved Accuracy through less re-keying of data
  • Improved D2D Transit Time
  • Enhanced Customer Service e.g Track and Trace
  • Reduced Fraud / Security Risk
  • Reduced Costs
  • Labour
  • Stationery
  • Postage Courier Fees
  • Filing Space
  • Insurance
  • Less Adverse Environmental Impact

but only if it is done right !
11
examples of not done right
  • AMS ACI are different creating additional work
    and cost.
  • EDI with airlines is supplementary to paper, so
    more work cost.
  • Customs clearance in many countries is only
    finalised when paper copies are delivered.
  • Carriers refuse to sign Non-disclosure Agreements
    and do not act to protect data, thus increasing
    security fraud risks.
  • Forwarders are too slow to develop paperless
    processes with shippers. Re-keying leads to more
    work and data integrity problems downstream.
  • Result the benefits of paperless trade are only
    partially gained
  • The supply chain is less efficient and less
    secure than it should be.
  • Costs are shuffled along the chain, not
    eliminated.

12
What have we learned?
  • Governments have the power to make things happen
    much more quickly.
  • Governments can make the supply chain less
    efficient by failing to co-ordinate on a
    multinational basis or between national agencies.
  • Making one transaction paperless does not improve
    the whole supply chain it merely moves the
    bottleneck (and costs) along the chain.
  • Commercially driven developments have not shown
    sufficient benefits for all parties to allow
    speedy development.
  • Data integrity and audit trails are essential at
    every stage.
  • There are new risks for forwarders
  • Potential liability for Customs debt, and
    possible criminal proceedings, for submitting
    Electronic Data as Agents on behalf of the real
    Principles.
  • Hackers into any system within the supply chain.
  • Disclosure of commercially sensitive data.

13
How can Governments facilitate Paperless Trade?
  • Less competition between Governmental Agencies
    on security issues for political purposes.
    Instead, greater co-ordination between Customs
    and OGAs to align data requirements and
    standards to WCO recommendations
  • Internationally
  • Between National Governmental Agencies
  • More partnership with legitimate trade experts
    to achieve synergistic benefits for both Trade
    and Governmental Agencies
  • E.g. the EU Commissions Trade Contact Group
  • Greater involvement of relevant Governmental
    Agencies in Electronic Trade initiatives proposed
    by Trade bodies
  • E.g. the IATA e-Freight Initiative
  • Possible financial support for portals that
    standardise and facilitate information flow.
  • Recognition of C-TPAT (Customs Trade Partnership
    Against Terrorism) status in the US towards
    Authorised Economic Operator status in the EU,
    and vice versa.
  • Eventual pooling of security data between aligned
    Customs Administrations and OGAs for optimised
    Security Risk analysis.

14
Freight Forwarding International Vision
  • FFI is uniquely placed, ready, and eager to work
    in global partnership with all parties to provide
    an International Supply Chain that has the
    optimum efficiency and security for all.
  • This will only happen with closer co-operation
    between global Customs Administrations, OGAs and
    legitimate trade experts.
  • FFI is actively participating in the EU Trade
    Contact Group and is in regular contact with US
    CBP and WCO, advocating the items on the previous
    slide.

15
Thank you
Dermot J. Leeper
speaking for
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