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NEWS


A new group representing traders and public stakeholders is calling for a fresh approach to customs and trade compliance requirements, which it says is holding back international commerce and putting huge strains on the national authorities trying to control them.


The SAGE group continues the work of the former ‘Strategic Advisory Group on Europe’ led by trade facilitation ‘Quango’ SITPRO until it was closed in September 2010. Its proposals are primarily EU-focussed, but the group’s aim is for worldwide applicability, wherever possible. The SAGE group’s focus is on developing a long-term strategy for the next five to 25 years, and on reducing burdens on international trade. Its


audiences are government


agencies and authorities - especially customs - around the world and its intention is to open long term discussions leading to trade-led facilitations that benefit both government and the private sector. Its


membership list includes major manufacturers such as Airbus,


BAE Systems, Cummins, Delphi Automotive, General Electric, Mitsubishi, Nissan, Pfizer, Philips Electronics, Siemens, Sony and Tyco, as well as The Body Shop. Government agencies include HM Revenue & Customs (HMRC) and the Department for Business, Innovation & Skills (BIS), along with DHL and The Shipper’s Voice.


The chairman of the SAGE group, Mark Corby says that current compliance systems for international trade are costly, inefficient, bureaucratic, “and need to be fundamentally changed” in favour of a system whereby ‘trusted traders’ would be allowed to control their own compliance. It could ultimately mean the end of import and export declarations in their present form. The group argues that self regulation by those that can demonstrate


rigorous monitoring,


policing and management systems, together with control data that is accessible further upstream in the supply chain, before the goods are loaded for export, would be a better way of ensuring compliance. Also,


a growing number of managers in trading


companies are becoming


frustrated by the increasing costs and complexity of compliance. “The nature of our businesses and the world trading environment requires a totally new approach,” argues Corby He adds: “The days of defining freight as either an import or an export are numbered. An import should merely be seen as the end result of a prior export. We should instead be thinking more in terms of the start and end of a supply chain, and recognising that all the data about the freight and the parties involved in the supply chain is available somewhere in the system before anything gets shipped. If we can work out how to capture it, present it in the right format and give timely and authorised access to the different information and data on the freight, we might one day be able to completely discard all import and export declarations altogether.” SAGE also wants other related issues to be addressed, including VAT simplification, a concerted push to


achieve centralised clearance,


incorporating trade compliance terms and conditions into contracts and


simplifying the harmonised


classification system of goods. Corby explains: “The financial


gains from such an approach would be massive for many companies and governments too that are already struggling to resource the control of international trade and the increased demands placed on them in the fight against organised crime and terrorism.”


SAGE argues that a start would be for industry leaders to open their systems and processes to intimate scrutiny by the authorities in return for their total trust.


The group has produced a paper, ‘International Trade Facilitation Proposals – Sage Vision Document


2011’ .


In an interview with FBJ, Mark Corby said that the new body was “trade led, not customs led” although HM Revenue & Customs (HMRC) are members of the group. At the same time SAGE was establishing links with directorates in Brussels. “We also need EU and national government buy-in, though perhaps the biggest barriers are at company level. We need to quantify the cost of trade compliance and develop a cost model – for instance, how much time companies spend doing customs entries, and how much does it cost a year. And we would also like to look at business structures and see what it is that is stopping our message getting to the top.”


ISSUE 4 2011 New group aims to slash trade red tape


Sage is currently rolling out a cost model which, Mike Corby says, might well produce “some quite startling results. However, the biggest challenge at the moment is selling the concept to companies at board level,” he added.


A small pilot programme, showing how a company can become more competitive by streamlining its processes, might be the way of grabbing senior board members’ attention, he suggests. There could also be attractions for Customs. “Customs are struggling at the moment, looking for ways to manage with lower resources. This could give them that ability – to do more with less.”


www.sagegroup.eu


US security chief cool on 100% box scanning


THE LEADING SUPPLIERS OF FREIGHT,TRANSPORTATION, CUSTOMS, INTERNET AND E-COMMERCE SYSTEMS TO THE FREIGHT SERVICES INDUSTRY ARE MEMBERS OF


The Association of Freight Software Suppliers


AEB (International) Limited Agency Sector Management (UK) Limited Airports Bureau Systems Limited Albacore Systems Limited Artisan Brandt Plc ATMS Plc Azyra Systems Limited BoxTop Technologies Limited CargoWise DataFreight


e-customs Limited Forward Computers Limited Honeycourt Limited


Members conform to a published code of conduct


and supply software, hardware, communications and consultancy to companies of all sizes involved in freight and international trade


AFSS


ASSOCIATION OF FREIGHT SOFTWARE SUPPLIERS


Impatex Computer Systems Limited Imtech Logistics Software Integer Micro Systems Limited Kewill Plc KSD Software Norway AS Langdon Systems Limited PKA Systems Limited Red Prairie Redberry Software UK Limited SCS Limited Sigma Freight Systems Limited Vixsoft Systems Limited


US Homeland Security chief Janet Napolitano said that 100% screening of US-bound containers at port of departure “was probably not the best decision” while on a visit to Rotterdam on 23 June. Asked about


the Container Security Initiative (CSI) passed by Congress in 2007, she said the Department of Homeland Security preferred a more “layered approach” including better co-operation between countries and better intelligence sharing and analysis along with some container scanning.


“I think what we have learnt over time is that there are many different ways to achieve a security objective. You have to have multiple layers that operate effectively,” she said. Although CSI envisaged that all containers entering the US should be scanned by their ports of exit by 2012, Napolitano said: “We at this point are not going to insist on that.”


She pointed out that Congress’ 2012 deadline could be extended if it proved not to be feasible.


Napolitano was on a week-long tour of Britain and Europe to discuss security ties during which she met UK Home Secretary Theresa May. She also agreed an agenda with EU transport commissioner Siim Kallas for enhanced cooperation between their respective services. It called for mutual recognition of EU and US trade partnership programmes and sharing risk information, as well as recognition wherever possible of each other’s transport security controls.


(See Shipper’s Voice, page 14) DfT halts UPS screening


The UK Department for Transport said on 17 June that it had barred UPS from screening air cargo at some of its facilities until it had satisfied security requirements. DfT would not reveal what the security issues were. The


ministry said the restrictions were not based on any immediate or specific


terrorism threat and stressed it was not stopping the firm moving cargo through airports. “It just means they cannot do their own screening - they can use a third party for instance (to carry it out); that will be up to them,” a spokesman said. “The


safety of the travelling public is paramount and our security regime is kept under constant review,” DfT added.


The move follows the discovery


of a Yemeni bomb on a UPS plane at the carrier’s East Midlands hub last October, along with a similar device on a Fedex plane in Dubai.


New deal to strengthen airfreight security


Details of member companies available on website: www.afss.org.uk or from Ken Gower email: afss@dsl.pipex.com Tel: 01474 703453


The Association is recognised by HM Revenue & Customs and by BIFA and is represented on a number of Customs and EU consultation and working groups.


The International Civil Aviation Organization (ICAO) and the World Customs Organization (WCO) have signed a Memorandum of Understanding to protect air cargo from terrorism or other criminal activity as well as to speed up the movement of goods by air worldwide. It


will focus on aligning the


regulatory framework of both organisations and will include electronic advance data, the sharing of


information at various levels


(government-to-government, Customs-to-Customs and Customs-to- industry), training and education, and risk management.


Given the volume of goods


transported by air and the impracticality of screening all cargo, a risk-based approach is considered necessary.


More stringent ICAO air cargo came into force on 1 July, including a new requirement for Member States to establish a supply chain security process.


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